Ars Gratia Goldwyn : GOLDWYN : A Biography <i> by A. Scott Berg (Alfred A. Knopf: $24.95; 555 pp.) </i>

Sam Goldwyn, one of Hollywood’s last founding fathers, was a hard, arrogant and ruthless man. He was a chronic liar, and compulsively rude. He cheated at cards. He cheated at croquet. He cheated on his wives. He may not have actually said the notorious “Goldwynism” that “a verbal agreement isn’t worth the paper it’s written on,” but it expressed his general view of ethics in business. He also reneged on alimony payments to his first wife and child-support payments for his daughter. He refused his dying sister’s request to visit her in the hospital. And of all his quarrels with his partners and employees, F. Scott Fitzgerald summed up everything when he wrote in his notes for “The Last Tycoon,” “You always knew where you stood with Goldwyn--nowhere.”

Despite this appalling personality, or perhaps because of it, Goldwyn was central to the history of Hollywood. Indeed, this family-sponsored biography, which is cruelly thorough but nonetheless fair, reminds us how central he was. He put up half the money and most of the managerial skill to create the company--eventually to become Paramount--that produced one of Hollywood’s first features, “The Squaw Man,” back in 1913. Originally, Schmuel Gelbfisz, then Goldfish, he merged with a partner named Selwyn to provide the middle name in Metro-Goldwyn-Mayer, and it was the Goldwyn Co. that contributed the MGM lion and the unworldly slogan, Ars Gratia Artis . After the inevitable quarrel with Louis B. Mayer, Goldwyn became the major producer in United Artists, and from then on all his movies were his own. That was his maverick trademark. Of the 79 movies he made over the next half a century, Goldwyn, unlike all the famous studio bosses, financed every one himself and owned the finished films outright. In every way the classic independent, he was also one of the few producers who resisted the blacklist. And when he died in his early 90s (he lied about his age too), this one-time glove salesman left an estate worth not less than $20 million and potentially a lot more.

A. Scott Berg, known primarily for his prize-winning biography of the Scribner’s editor, Max Perkins, retells this fascinating though somewhat familiar history with a diligence worthy of a biography of Napoleon. In a generally workmanlike prose that only occasionally lapses into Hollywood phrases like one of the most auspicious debuts in motion picture history, Berg reports on virtually every Goldwyn movie, every lawsuit, every quarrel with every contract player. Not content with that, he periodically inserts sections on how the rest of Hollywood was faring, as though a biography of Napoleon were to include activities in all the capitals of Europe. The moguls may have stood tall, but not that tall.

There are continuing arguments about these Hollywood founding fathers: Goldwyn and Mayer, the Warner brothers and the Cohn brothers, all the impoverished and semiliterate Jewish immigrants who created and dominated the most important American art form of this century. Were they, as they themselves liked to think, geniuses of finance and showmanship, or were they primarily bruisers and boors, monopolists, throat-cutters? Goldwyn’s long and turbulent life, as Berg’s biography makes clear in sometimes wearying detail, demonstrates that there is no contradiction between these differing verdicts. Billy Wilder, whom Goldwyn cheated out of $1,000, called him “a titan with an empty head.”

Goldwyn, like the others, made his share of dumb mistakes. He rejected, for example, both “For Whom the Bell Tolls” and “The Grapes of Wrath.” He rejected Betty Grable, for that matter, but wasted a fortune trying to make a star out of Anna Sten, a handsome Russian who could speak no English. Indeed, if you ask anybody what the famous Sam Goldwyn actually did , many people remember that his unschooled English supposedly resulted in pronouncements like “Include me out,” but very few can actually name the movies that he produced.

This is unfair. Goldwyn’s collection of four score films included lots of rubbish, and his constant boasting about “quality” was mostly boasting, but still he did make, for example, “Wuthering Heights” (which he always called “Withering Heights”) and “The Little Foxes” (which he always called “The Three Little Foxes”) and finally “The Best Years of Our Lives.” But that is not quite true either. It was Robert Sherwood who wrote “Best Years,” and Gregg Toland who filmed it, and William Wyler who directed it, just as he had directed both “Wuthering Heights” and “The Little Foxes” (from fine scripts by Ben Hecht and Charles MacArthur and Lillian Hellman). “Tell me,” Wyler once asked an interviewer who was inquiring about the so-called “Goldwyn touch,” “which pictures have ‘the Goldwyn touch’ that I didn’t direct?”

So exactly what did Goldwyn do? Well, he put up the money. He hired Sherwood and Wyler for “Best Years” (the original idea came from Goldwyn’s wife), and he also prevented Wyler from tampering with Sherwood’s script. Though he couldn’t write or direct or do anything else involved in creating movies, Goldwyn did indeed supervise those who could. This was sometimes beneficial, as with the Sherwood script, sometimes not. After Wyler had finished “Wuthering Heights,” the sneak previews did poorly, so Goldwyn decided that “people don’t want to look at a corpse at the end of a picture.” Over Wyler’s loud protests, he hired another director to shoot a final sequence in which the ghosts of Laurence Olivier and Merle Oberon (both of whom had by then left Los Angeles) walk hand in hand toward heaven. “It’s a horrible shot,” said Wyler. In his last years, when Goldwyn could do little more than sit at home and rescreen his old pictures, he watched “Wuthering Heights” over and over again, and it always made him cry.

Well, it had been a hard life. Schmuel Gelbfisz, ugly and unloved, had been only about 16 when he left his home in Warsaw and began walking the 500 miles to Hamburg. He probably stole the money for his boat fare to Canada and probably entered the United States illegally in the course of walking from Halifax to New York, penniless in midwinter. The end was hard too. Goldwyn was past 90, bed-ridden and partly paralyzed by a stroke when he learned that President Nixon wanted to come and visit him. Propped up in a wheelchair, Goldwyn stared vacantly into space while Nixon uttered complimentary platitudes and then draped a Medal of Freedom around his neck. Goldwyn roused himself enough to growl into the President’s ear, “You’ll have to do better than that if you want to carry California.” The embarrassed President later asked Goldwyn’s son whether he had heard what the old man had said. The younger Goldwyn diplomatically pretended that he had not. “He said,” Nixon declared, “ ‘I want you to go out there and beat those bastards.’ ”