A caption accompanying a Dec. 27 article on the Stoney Indians of Canada identified the person in a photograph as Stoney chief John Snow. The photo actually showed former Stoney chief Frank Kaquitts. Snow's photo appears above. Kaquitts's name was also misspelled in the article. (Published 01/06/2000)

On a Sunday night in May 1998, Sherman Labelle hitched a ride to his cousins' house on the scenic and oil-rich Stoney Indian Reserve on the eastern edge of the Canadian Rockies. Sherman gave his uncle Conal a hug, told him he loved him, went outside, stood on a pail and hanged himself from a tree. He was 17 years old and stinking drunk.

The inquiry into Labelle's death might well have been routine for local magistrate John Reilly. Since 1990 there had been 120 drug- and alcohol-related deaths on the Stoney Reserve, most of them involving young adults.

But Reilly was unprepared to let this incident pass as simply another unavoidable tragedy in the long, tragic history of the North American Indian. Nor was he willing to abide by the unwritten rule in Canadian politics that it is impolite to criticize aboriginal people or their culture. In a blistering decision issued in September, Reilly laid the blame for Labelle's death at the feet of corrupt tribal leaders and indifferent federal bureaucrats. His crusade has touched off a nationwide debate about government policies that are designed to foster native self-determination but may condemn another generation of Indians to lives of dependency and despair.

"Why is it that conditions on the Stoney Reserve . . . can be found on almost every reserve in Alberta, if not in Canada?" asked Chief Norman O-Soneskoopenace of the Bobtail Tribe in a column in the Calgary Herald shortly after Reilly's decision.

The social conditions found at Stoney and on many Canadian reservations are comparable to those in the worst U.S. inner-city ghettos. Stoney has a population of 3,300, and Reilly found that well over half of the adults are unemployed, and 60 percent of households receive welfare. Among young adults, rates of alcoholism and drug abuse are estimated to run to 90 percent, and the average adult has about a seventh-grade education. Crime rates are five times higher than in the surrounding white community, suicide rates 10 times higher.

But what struck Reilly about the Labelle case was the near-total absence of effective services to deal with the young man's situation. In the four years since his mother died in May 1994, Labelle had been shuttled to 16 foster homes by social workers who testified they were mostly untrained and poorly managed. Labelle's alcoholism had gone largely untreated, in part because a residential program had been closed down two years before in the wake of a sexual abuse scandal. And following the Stoney school committee's decision to close what had been a successful alternative education program for dropouts and troubled youth, administrators arranged for home schooling, which turned out to be almost nothing at all.

This lack of services did not necessarily reflect a lack of money. Thanks to oil and gas royalties and a generous array of government programs, the Stoney tribe is among Canada's wealthiest, posting revenues of $30 million last year--about $10,000 for every resident. But rather than use its funds for needed social programs, Reilly charged that the Stoney chiefs had diverted much of it to benefit themselves, their relatives and the families that kept them in office.

The Labelle case was not the first time that Reilly had taken on the Stoneys and the Department of Indian Affairs. A year earlier, in response to a routine domestic abuse case, he had ordered provincial prosecutors to investigate political corruption on the reserve, pointing an accusatory finger at Chief John Snow, an ordained minister and national leader in the Indian rights movement who had dominated politics here for nearly 30 years. Reilly charged that, under Snow, the Stoney reserve had been made into a "prison without bars," run like "the dictatorship of a banana republic." Indian leaders and government officials reacted angrily to Reilly's harsh language and his intrusion into their turf. Snow called the ruling "inappropriate, false and racist," while in Ottawa, the minister of Indian affairs said there would be nothing to gain by an inquiry that aired the Stoneys' "dirty laundry" in public.

Back home, the chief judge of the Alberta Provincial Court, calling Reilly's rulings "the most atrocious judgment that I have seen," ordered his transfer to Calgary, where he would have no jurisdiction over Stoney matters.

Events, however, conspired to keep the controversy alive.

In a four-month period, six more young Stoneys died from traffic accidents, suicide, homicide or disease, all of them connected to drugs or alcohol.

And outside auditors found a widespread pattern of Stoney reserve mismanagement that had led to bloated payrolls, uncontrolled welfare payments and a contracting process that operated without controls or competitive bidding. As a result, the Department of Indian Affairs stripped the three elected Stoney chiefs of their power, and 47 cases of possible criminal fraud were referred to the Royal Canadian Mounted Police for further investigation.

Meanwhile, an appeals court, while scolding Reilly for overstepping his authority and making a number of unsubstantiated accusations against Snow, ruled that his transfer flagrantly violated his judicial independence. He was ordered back to his old court in nearby Canmore, where he sits today. He declined to be interviewed, however, while the province's Judicial Council considers a formal complaint against him from the Stoney chiefs.

These days, a visit to the reserve reveals a community deeply divided and conflicted.

While many Stoneys are frustrated by the reserve's social conditions, they are also angry and ashamed that they have been portrayed as corrupt and profligate social misfits. While declining to give their names, many acknowledge they are afraid to criticize Snow out of fear that they, or their relatives, will lose jobs or get bumped from the waiting list for new housing. But at the same time, many still regard Snow as the tribe's natural leader and protector against a white society they fear is waiting to abrogate their treaty rights and steal their land.

"We're lost between the two cultures," explained Frank Kuquit, 74, who starred in several movies shot on the Stoney reserve, including "Little Big Man." "We're not good enough Indians and we're not good enough whites."

In fact, many Stoney residents still don't understand what the fuss is about. With so many unable to work off the reservation because of a lack of skills, it seems only natural that they rely on tribal revenues for their livelihoods.

And Stoneys acknowledge that while favoritism is rampant, there's nothing new in that.

"All these years, our system out here has been built on nepotism," said Aaron Young, 34, one of the reformers on the tribal council. "The chief has been able to gain ultimate power over people through money. He has everyone begging for money."

Under pressure from Indian Affairs, the Stoneys is paring the payroll of 660 to around 400, and for the first time, all tribal members will have access to information on tribal revenues and expenditures.

But old practices die hard. Snow's daughters, for example, continue to head the training and health departments, for which they have few qualifications, while his sons serve as director of oil and gas operations and editor of the tribe's only newspaper. And one of his campaign managers was assistant director of social services until it was revealed that she was drawing welfare as well as her paycheck.

In an interview at the tribe's bucolic (and money-losing) Nakoda Lodge, Snow explained that the Stoneys' problems had been blown out of proportion by political opponents, a racist media and white officials such as Reilly who do not understand "the Stoney way." But from his answers it was clear that the Stoney way involves a stubbornly partisan perspective on things. Asked, for example, why he shut down the alternative education program that had attracted more than 100 dropouts back to high school with its inventive mix of new math and traditional healing circles, the chief replied, "How many John Snow supporters do you suppose were in that program?"

At the regional offices of the Department of Indian Affairs in Calgary, officials remain equally defensive. The Stoney imbroglio has raised questions about their department's sprawling bureaucracy and $4 billion budget. But to hear it from department officials, the dysfunctional state of affairs on many reservations is the natural consequence of moving from a system in which white Indian agents ran every aspect of reservation life to a model of self-government that has yet to fully take root.

"We're caught; we're in a bind," said Fred Jobin, the department official who has been assigned the Stoney file. "Sure it would be easier for us to step in and run things. But we've been down that road before and we know that doesn't work either. . . . There is only so much an outsider can do. In the end, the Stoneys themselves have to take control of this."

CAPTION: In a scathing ruling, magistrate John Reilly, shown in the Stoney Indian Reserve cemetery, blamed a young Indian's death on corrupt tribal leaders and an indifferent bureaucracy.

CAPTION: John Snow, chief of the Stoney Indians, says problems on his reservation have been exaggerated by white people who fail to understand "the Stoney way."