In fact, it was not until June 26 that Danner finally caught up with Rebozo in Miami. The next day Maheu withdrew $50,000 from Hughes’s personal bank account for “nondeductible contributions,” the code word he used to cover political payoffs.
The deal went down on the Fourth of July.
The president had spent that morning reviewing a parade in Key Biscayne, performing his public duty with obvious discomfort, sweating profusely in a heavy suit on a sweltering hot day, telling parade spectators they were “proof that the great majority of people haven’t lost faith in this country.”
Then Nixon boarded a helicopter and flew off with Rebozo to a private island in the Bahamas owned by his other millionaire crony, Robert Abplanalp, celebrating this weekend, as he did so many others, drinking martinis with his two old pals. Finally alone, having escaped his wife, having escaped the press, having escaped even Haldeman and Ehrlichman, the president got down to private business.
Rebozo gave Nixon the Hughes memo, undoubtedly also brightening the festivities with word that the long-sought payoff had finally been arranged. Then the Cuban placed a call to Las Vegas.
“Howard, Rebozo has transmitted your message on the ABM to the President,” Maheu reported that same day to the penthouse. “He was very appreciative but Rebozo could not tell from the reaction whether or not the President was ready to countermand the position of his Secretary of Defense.”
Nixon, however, was prepared to immediately show his appreciation to Hughes in another way.
“Howard,” Maheu added in the same report, “our present intelligence indicates that the President’s approval of Air West and that of the CAB will come down next week.”
Hughes was, at long last, back in the airline business. Air West was not, of course, TWA. But it was an airline, and Hughes, who had first gained fame as an aviation pioneer, very much wanted to own one again. He had been plotting to take over the struggling little carrier for a year.
“This plan necessitates that the stock edge downward,” he had written at the outset, outlining his scheme to swindle the stockholders, “and then that we come along with a spectacular offer.”
At first it had gone according to plan. When the stock had tumbled to sixteen dollars a share, depressed by a spate of adverse news stories secretly orchestrated by Hughes publicists, the recluse made his offer—twenty-two dollars a share. More than half of the stockholders voted to accept.
But then a stubborn Air West board of directors voted 13–11 to reject Hughes’s bid. “I do not think these selfish bastards are ready to change their position,” Maheu reported. But he had a plan, a phony stockholders’ lawsuit against the directors leading the opposition and a plot to have three front men dump tens of thousands of Air West shares on the market, setting off a panic.
Maheu reported the entire illegal scheme to Hughes:
“As I am sure you know the derivative actions were filed today in Deleware. Tomorrow there will be further actions filed against the 13 Directors in Federal court in New York. The unions will serve notice tomorrow reflecting their complete disgust, and certain machinery has been put into motion to depress the stock so that the Directors who voted against the deal will recognize their individual obligations to the fullest extent.”
The campaign of stock fraud and intimidation was a complete success. The opposition capitulated. And when Hughes finally closed the deal, a loophole in the agreement allowed him to pay not the twenty-two dollars a share promised, but only $8.75.
He had cheated the Air West stockholders of nearly $60 million. And now the airline was finally his, courtesy of Richard Nixon. (As promised July 4 in the message from Rebozo, the CAB approved the takeover July 15, and the president made it final July 21.)
Almost two weeks went by, however, with no response from Nixon on the ABM. Hughes was getting impatient.
“I am disappointed because, since I have no report of the President’s reaction to the paper I wrote, I can only assume he did not ask anybody to read it,” Hughes complained, hardly satisfied with an airline.
“Bob, I have given you unlimited resources financially with which to operate, and I have given you absolute freedom to choose anybody under the sun you might wish to assist you.
“Since I consider I have given you carte blanche, financially, executively. and every other way, I think I am entitled to receive some kind of a report, setting forth in specific terms just what has happened and by whom it was done, and what is being attempted at this time and what is expected to result from same.
“I didn’t spend about 6 hours on that paper just to have it wind up in somebody’s waste basket. If the President could not be bothered to consider this matter, it seems to me it should have been pursued thru somebody else.”
But the president had not forgotten about Hughes. He had asked somebody to read the ABM memo—Henry Kissinger. On July 16, 1969, the same day that the Apollo 11 astronauts blasted off for man’s first walk on the moon, Nixon huddled with his national security adviser. That morning in the Oval Office, just before they shared the historic moment watching the launch together on television, the president told Kissinger to go see Hughes.
Kissinger returned to his White House basement office angry and incredulous. He told his deputy, Alexander Haig, that Nixon had just ordered him to give the billionaire a private top-secret briefing, not only on the ABM but also on the general strategic threat, on the balance of nuclear power—and, as a final outrage, to solicit Hughes’s own views on defense policy.
Although he regularly briefed his own patron, Nelson Rockefeller (who secretly slipped him $50,000 just before he joined the White House staff), Kissinger always bristled at having to service Nixon’s patrons, and he had never before been asked to do anything remotely like this. The Hughes mission really had Kissinger fuming.
“Henry was not particularly impressed with the thought of it,” Haig later recalled. “He was rather cynical about it, somewhat skeptical, wondered whether this sort of activity was the right thing to do.” Others who overheard Kissinger’s tirade say he questioned both the president’s motives and his mental health.
“He’s out of his mind,” yelled Kissinger. “He can’t sell this! I can’t hold private peace talks with Howard Hughes.”
Haig himself seemed to find it all amusing. He emerged from Kissinger’s office waving the Hughes memo in his hand, and told Larry Lynn, a senior aide who handled the ABM, “Guess what’s up now—Howard Hughes is in the act!”
Maheu meanwhile immediately flashed word from Nixon to Rebozo to Danner to the penthouse.
“Howard, we have just been informed that the President will be writing you a letter in the next several days to thank you for your comments on the ABM in your memorandum delivered by Rebozo.
“More importantly, however, is the fact that the President chose to discuss said memo with Dr. Kissinger, his number one technical advisor. Kissinger was very much impressed and admitted that you had covered some concepts which had not come to their attention previously.
“As a result, the President would like to know if he could send Kissinger to Las Vegas to brief you on some new developments and to get the benefit of your thinking.
“As you know, Howard,” added Maheu, dealing delicately with a sensitive point, “because of the direct line from my home to your office (which is 100% secure) such a briefing could take place without the necessity of your having a personal confrontation with Kissinger.”
It was shuttle diplomacy of a new order. Nixon dealing with Hughes as if negotiating nuclear policy with a sovereign power. But the prospect of Kissinger’s visit terrified Hughes. He simply could not deal with an outsider, not even Kissinger, not even by telephone.