Arizona republican., 1912-06-17
Discovery of Graft in the Purchase and Manage ment of Line of Govern ment Owned Grain Ele- vators and Telephones
ROYAL COMMISSION
 UNEARTHS SCANDAL,
In Spite of Fact That They Were Owned by "the People" Rates Went Up and Taxes for Their Maintenance

4'ASt111OCllClIlCC
 WINNIPEG, June 16.-Americans ms coming into Canada where they have been led to believe governmental con ditions are so much superior to those in the United States are, upon their arrival in Winnipeg; now being given an insight into the manner in which the Canadian government operates the affairs of it's state owned utilities which does not. by any means. bear out the claims of the superiority of the government of the great northern neighbor nor of it's ability to operate a government monopoly of public ser vice concerns with anything like the results credited to it.
 Although the scandals now being brought to light by a royal commits sion has shaken Manitoba business and politics to the foundation, prac- tically nothing of it has reached the United States. The reason for this is that local pride has succeeded in suppressing the condition from Ameri- can newspapers. One of the standard subjects of Canadian attack on the United States has been alleged cor ruptiOn in municipal, state and gov ernment matters, and to have q worse state of affairs than anything charged against American public officials brought to light right at home was anything but agreeable matter to have spread in Yankee newspapers. But so far as this instance is con- cerned, all theoretica objections to government ownership have by actual facts been demonstrated to be sound.
 Four years ago Manitoba went into government ownership by installing a line of grain elevators and practi- cally forcing all privately owned tele phone exchanges in the province to sell to a government system which was being organized. The biggest of these plants, the Winnipeg company was American owned operated. The provincial government took a blub, went after the Americans and threat ened to parallel their lines if they did not sell. The Americans sold, but having to deal with government agents handling other peoples money instead of their own, they got mil lion dollars or so more than any level headed business man would have paid for the plant
 Then, having acquired a number of other exchanges throughout the pro- vince, the state telephone company started business with a flourish. From time to time glowing reports were made of the success of the system and all went well until some months ago when the telephone commission suddenly announced a tremendous in crease in rates.
 Half the towns in the province ap pointed commissions to see why the increase was necessary. The tumut became so great that Premier Rob lin appointed a crown non- partisan commission to investigate the whole question. It is the many scandals brought out by this royal commission which is giving Americans the chance to return to Canadians the many gibes which this country has for so long thrown at the great republic to the south when the question of the conduct of municipal and state af- fairs were under discussion AL though owned by the government for less than four years, the disclosures before the commission show the en- tire system to be permeated with graft, incompetence and scandal. AS soon as the announcement of an in vestieatiOn was made; one of the tel 1 enhone commissioners resigned One emnIOve has been arrested on graft charge and other arrests are to fol- l low. In every department was found scandal. The purchasing department admitted having bought at one time, | $500 900 worth of supplies when were not needed The construction department told of running lines one day and taking them down the fol- l lowing day. One line seventeen miles long was built in order that one GUS toner might be served. Materials were wasted; time was killed" In the auditing department were found raised vouchers, and vouchers which l had been signed in blank and after i wards filled in as the holder wished. l The accounting department accepted without question such sums as were remitted for long distance calls by branch managers. In all the three years there had been no general checking up of the system
 The scandal reached the provincial parliament and became the question of the hour. Member McPherson, from the floor charged that the peo- nle had been grossly deceived. They | were led. he said. to believe there 1youId be from 1911 operation, a sur plus of $300, 0,0O0 Instead there was a big deficit. T. H. Johnson. another member made the charge the labors
 p1pa E1