imports; against wage rates set in the market; and, compounded with racism,
against low-wage immigration. Moreover, private businesses grew accustomed
to look to government for many of their productive needs, rather than to
other businesses.
The greatest long-term threat to the economic viability of railways was the
increasing competition from new and improving forms of transport and
travel, motor trucks, motorcars, and aeroplanes. Branch rail lines had been
built on the assumption that it was unprofitable to cart produce other than
wool more than about 20 km. When road transport became cheaper than
rail for low-density traffic, it would have improved thefinancial results of rail
to have closed a considerable number of lines. However, by the 1960s, very
few had been closed, due to local lobbying (Hunter 1965, p. 94).
In the USA, the railways were singularly unsuccessful in resisting the
building of highways parallel to their lines; in contrast, Argentina, with its
now nationalized system, planned to build highways to feed rail or ports
(Duncan 1937, p. 572). In Australia, the dual roles of the state governments
clashed. As owner of the rural railways, the states vigorously restricted the
competition of road transport (and, especially in Victoria, the railways
slashed freight rates and improved their services).^11 But the states had the
responsibility for the construction and maintenance of all but local roads.
Politically, it was hard for the states to resist demands for more and better
roads and bridges, in view of the increases in motor vehicle ownership;
moreover, the states received somefinancial assistance from the Common-
wealth, which for decades favoured‘main roads’connecting rural cities and
towns. The compromise was that the highways and roads were built, but
road transport, especially rural transport, was heavily regulated so as to
protect the states’main assets.
The result was, as the American diplomat, Pierrepont Moffat, wrote in 1936
to Secretary of State Cordell Hull,‘no-one may use a truck (even when he owns
one) to transport anything (even his own chattels) except to a railroad
station—any paralleling of the railroad is prohibited except on payment of a
prohibitive tax; one cannot hire a motor car for a pleasure trip into the interior
without paying a sizable tax to compensate the railroads for the loss of
revenue’(in Edwards 1979, p. 50): the details may be wrong, but the result—
protection of the railways—was what mattered.
In Victoria, Robert Menzies as Minister of Railways extended the restriction
on road competition from the urban areas to the rural (Motor Omnibus Acts of
(^11) The Railway Acts prevented commissioners from price discrimination, and especially from
increasing any fares or freight rates (Hunter 1965, pp. 94–5). Similar restrictions were common in
countries where railways were privately owned.
Socialism in Six Colonies: The Aftermath