Howard Hughes: Patron Of Science?

Medical Research Institute Is America's Second Largest Charity

It's very likely that Hughes didn't mean for all of this to happen. And that's where our science story gets juicy.

"He was a playboy, he was a world-class pilot. He dated Bette Davis, Katherine Hepburn, Ginger Rogers, Ava Gardner, Rita Hayworth, in the same week," says author Richard Hack, who has written two biographies of Hughes.

Hollywood was his playground, but Hughes came to fame as a record-setting pilot, and it was his Hughes Aircraft Company that turned him into a billionaire. His most famous plane, the "Spruce Goose," was a giant wooden seaplane that flew just once, with Hughes at the controls. Despite that flop, Hughes Aircraft still became one of America's biggest defense contractors.

"The company originally started to make airplanes and then it maneuvered itself into guidance systems. So it was a very important element of the Air Force," says Hack.

But the world's richest man wasn't your average government contractor. He was combative and he bullied Pentagon officials. A newsreel from 1947 showed him lambasting a U.S. senator who had the audacity to challenge him.

By 1953, the temperamental Hughes had begun to withdraw from public view. His own executives at Hughes Aircraft often couldn't reach him, and he cut off contact with the Air Force.

At some point the Air Force decided that Hughes was a liability to his own company, and delivered an ultimatum. "It was at the Beverly Hills Hotel and the Secretary of the Air Force came and demanded to see Howard Hughes, who kept him waiting for an hour and a half," says Hack. "The secretary of the Air Force came in and said, 'You either put control of this company under somebody that I am going to tell you to hire, or we are removing every single contract from Hughes Aircraft.' Gave 'em 90 days."

What happened next? In exactly 90 days, Hughes created the Howard Hughes Medical Institute, says Hack. "This was one wily move. By giving the new Institute 100 percent ownership of Hughes Aircraft, Hughes got out from under the Air Force ultimatum and built a giant tax shelter for the company's profits."

Because it was a medical institute, it was all tax-free. It was a charity. Even though they did no research. Plus, there were no personnel, and the only trustee was Howard Hughes, says Hack.

When the IRS challenged the institute, it did begin to fund some research, but for many years, as Hughes retreated further into isolation and illness, more money went to him than to science.

"He did black out the windows. He did live by himself. He didn't even walk to the bathroom, he was carried to the bathroom from bed," says Hack. "He didn't dress, let alone bathe. The fact is the man had enough money that if he didn't want to get up out of bed, he didn't. And in fact, he didn't."

Hughes died without a will in 1976, and the Institute was mired in years of litigation. Finally, in 1984, a court appointed new trustees, and they promptly sold Hughes Aircraft to General Motors for $5 billion. Suddenly, an institute created basically as a sham became the richest charity America had ever seen.