Canada: ONTARIO: Big Business

Twenty years ago a cocky youngster named Clement George McCullagh quit his job as assistant financial editor on the old Toronto Globe, to get into the million-dollar deals that he had been writing about on Toronto's Bay Street. His boss warned him against it, but McCullagh's mind was made up. "The next time I come in," he boasted, "I'll be buying this newspaper out from under you."

Eight years later, he came back with the money ($1,850,000 put up by Gold Mine Owner William Wright), and bought the Globe. He also bought the Globe's morning rival, the Mail & Empire, and merged the two papers into the Globe & Mail, now Canada's biggest (circ. 218,481) morning newspaper, and its best.

Last week, George McCullagh, now 43 and cocky as ever, closed another newspaper deal. For $3,610,000, he bought the 72-year-old Toronto Evening Telegram.* That gave him control of two of the three big daily newspapers in Canada's second city, with a total circulation of 414,515.

The Power. In the grimy Telegram offices on Melinda Street, there was no joy as the staff turned out an early afternoon edition headed McCULLAGH BUYS TELY (changed in a later edition to TELY REMAINS INDEPENDENT). Although McCullagh said that there would be no immediate wholesale firings, his ownership of both the Globe & Mail and the Telegram would cut the field for any ex-staffers to one paper, the Star.

With the Telegram under McCullagh, some of Toronto's politicians were as shaky as the Tely's employees about their future. When he first took charge of the Globe & Mail, McCullagh supported the Liberal Party, though he often needled the government. The final break came in World War II over reinforcements for Canadian troops abroad. Ever since, McCullagh has been plugging the Progressive Conservative line on his editorial page, has become a power in Tory circles. Ownership of the staunchly Tory Telegram makes him still more important in the party. Said one worried Tory: "It's going to be awfully tough on anyone who breaks with George McCullagh."

Able Newspaperman McCullagh decided to get tough first with Toronto's Liberal Star (circ. 369,276), longtime rival of the Telegram, and Canada's biggest newspaper. The Star charged that the Telegram had lost its independence and that McCullagh was a front man "for outside influence and ownership." McCullagh snapped that the Telegram deal was his own. "That fellow Hindmarsh [Harry Comfort Hindmarsh, Star president]," he roared, ". . . is so ugly that if he ever bit himself he'd get hydrophobia."

The Pattern. To fight the Star, McCullagh promised to get the Telegram out of its old rut of playing to Toronto's arch-Tories, Imperialists and anti-Catholic Orange order. Said he: "The Globe & Mail will be the pattern, particularly in such things as ... racial and religious prejudice."

To counter the circulation of the flamboyant Star, Publisher McCullagh would need a big pattern. In twelve years as publisher of the Globe & Mail, he had added only 21,697 to the circulation he started with. In the same period, the highflying Star had caught 121,059 new subscribers; even the slow-poking Telegram had gained 42,290. The figures did not faze bellicose George. Said he: "The smart talk will soon be about the waning Star."