Greenspun, Hughes changed Las Vegas

By Ed Koch, Mary Manning

Saturday, July 1, 2000 | 2:38 a.m.

Had it not been for the close relationship between Sun Publisher Hank Greenspun and billionaire Howard Hughes, Las Vegas hotel-casinos and the Las Vegas Sun might not be thriving as they are today.

With Greenspun leading the charge in his Where I Stand column, the Sun was an arch foe of the mob that had infiltrated Strip hotels. It was partly in response to a Sun editorial inviting him that Hughes arrived in Las Vegas from Boston, where reporters had been relentless in their pursuit of this intensely private man.

Hughes' arrival here spelled the beginning of the end for the mob. Although the mob would still have a significant presence here until the mid-1980s, the trend of respectable corporate executives running casinos began with Hughes.

On Dec. 2, 1966, Greenspun wrote a front-page column welcoming the billionaire to town and foreseeing the vast potential of Hughes to change history here forever.

"Continuous snooping and harassment forced him out of our community years ago and he built giant industries elsewhere," Greenspun wrote. "The same thing could happen again (if the community doesn't respect his wishes for privacy)."

"Nevada has an opportunity to gain as a permanent resident this man who stands foremost among all giants of industry, finance and humanity. He alone is bigger than any other single Nevada industry or combination of all."

Greenspun, of course, was right -- Hughes would go on to spend hundreds of millions in Las Vegas and change the corporate culture so radically that today's megaresorts are direct beneficiaries.

With Greenspun's welcoming column began a long-standing personal relationship that was not always rosy and ultimately soured but that once worked to benefit the Sun in a major way. In 1967 Hughes loaned the Sun $4 million at 3 percent interest so that the paper could finally recover from a fire in 1963 that had burned its original building to the ground.

Hughes arrived in Las Vegas for his memorable four-year stay at 4 a.m. Thanksgiving Day 1966. He sneaked in by special train that originated in Chicago. He was so determined to arrive under cover of darkness that when the train's schedule was changed, meaning he would not get to Las Vegas until daybreak, he paid $17,000 for a special engine to bring him into town earlier on a Union Pacific spur line from Utah.

Hughes was transferred to a van waiting on Losee Road next to the railroad tracks in North Las Vegas and spirited to the Desert Inn before dawn. That was the last time Hughes would be exposed to the public until Thanksgiving 1970, when he suddenly departed for the Bahamas.

Robert Maheu, chief executive of Hughes' Nevada operations, had secured the entire ninth floor of the Desert Inn. Hughes communicated with the outside world by way of handwritten memos to Maheu. The memos would be delivered to Maheu through trusted aides, who attended Hughes 24 hours a day. Maheu himself never saw his boss.

After Hughes left Las Vegas, many of the memos, reproduced exactly as Hughes had written them, found their way onto Page 1 of the Sun, accompanying definitive stories about the reclusive billionaire and his mysterious ways.

Maheu had replaced Noah Dietrich, who spent 32 years at the helm of the Hughes empire. Hughes put Maheu in charge of counterintelligence, something Maheu was well equipped to handle. He had served in the FBI's counterespionage section during World War II and also had worked with the CIA.

Acting on Hughes' orders, Maheu sealed the ninth floor of the Desert Inn at all hours of the day and night to ensure absolute privacy for Hughes.

It is well known that Hughes bought $300 million worth of Strip properties, an acquisition spree that helped usher out the era of the mob and usher in the era of corporate ownership of hotel-casinos.

What isn't so generally well known is Hughes' desperate opposition to nuclear testing. The extent of his concern in this area became fully known in the mid-1990s when then-Department of Energy Secretary Hazel O'Leary declared an openness policy that resulted in many of Hughes' previously secret memos becoming public for the first time.

Hughes had been well aware of the government's nuclear weapons experiments at the Nevada Test Site 65 miles northwest of Las Vegas since the 1950s, Maheu told the Sun in a recent interview. "This was long before Hughes even had a thought about coming to Las Vegas," he said.

"He had a fear that the government was running late in releasing radioactive fallout statistics," Maheu said. "And he was right."

This means that Hughes, who had a top-secret clearance during World War II because his plants were contracted to produce aircraft and weapons for the military, knew that radioactivity was lethal, despite government assurances that fallout represented little danger. Hughes knew that deadly nuclear fallout was not limited to a few miles around the Test Site but was in fact threatening the entire Northern Hemisphere.

In 1968 Hughes wrote a letter to the Nobel committee suggesting that Greenspun receive the Peace Prize for a column he had written opposing nuclear experiments at the Test Site. Greenspun was an early opponent of nuclear testing, fearing, as Hughes did, that the government was not being open and that people's lives were endangered.

History shows that Greenspun and Hughes were right, that millions of people were exposed to radioactive fallout and that thousands died.

The billionaire threatened to become the most vocal and well-funded anti-nuclear activist in history if the government didn't move the nuclear experiments out of Nevada, according to memos recently released by the DOE.

As the nuclear warhead experiments grew larger and larger, many of them shaking Las Vegas, the billionaire feared that the explosions would drive tourists away and pollute the air, soils and water with radiation.

"Everybody says he was worried about his own welfare, but he was worried about the welfare of the world," Maheu said.

Twice he ordered Maheu to Washington with briefcases containing $1 million in cash. The money was to secure presidential promises to end nuclear testing in Southern Nevada. Maheu said that on each trip, once to see President Lyndon Johnson and once to see President Richard Nixon, he dutifully carried the briefcases but never unlocked them, never held out what obviously would have been illegal bribes.

This early opposition on the part of Greenspun and Hughes to nuclear experiments set the stage for the Sun's leading involvement with this issue after Yucca Mountain, 90 miles northwest of Las Vegas, was selected by Congress in 1987 to become the nation's sole dump for nuclear waste. The Sun has taken an uncompromising editorial stand opposing Yucca Mountain and the Sun's reporting on the issue has earned numerous awards.

Although Greenspun and Hughes often agreed on issues and engaged in business dealings, relations between the two were often tense, especially during the Watergate scandal that ultimately led to Nixon's resignation.

In 1969 and 1970, years when Hughes was seeking federal approval for airline acquisitions, two $50,000 packages were delivered by a Hughes representative to Charles G. "Bebe" Rebozo, confidante of President Nixon.

An October 1973 Washington Post editorial noted: "Robert A. Maheu, Mr. Hughes' former chief of staff in Nevada, has testified under oath that Mr. Rebozo had been 'chosen by Mr. Nixon' to receive the money that had been 'earmarked' for the president.

"Mr. Rebozo has told investigators for the Senate Watergate Committee that the money was intended as a campaign contribution. He also says that he kept it in safety deposit boxes in Florida for a number of years."

Sun Editor Brian Greenspun recalled that his late father attended a Richard Nixon press conference in San Clemente, Calif., and asked if Hughes' $100,000 was used to furnish Nixon's home in San Clemente.

"The next day, Nixon's attorney, Herb Kalmbach, was in my father's office to tell him the money was not used to furnish Nixon's home in San Clemente, but went instead to Rebozo's house in Key Biscayne, Fla.," Brian Greenspun said.

"Rebozo called the press out to his home to show them the $100,000 was still there. He opened his safe and pulled out wrapped bunches of bills."

Brian Greenspun said, however, that Rebozo wound up with egg on his face when Hank noticed that the name on the bill wrappers was that of a Las Vegas bank that was known by another name when Rebozo got the money three years earlier.

"At the time, people were so sick of Watergate nobody cared," Brian said.

Another incident illustrates that the Watergate burglars didn't just hang around Washington. They attempted to break into Greenspun's safe at the Sun offices. They succeeded in damaging the safe's door but never broke it open in their quest, presumably, to find incriminating documents relating to Hughes' bankrolling of politicians.

This incident was recorded on the infamous Watergate tapes, transcripts of which have Nixon asking: "What in the name of (expletive deleted) though has Hank Greenspun got with anything to do with (Attorney General John) Mitchell or anybody else?"

No one in Nixon's office at the time, including top Nixon aides John Erlichman and Chuck Colson, could give the president an answer. The break-in at Hank's Sun office remains one of the enduring mysteries of Watergate.

When Hughes suddenly left the state in late 1970, a fight for control of his company ensued. Hughes officials from outside Nevada took over, fired Maheu, and clouded the title to 2,000 acres of open land owned by Greenspun in Henderson, which he had used to secure his $4 million loan.

Greenspun supported Maheu in his unsuccessful court fight to retain his position. And he ultimately prevailed in court regarding the title to his land. That land is now part of the master-planned community of Green Valley, developed by American Nevada Corp., a Greenspun family business.

Despite having supported Hughes as the billionaire who made positive contributions to Nevada, Greenspun later soured on the man as the truth behind many of his financial dealings came to light, particularly in his acquisitions of TWA and Air West airlines.

Greenspun was outraged to learn that "thousands of little stockholders" had been defrauded during the transactions.

In a July 29, 1974, column, Greenspun wrote: "Why is this billionaire, who has used his immense wealth to attempt to influence and corrupt public officials at every level of government including the White House, not held to accountability for his actions as is required for all the nation's citizens including the president himself?"

In the end, despite his previous close association with Hughes, Greenspun came full circle, choosing to stand with the little guy.