Buy a can of PB Blaster and liberally apply it to the cables, and any moving parts that you can readily see.(WD-40 is too "wimpy" to do much good in this situation!) Then, if that fails, turn the machine on its side, and look underneath for a steel plate that should be held on by bolts. This plate covers the main gears and working parts. Check for rusted chains, pulleys, or anything that could hinder the movement of controls, etc. Liberally squirt everything except the belts, and the engine. Allow it to sit and soak, then try to see if it has loosened up.
I would think that the machine has been allowed to sit in the elements, and the previous owner sold it when he couldn't get it to work.
The areas named above usually get lots of snow in them, and that causes rust later on, especially if the machine has been setting for a while.
A word of caution: Always turn this, or any machine, onto its side with the carburetor "UP", to prevent engine oil from getting into the intake side of the engine.
HTH: Rustyj

Good advice, but I would like to add:
don't spray the friction wheel or the
disk it rides on.

if I recall from mine, there is a tension pully. when you press the lever with your hand, you activate the tension pully that applies tension to the belt that turns the impeller. this pully is adjustable to when the lever is not pressed, the motor spins but does not spin the impeller (because the belt is loose). The manual would definitely tell you how to do this as this is a standard snow thrower adjustment. also ariens has great support so you can call them also.

RustyJ, My pair of 30 something Ariens 5hp summers outside under tubs. I tricked one into running long enough to clear my driveway. So I'm happy. In your opinion is an engine like this worth the trouble to rebuild? Or just find a better one?

Well, if it runs--why rebuild it? New engines are expensive! New parts are too. But, they aren't always available.
I usually try to find a good running, used engine, and install it.
I'd do a general clean-up on it, with any parts that need replacing, installed on it.
If you were using it as you do a lawn mower, then maybe a new or rebuilt engine would be ok, but for occasional use--just tune it up with the usual things, and next spring, cover it well with a new tarp, or new wash tubs;0)