For the General Good: The Debate Over Private vs. Public Ownership of Telephones and the Canadian West, 1900–1912

In opening years of twentieth century, there erupted a controversy on both sides of Canadian-American border that led directly to establishment of government-owned and operated telephone systems in Canada's three prairie provinces between 1905 and 1912. This was increasingly acrimonious debate, starting as early as mid-1880s, over private versus ownership of industries vaguely classified as public utilities. Central to dispute was a fundamental difference in interests that had developed over time between big business and local government with respect to extension of telephone and other works, limits of regulation, and matter of civic jurisdiction. Another contributor to controversy was rising dissatisfaction over high rates and inadequate provided by private utilities companies, whose monopoly agreements with federal, state, or provincial authorities excused them from all further responsibility to community and effectively placed their operations beyond local control. Because their focus was commercial and not social, moreover, these companies concentrated on developing in major urban centers rather than small towns or rural districts in sparsely settled areas like Canadian West, where utilities in general, and telephones in particular, were expensive to build and unprofitable to maintain. Already in 1898, columnist Roderick J. Parke had identified core issue of debate. If it could be demonstrated, he wrote, that private enterprise could supply what he called industrial services as cheaply and economically as through ownership, few people would question continuation of private ownership, providing, of course, that private companies will accede to popular demand. But unfortunately, Parke continued, the local company, secure in monopoly it holds, more often exhibits an utter disregard for rights of public, hence movement for supplying a remedy through municipal ownership. (2) That response was natural, perhaps even inevitable, added Mayor Emerson Coatsworth of Toronto in 1907 at height of controversy, for the people, sweating under exertions of great corporations, turn first to [federal or regional] governments, and finding no redress then look to means within their reach, and only one available is to own and control utility themselves. (3) In underdeveloped areas such as western Canada, ownership of utilities like telephone served an additional social function. It was a primary vehicle to unite small and often remote rural and urban population into self-sustaining, economically viable, and politically vital communities free from interference by federal authorities at Ottawa or large business interests based in eastern Canada, whose grip on regional economy was resented deeply. Thus pitted against each other in escalating quarrel were two antagonistic forces identified by Parke and Coatsworth. On one hand were large monopolistic corporations determined to protect and expand their control of certain free from external interference. On other hand were resentful municipalities equally determined to halt wholesale chartering of service corporations by federal, state, or provincial governments in a concerted campaign to recover lost autonomy within their own jurisdictions. Connected to, and forming part of, this bitter feud were practical, yet nonetheless serious questions about quality and safety of specific provided, especially in relation to allegedly exorbitant fees paid by individual subscribers. (4) In Canada, national controversy soon extended to provincial level in West in particular, where it acquired additional significance. Historically, chief goal of ownership in three prairie provinces as it affected telephone development in first decade of twentieth century was to provide service to whole population--both urban and rural--at a reasonable price. …

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