TYCOONS: THE HUGHES LEGACY SCRAMBLE FOR THE BILLIONS

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When German submarines sank Allied shipping at an appalling rate during World War II, Hughes advocated the building of a gigantic airplane that could fly troops and cargo to the battle zones far above the reach of U-boats. Since metal was in short supply, he constructed his plane from lumber; hence its nickname, the Spruce Goose. Working in a mammoth hangar, which still stands at a Hughes plant in Culver City, Calif., Hughes built the huge eight-engine flying boat, which was as big as today's Boeing 747.

By the time the Spruce Goose was finished. World War II had long been won. But a Senate subcommittee began investigating whether Hughes through his p.r. man had won rich Government contracts for the Goose and long-range reconnaissance aircraft by lavishly entertaining military officers, including Colonel Elliott Roosevelt, the late President's son. Facing down his congressional critics, Hughes vowed to leave the U.S. if the huge plane failed to fly. On Nov. 2,1947, he flew it—but only for slightly more than a mile off Long Beach, Calif., at an altitude of no higher than 70 ft. The plane was just too unwieldy and dangerous. Today it sits in a specially constructed hangar in Long Beach.

After the war, Hughes foresaw the importance of wedding electronics to weaponry, and bright young scientists flocked to the Hughes Aircraft Co. because he created a questing atmosphere and provided them with the wherewithal to experiment. The company rapidly ex panded, but m the '50s Hughes offended his best scientists by second-guessing them. After many quit, the Air Force threatened to cancel its defense contracts unless Hughes ceased interfering. Partly to reassure the Air Force, as well as to save taxes, he gave the company's stock to the Hughes Medical Institute in 1954, but he still prided himself on its achievements.

He had even sharper ups and downs at Trans World Airlines. With huge infusions of cash, he built it from a small southwestern carrier into a globe girdler. It was also his fief. He chose planes, tinkered with design improvements and harassed TWA's presidents with interminable post-midnight calls. On transcontinental flights, four to six seats were always blocked off for him even though he almost never used them. After Hughes' failure to raise the money for TWA's jet fleet, he lost control of the airline, and the new management hit him with an antitrust suit. Hughes won it in the U.S. Supreme Court. By that time, however, he had sold his huge bloc of TWA at a moment when the market was very high. He got $546 million, but he regretted losing TWA. "It's not mine any more," Hughes would say. "I can't run my hands over it any more."

In much the same way he gained—and lost—Hollywood's RKO. Buying it in 1948, he soon became the only individual to own a major U.S. film studio. He would summon associates to midnight meetings in obscure hotels and sometimes hole up for weeks in a studio screening room, subsisting on cookies and milk while watching nonstop reruns of old flicks. The studio had few postwar hits; its executives revolted; and in disgust Hughes sold RKO in 1954 for a small profit to the General Tire and Rubber Co.

The Looming Conflict