Howard Hughes, the ClA, the Mob and Las Vegas

Hughes’ Two Most Important Business Decisions:  Noah Dietrich and the ClA

Howard Hughes

We all know the story of brilliant businessman Howard Hughes, who made billions in the oil, movie, aviation, defense and casino industries.  But the truth is, Hughes was a terrible businessman.

Hughes’ best business moves were two critical personnel decisions:  the hiring of Noah Dietrich in 1925, and his decision to partner up with the ClA.  That decision happened no later than 1948, right after the ClA’s creation, but Hughes was likely involved with the OSS and/or various ClA predecessor intelligence units in the military and State Department even earlier, during the war.  The decision to partner up with the ClA made Hughes even more money than Noah Dietrich did.  But that decision to partner with the agency was also his worst.

Hughes was born December 24, 1905.  He inherited 75% of Hughes Tool Co., his father’s company, when his father died on January 14, 1924.  His father had invented a revolutionary oil drilling bit that pulverized rock instead of scraping it.  The bit was nicknamed “the rock eater.”  It got through rock at 10x the speed of any other drill bit.

Within a year of his father’s death, Hughes bought out the other 25% of the company from his relatives.  He also hired Dietrich, a CPA with a diverse business background in banking, real estate, and oil.  Hughes’ father, like Howard, was never much of a businessman despite his brilliant invention.  Dietrich took the company, worth $660,000 in 1925 (roughly $10 million in 2020 dollars), applied sound business and tax-saving strategies to it, and turned it into a $75 million company by 1930 (roughly $1 billion in 2020 dollars), enough to fund Hughes’ stabs at becoming a professional golfer, a movie producer, an aviator, and everything else.

Later, Dietrich won war production contracts for Hughes Tool, invested in real estate for the company, and automated its “hobby shop” style production line.  After the war, Hughes Tool made $285 million in profits under Dietrich’s management before Dietrich left the company after 32 years in 1957.  That’s roughly $2.4 billion in 2020 dollars.

Dietrich ran TWA for Hughes as well, for which Hughes paid about $1.4 billion (in 2020 dollars) for a 75% stake in 1939.  Hughes also paid a $1.1 billion penalty (in 2020 dollars) for mismanagement of the airline in the 1950s.  But Hughes sold his stock for $3.8 billion in 2020 dollars when he was forced out in 1965.  That’s another $1.3 billion that Dietrich made Hughes.

The value of Hughes’ estate when he died in April 1976 was $1.5 to $2 billion (roughly $7.5 to $10 billion in 2020 dollars), plus another $5-$6 billion in Hughes Aircraft ($25 billion in 2020 dollars), which had been spun off from Hughes Tool into a tax shelter called the Howard Hughes Medical Institute.  The “charity” donated virtually nothing to medical research during Hughes’ lifetime.

Dietrich had made Hughes about $5 billion of that (in 2020 dollars).  The rest of Hughes’ money appears to have come, in one way or another, from the ClA, and the ClA made sure they got it back.  Continue reading Howard Hughes, the ClA, the Mob and Las Vegas

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How to End a Novel

The March 1971 issue of National Lampoon contained an article, “How to Write Good,” by my favorite writer at the mag back then, Michael O’Donoghue. In that article, in the section titled “Lesson 2 – The Ending,” O’Donoghue writes:

All too often, the budding author finds that his tale has run its course and yet he sees no way to satisfactorily end it, or, in literary parlance, “wrap it up.” Observe how easily I resolve this problem:

Suddenly, everyone was run over by a truck. -the end- Continue reading How to End a Novel

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Hack Writing 201: Dynamite Openings

Reading fiction manuscripts from a slush pile has gotten me thinking about opening lines. A dynamite opening is what separates the royalty checks from the rejection slips. Hemingway knew this. Fitzgerald knew this. All the greats knew this. Now, I’m revealing this insider’s secret to you. Simply stated, you want a few lines, right off the top, that will grab the reader and not let go. For example, here are the opening lines of an (unpublished) novel a friend worked on for years: Continue reading Hack Writing 201: Dynamite Openings

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How to Overcome Writer’s Block: Advice from a Write-aholic

I’m a write-aholic. I get writer’s block about as often as an alcoholic has a day where he just can’t force himself to drink. It doesn’t happen too often. So, maybe I’m not the best one to give advice on how to overcome writer’s block. Then again, maybe I am…

If I take my car in for an oil change and I have to sit around for half an hour in a Honda dealership waiting room, where the accommodations include weak coffee and back issues of People magazine, I write. I always carry a pen and notepad. I’m always writing something in my head, even when driving, walking, eating. I get it down on paper as soon as I’m able. I pull over to the side of the road if necessary. If I take myself out to breakfast, someplace where the coffee’s good and the refills keep coming, I write. As I write these words you’re reading now, I’m sitting under a tree in Red Rock Canyon while my dogs are frolicking in the creek. I get quite a bit of writing done on my daily dog walks.
Continue reading How to Overcome Writer’s Block: Advice from a Write-aholic

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The Las Vegas Art Scene – Sin City Goes Boho

Illustration by Joseph Watson

One interesting development in Las Vegas in these lean years is that the downtown area is turning into some kind of artists’ colony. There are galleries and poetry readings and street musicians and guerrilla theater and contortionists and coffee house hangouts and freaks carrying signs. It looks like Greenwich Village in the 1930s (like I was there), or SF’s North Beach in the 50′s (or there), or the Haight-Ashbury in the 60s (Yay!).

Continue reading The Las Vegas Art Scene – Sin City Goes Boho

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Dick-lit Tracy – Here Goes Nuthin’

I was sitting in my office late one night, staring at the pile of bills stacked up on my desk, wondering if I’d ever see another payday.

In walked a tall blonde in a short skirt.

“Mr. Snyder?” she said. “I need help.” Her lipstick was red. Her eyes were blue. Her voice was like maple syrup dripping down the side of a stack of flapjacks.

“It’s my husband,” she said. “I think he’s a vampire.”

A vampire? I can do vampires. I’m a write-aholic. I can write anything—for money. Continue reading Dick-lit Tracy – Here Goes Nuthin’

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TOM WAITS GETS LOST IN TRANSLATION

Scarlett Johansson sings
Tom Waits: Singin’ in the Pain…

After posting my review of Bukowski’s Post Office on Monday, I became curious about what average readers were saying about Bukowski these days, so I went to goodreads to check out the reader reviews. One interesting thread started when a reader posted a comment that reading Bukowski always made her think of Tom Waits. The thread went on for some time as many others agreed.

I’ve long been a Tom Waits fan and just reading the reviews made me want to listen to one of his old albums. Looking through my CD rack, I had to laugh when I came upon “Anywhere I Lay My Head,” a CD I’d purchased a couple years ago and had forgotten about. Continue reading TOM WAITS GETS LOST IN TRANSLATION

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