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Barons versus Bureaucrats
The History of the Grain Trade in
North America and Australia
Nick Cater
The pioneers of American industrialization get a bad press. The sobriquet
‘robber barons’carries an imputation of theft, and reflects the widespread
view that their wealth was accumulated dishonourably at the expense of the
common good. The innovation, growth, and prosperity they stimulated seems
easily forgotten.
In Australia, economic expansion in the late nineteenth and early twentieth
centuries relied less on individual initiative and more heavily on state spon-
sorship. Infrastructure was paid for with government borrowings, wages and
conditions were heavily regulated, and key industries were state controlled. As
in the USA,‘the motive power of human progress’(Menzies [1942] 1980, p. 60)
was individual ambition, but colonial governments in Australia assumed
a central role in national development.
The expansion of grain production in North America and Australia, begin-
ning in the second half of the nineteenth century, allows us to compare
contrasting approaches to developing the New World. One might be charac-
terized as baronial; the other bureaucratic. In America, risk-takers took advan-
tage of a lightly regulated economy and pushed back the boundaries of the
frontier. They invested in technology, developed sophisticated trading sys-
tems, and embraced competition, to drive down margins and costs.
In Australia, by contrast, a system of‘colonial socialism’emerged in the
eastern colonies between 1860 and 1890. The railways that made large-scale
cultivation of grain feasible werefinanced, built, and operated by government,
an arrangement uncommon at the time (Ergas and Pincus 2015). Australian
farmers looked to the benevolence of the state to protect their interests to a