Paul Marks takes a radical view of Britain’s transport system
No one has yet explained to me why the railways could not have been sold as a single unit.
If it had been more efficient to brake up British Rail into regional companies then the new owners would have done just that. Just as if it had been more efficient for the rail to be owned by one company, and have the trains run by other companies this is what would have evolved via the choices of people buying and selling shares (“market forces” are, of course, simply the choices of people engaged in trading). There was certainly no need for the government to engage in complicated schemes – just sell the thing and stand back.
People often talk for the need for subsidies for the railways to compete with the roads (and, to a lesser extent, the airlines) – but whilst I am pleased to accept the fact that the railways and roads do compete for custom (which rather undermines the idea that the railways must be compulsorily broken up to ensure “competition”) I think the whole idea that the railways must fall apart without subsidies is false.
Firstly the roads should not be provided “free” (i.e. free at the point of use) by the state. The problem is not that the government builds motorways late – the problem is that it builds them at all. If people want motorways let them build them and charge people to use them (such things as “road tax” should, of course, be abolished). If people really want to build free motorways let them do so – but I doubt charitable people will put up enough money for this idea.
As for the railways – subsidies should be abolished, but so should regulations. The railways have been attacked by regulations as far back as the 19th century (there were such things as profit controls even then), but in 1906 the government basically declared war on the private railways. Putting trade unions above the law of contract (i.e. outside civil interaction) hit British industry badly – but the railways companies were a specific target of the 1906 Act (the Act was, after all, a direct reaction to the “Taff Vale Judgement” in which the courts declared that a railways company had the right to sue a trade union for organised contract breaking). The “Liberal” government of the day also launched a tidal wave of regulations at the railway companies in the period 1906 to 1914. And then (during the First World War) the railways were taken over by the government, maintenance neglected and the system undermined. We should be very wary of making claims such as the idea that the British railway system was the best in the world in 1919 – such claims are not only rather easy for statists to refute, but (more importantly) undermine the libertarian case that regulations and state control have undermined the railways.
Why the history lesson? Simple – after the returning of the railways to a sort of private ownership history repeated itself. First history repeated itself as farce – in that the government of Mr Major did not intend to harm private railway companies with regulations (but did anyway). And then history repeated itself in a straightforward way with the Labour government’s transport boss (Mr Prescott) setting out to undermine the railway companies as much as he could. A policy continued by his supposedly arch “New Labour” successor as transport boss.
Without the regulations the railways might well be able to compete quite well with the roads without any subsidies at all – even if the roads remained free.
And (of course) a railway system without regulations would be a much safer railway system – as it would be clear who was in charge and who was responsible.
Paul Marks
