The Great Casino Salesman

  • These days Las Vegas has become so sanitized that some casino operators are complaining. The city's largest hotel, the Excalibur, is a medieval castle that looks like Cinderella's at Disney World. The hotel that Bugsy Siegel built, the Flamingo, is now owned by Hilton. Characters like Benny Binion, who bragged of killing those who crossed him, and Bill Harrah, who in his 60s drag-raced with teenagers on Reno streets, have been displaced by quiet, invisible graduates of business schools. The last convicted felon to be spotted by a local columnist on the Strip was Michael Milken, the junk-bond king. "What this town needs," says Bob Stupak, the crusty owner of Vegas World, "is that scent of vice, a little sin, to stir that desire to come to Las Vegas."

    What Las Vegas has instead is Steve Wynn, a casino king who is the son of a compulsive gambler and has an eye disease that could make him blind; who in his late 30s took up steer roping, wind surfing, rock climbing, motocrossing, jet skiing and body building; who once called Donald Trump "twinkle toes"; who let Frank Sinatra pinch his cheek in a commercial for his casinos; who divorced his wife, never moved out and remarried her five years later; and who shot off his index finger two years ago while handling a pistol in his office.

    But that is not what makes Wynn interesting. He is on a mission to gentrify gambling in America, cleansing it of its associations with high life and low life while delivering it to a suburb near yours as the innocuous extension of the middle-class weekend outing. Wynn's gambling has neither neon, push-up bras nor black-tie croupiers from the French Riviera. In fact it is not even called gambling. "I'm in the recreation business," he insists.

    In many ways, Wynn represents the new face of gambling in America, ingratiating and scrubbed, ready to join with Reagan's "Morning in America" adman to soften resistance to what once was considered a slightly sinful indulgence. Partly because of salesmen like him, gambling is spreading so quickly and quietly across the country these days, says David Johnston, the author of Temples of Chance, that "few people realize Minnesota has more casinos than Atlantic City." The business has exploded in just over a decade, with casino revenues going from $2 billion a year in 1978 to nearly $10 billion today. In 1990 there were just three states with casinos, not counting those on Indian reservations; now there are 16.

    Even the most stalwart opponents of gambling are breaking down. Louisiana, whose constitution orders the legislature to "suppress" gambling, decided to call it something else and in less than two years has gone from no gambling to riverboat gambling to approving the largest casino in the world on five riverfront acres in downtown New Orleans. Last fall the Bible Belt state of Missouri became a destination for riverboat gamblers off the shores of Kansas City and St. Louis. By the turn of the century, half of the states or more will probably have casinos, in part because of a 1987 U.S. Supreme Court decision that recognized the right of Indian tribes to offer gambling games on their reservations. There are efforts to build casinos in downtown Detroit and Chicago, in pastoral New Hampshire and Maine, in the desert elegance of California's Palm Springs, at historic Penn's Landing in Philadelphia, and on the lakefront sites of abandoned steel mills in Gary, Indiana. Some entrepreneurs are even talking of the day when Americans will find video slot machines at every local bar or bet from their living rooms through interactive television.

    In this crowded field, Wynn stands out not because he owns the nation's biggest casino company (Caesars is, with revenues last year of $928.5 million in contrast to $833 million for Wynn's Mirage Resorts Inc.) or because he is the first to think of inserting family fun into betting parlors (Circus Circus Enterprises Inc. did in the mid-'70s, with acrobats and clowns performing above the casino floor). But he is the first to apply to gambling the Disney formula for class-crossing, universal family leisure: cleanliness, measured frivolity and a sense of architectural detail. In the right environment, he argues, everybody and nobody is a gambler. "This place is filled with people like me and you -- none of whom think of themselves as gamblers," he says from his casino office. "They think of themselves as folks who are on vacation, and while they're here -- hey, let's put some money in the slot machine."

    The Wynn philosophy seems to work. His three-year-old, $730 million casino in Las Vegas, the Mirage, is the biggest moneymaker on the Strip, at least in part because patrons come to see the man-made volcano out front that erupts at night every 15 minutes, the sharks swimming behind the registration desk, the white tigers lounging below Roman columns in their glass cage and the dolphins in the seaquarium. His new Treasure Island casino, to open in October, will re-create at hourly intervals a cannon fight between two battleships and offer a permanent home to the elegant Cirque du Soleil. If Wynn gets his way, he will be permitted to build two casinos in Connecticut that will mix betting with moviegoing, ice skating and line dancing. And his next project in Las Vegas will envelop gambling inside a 160-acre resort that will include a golf course, intimate villages, a replica of Rick's Cafe Americain (the gambling joint from the movie Casablanca,) and a 14-acre lake where visitors can water- ski during the day and watch a laser show at night.

    Wynn's ambitions command attention because he has scored one success after another, even if his first Las Vegas venture was a flop. At 25, he took money he had made in his family's bingo business in Maryland and invested $45,000 to purchase a 3% interest in the Frontier Hotel, where he became the slot manager. But several stockholders of the hotel turned out to be stand-ins for Detroit mobsters, and Wynn was forced to sell early. He was never accused of being anything but an innocent in the affair, and he did get something invaluable out of it: a friendship with the most powerful banker in Las Vegas, E. Parry Thomas. Wynn came to his attention partly because he stood out in the Las Vegas of the late '60s: he was young, fit, wore understated tailor-made suits, had the vocabulary of the English major he had been at the University of Pennsylvania, and had a wife so pretty she had once been voted Miss Miami Beach.

    Thomas first set up Wynn in a liquor distributorship and then arranged for him to buy a tiny parcel next to Caesars Palace that was owned by Howard Hughes. News of the sale to Wynn made front-page headlines because it was the first piece of Las Vegas property the reclusive Hughes had ever sold; what also got noticed was the price Caesars paid for the lot 11 months later to keep Wynn from building his own casino there ($2.25 million). Wynn walked away with a nice $766,000 profit. He used that money to accumulate more stock in the aging Golden Nugget casino downtown, got on the board and almost immediately began to investigate the operation. He found that everyone from parking attendants to bartenders was stealing money. With that evidence, he staged a takeover by threatening to sue for mismanagement and, at 31, became the youngest casino chairman in the history of Las Vegas.

    In June 1978 he went to Atlantic City, where the first casino had just opened. "I had never seen anything like it," he says. "It made Caesars Palace on New Year's Eve look like it was closed for lunch." Wearing shorts, sandals and a Willie Nelson T shirt, he walked down the Boardwalk to the old Strand Motel; less than an hour later, he walked out having agreed to buy it for $8.5 million in cash. Wynn razed the Strand and built the 506-room Golden Nugget, which quickly exceeded by 50% the revenues it was projected to make based on its size.

    In 1987 he sold out to Bally's for a record $440 million. The timing of Wynn's departure from Atlantic City was perfect: within a few months the overbuilt resort began a long slide. By then, Wynn was already focused on his plans for the Mirage in Las Vegas. To build the 3,000-room hotel, he pushed the company's total 1990 debt load to more than $1 billion. He spend $45 million to build a golf course exclusively for high rollers that he lined with 21,000 pine trees trucked in from California and Arizona. The risk paid off: in 1991, the Mirage's second year, operating cash flow hit $201 million, a record for a single casino.

    In many ways, Wynn is a hybrid of the old and new Las Vegas. He came to Las Vegas at a time when banks like Thomas' relied for some of their deposits on the Mob-controlled Teamsters Central States Pension Fund. But Wynn was also one of the first Las Vegas entrepreneurs to turn to Milken's junk bonds when it came time to build Atlantic City's Golden Nugget. He still refers to a casino as "the joint." But he was also the first in the business to decide to turn up the lights on the casino floor, and the only one ever to write a ballet about the history of Las Vegas. In his name dropping, he is just as likely to mention Harvard paleontologist Stephen Jay Gould as he is Sinatra.

    On the one hand, he donates money for college scholarships, organizes massive registration drives among his employees, endows university chairs and sends out a newsletter to senior citizens that features everything from pending state legislation to muffin recipes. On the other hand, Wynn continues to make headlines for investigations into the possible organized-crime connections of some of his top employees. Just last week he appeared before the Nevada Gaming Commission to defend his father's bookmaker, Charles Meyerson, whom Steve hired 13 years ago as a host for Atlantic City's Golden Nugget and who is paid $400,000 a year today to do the same job for the Mirage. Police had alleged that Meyerson arranged for free hotel rooms, food and beverage for 59 mobsters and convicted criminals since the 1980s, including three men connected to the Genovese crime family who showed up at the Mirage last July. Wynn argued that Meyerson had no special relationship with any of these clients, and on Thursday the commission agreed with him, voting unanimously to issue Meyerson a license.

    Meyerson, however, is not the only top executive Wynn has hired who has caused him headline problems. The one he calls "the most embarrassing in my career," for instance, was the time he was forced to fire his vice president of marketing at the Atlantic City Golden Nugget after investigators found out he had visited on two occasions "Fat" Tony Salerno, the reputed boss of the Genovese family.

    These days, however, it is Wynn's personality that is on trial. Many people know Wynn as a witty storyteller who can mimic anyone's accent and who rewards his employees with gifts (he once bought luxury cars for 377 casino supervisors in Atlantic City). But a lawsuit by the former head of Wynn's Golden Nugget casino in Las Vegas, Dennis Gomes, has laid out what colleagues and even some relatives of Wynn's have said about him privately for years: he has a tendency to explode at the people around him. There are many offenses Gomes lists in his lawsuit, including using the company's contractors and its jet for personal reasons; routinely harassing female employees; ordering executives to obtain the phone numbers of cocktail waitresses; and referring to blacks, and employees in general, as "niggers." The lawsuit also addresses the infamous Wynn outbursts, as in the time he "started becoming very upset with a casino executive, and . . . his eyes bulged, and he started screaming at the top of his lungs and banging his head on the table."

    Wynn has denied the accusations, and his allies argue that the Gomes lawsuit was a desperate response to the one filed by Wynn for breach of contract when Gomes quit to go work for more money as president of Donald Trump's Taj Mahal in Atlantic City. But Wynn does not deny that he has a temper."You know where a temper comes from? Being able to get away with it." He laughs. "I'm a self-made brat. I'm like everybody else: I want to get away with it if I can. I've been indulged."

    Among the things he gets away with: throwing a chair at his brother Kenneth, who heads the company's design-and-construction subsidiary; ordering an executive to fly in for a meeting and then leaving him stranded as Wynn flies off to Los Angeles for a haircut; offering paternal words of forgiveness to a transgressing employee and, with a string of expletives, ordering him fired the minute the door is closed. "He consumes everyone's dignity around him," says Lester Colodny, who designed the famous ads that featured Wynn and Sinatra. "Once on a trip I was talking to Steve about becoming a regular . employee. We stopped at McDonald's, he got out, and his wife said to me, 'Lester, don't become a hired hand. Remain a consultant. Right now you are the new girl in town and he loves you. The minute he has you he'll break your heart.' I signed a contract, got stock options, got a big salary and a broken heart."

    There are reasons why Wynn was spoiled. His mother Zelma had a miscarriage prior to his birth; the baby who came after him died eight hours after being born. His brother Kenneth was born a decade later. So Wynn, a child his mother describes as precocious and sometimes devilish, was not just an ordinary firstborn: he was a sacred child. Meanwhile his father, Michael, was often away from their home in Utica, New York, supervising bingo parlors he owned in three states. "Steve ruled the roost," says Wynn's wife Elaine. "Mike was not home, meaning that there was no paternal supervision. Zelma was a pussycat. She didn't have the -- I don't want to say the knowledge or instincts -- but maybe not the patience to deal with Steve."

    The young Wynn was one of the only teenagers at the family's summer retreat at Old Forge, New York, who had a motorboat, which he sometimes used with his hell-raising friends to splash the docks while people were sunbathing. When he was at home, Steve's father dominated the household with his hyperactivity (he could not sit still for a conversation), his romantic streak (he once turned the banks of a lake into an open-air movie studio with multiple cameras so that he could film his son ski jumping) and his mixture of gentleness and bombast. One of Steve Wynn's childhood friends, John Meagher, recalls wanting to leave the Wynn home after two days. "They were screaming at each other. I told my parents and they said, 'That's the way they are. They scream at each other. It doesn't mean anything.' "

    Michael Wynn's legacy was, at the very least, ambiguous. He offered his son a friendship, in which the young Wynn sometimes called his father by his first name and followed him at age 10 to Las Vegas for two magical weeks of a bingo venture that ultimately failed. But their closeness left Steve without his favorite hero when his father died in 1963. In every office Steve has ever had, a picture of Michael hangs on the wall. "I'd give up everything for 15 minutes with my father," he once said. "To have him walk through this hotel and see what happened."

    From his father, Wynn inherited both a post-Depression-era taste for the good things (Michael, too, never wore anything but custom-made suits) and for education as the guarantee to economic stability; it was Steve who insisted he wanted to attend Manlius School, a military prep school for West Point. Perhaps, above all, Wynn was marked by his father's compulsive gambling. "There is something about children who grow up in that environment that hungers for stability," says Elaine, whose father also was a compulsive gambler. On the eve of the cancer surgery that failed to save his father, Steve sat by his father's bed and took down a list of his gambling debts -- a total of at least $200,000. It took Steve and his mother 4 1/2 years to pay them off with revenues from the bingo business. Wynn has often said since that the only way to make money in a casino is to own one.

    Wynn's need to drive his own destiny grew more urgent, say several relatives, after he was diagnosed as having retinitis pigmentosa, a degenerative eye disease that makes it hard for him to see down or at night, occasionally causes him to crash into glass doors and tends to lead to blindness. When he heard the diagnosis at age 29, says his mother, he was "devastated," and over time his behavior changed. "The rages are more since he can't see," she says. "There's an expression in business, 'I want to sit down and talk to him eyeball to eyeball.' Well, he can no longer do that. He has to rely on other people to do it . . . He's so frustrated. This is how he gets rid of his frustration."

    Wynn insists the disease is not part of what motivates him to move fast. But when he tries to explain his nuclear personality, the subject, obliquely, is what he cannot see. "I'm harsh because I'm frightened that in my isolation as a chairman who doesn't see everything the bigger we get, that basically I don't really know what's going on," he says. Ironically, the lack of clarity in his physical vision has kept sharp his animal-like intuition about gambling parlors. In the early days of teaching his kid brother about the bingo business, he would say, "You want to walk around and have the sniff of the place." It also makes him, for all his demons, strangely lucid about himself. He has always said his epitaph should read, RUNNING SCARED, STRAIGHT AHEAD. And he is right.


    CREDIT: TIME Graphic by Steve Hart. Source: Christiansen/Cummings Assoc., Inc. for Gaming and Wagering Business Magazine. CAPTION: RAKING IT IN