What happens when you have real data on transport

Back on April 5th I noted that the suburban rail network we have in Melbourne today was substantially in place by the end of the nineteenth century.

I asked why, with the threat of climate change and peak oil hanging over us, we can’t replicate the achievements of the nineteenth century and massively expand Melbourne’s rail network. If our forebears of four or five generations ago could do it, why can’t we, with our superior technology, do even better?

I pointed out – quite accurately as it turned out – that I couldn’t bring an historian’s eye to the subject. I proposed six hypotheses to explain why it would be much harder to build the suburban network today. One of my reasons was that back then the railways covered their operating costs. A reader, Russ, pointed out that the experience in Victoria was quite different:

After the 1880s the government stepped in, and via the combination of rampant corruption and misplaced optimism in the largest real estate bubble in Australian history built 90% of the existing network – most of it completely wasted expenditure.

On his recommendation, I’ve been flipping through The Land Boomers by Michael Cannon. According to Cannon, transport was so vital to Melbourne’s growth that the story of Victorian politics in the 1880s was largely the story of the building of railways:

Hundreds of miles of track, some of it quite useless, pushed out from the egocentric city to the rampant suburbs and the far countryside. Hardly a member of Parliament whose vote could be bought went without his bribe in the form of a new railway, a spur line, or advance information on governmental plans to enable him to buy choice land in advance – the value of which was enormously enhanced when the line went through. It was a dispiriting chapter in Victorian political morality.

Successive governments were infected with rail building mania. By 1884, the so-called ‘Octopus Act’ authorised the construction of 65 lines totalling 1,170 miles at an estimated cost of £44 million. It authorised two major extensions of the suburban system, one of which was a “ludicrous enterprise known as the Outer Circle Railway” (the other was the presumably more sensible connection of Flinders Street and Spencer Street stations). The Outer Circle, much of which is used today for bicycle trails, only lasted three years. It went from North Melbourne, via Brunswick and North Fitzroy to Fairfield and then on via East Kew to join the Gippsland line at Oakleigh:

The land boomers inside and outside Parliament saw it as a speculators’ paradise and invested heavily in broad acres along the route. They were caught with their signals down. No sane passenger would use the line when it took him 4 hours 20 minutes to travel from Oakleigh to the city by this route. Nor was there much intermediate traffic. For decades later, the rusting nails and abandoned stations of the Outer Circle route remained as a silent reminder of the boom years.

Cannon says the final cost of the great railway building spree crippled State budgets for decades. “Even today”, he says – meaning circa 1966 when the book was published – “the incubus of the railway boom of the 1880s lies heavily on the taxpayer”.

There are only seven pages on rail, with illustrations, in this book (out of more than 300 pages) so this is not a definitive account of the shenanigans that must’ve gone on. There’s only one small book in the bibliography on rail (by R L Wettenhall) so perhaps this is a subject that hasn’t been examined exhaustively, or at least not by the time Cannon was writing.

I expect there were some rail lines that did in fact cover their operating costs (capital costs would’ve been another matter — Cannon gives an example of how costs were corruptly inflated). After all, there was little alternative to rail for suburban and up-country travel at the time. In some cases this might not have been until sometime after the lines were constructed. But there must have been many that didn’t even come close, particularly in the country.

But what Cannon’s account highlights is a seventh reason (hypothesis) why it would be much harder to replicate the suburban rail system today. It was built during a spectacular period in the city’s history, with a coincidence of highly speculative investment mania and political corruption. While there will be particular exceptions, I can’t see that rail is linked so intimately anymore to increases in the value of new land on the scale it was in the 1880s. Modern manias are more likely to occur in other fields e.g. the dot com boom ten years ago. And Melbourne was surely a more corrupt place then. For all our faults, we have better defences against official corruption – better laws, better media and stronger societal norms against political and bureaucratic corruption.

That doesn’t mean we’re exempt from occasional decisions about particular new rail lines that are politically motivated, or even some that appear to benefit certain parties. It’s just the scale isn’t there anymore.

Update: This New York Times op ed has some interesting historical (and contemporary) lessons.