According to documents released under the Freedom of Information Act, rail regulator Tom Winsor tried to prevent inept UK rail infrastructure company Railtrack from going bust shortly before its unlamented demise in 2001. Mr Winsor agreed with the company’s plan for the government to give it money on demand for four years, in exchange for an equity stake.
Transport minister Stephen Byers was less than keen on this idea. He pointed out, reasonably, that renationalisation, restructuring or receivership were the only options on the cards: granting massive subsidies to private sector companies that have utterly screwed up isn’t a sensible industrial policy. Mr Winsor was overruled, and Railtrack died.
As one might expect, the ‘economists’ at the Adam Smith Institute get entirely the wrong end of the stick. "You might have come to the conclusion that the privatization of Britain’s rail network was a bad idea that was doomed to fail. You’d be wrong. The fate of the privatized infrastructure company Railtrack was murder, not natural causes.".
Silly sods. Railtrack died because the government refused to bale it out with massive subsidies following its massive, epic incompetence. If you’re a free-market think-tank, what the hell are you doing suggesting the government should give massive subsidies to failing companies?