Australia's increasing and almost zealous attachment to free-market policies over the last 40 years has left behind a trail of despair and destruction across regional and rural Victoria.

The land and towns that made Melbourne a great capital of the world with their gold and agricultural crops are struggling. Their people feel unappreciated and misunderstood, many eking a meagre existence but still proud and determined. They have been dealt one cruel blow after another as their independence, identity and sustainability decrease at the hands of government.

It doesn't matter the colour of government. The utopian policies of a level playing field for world trade, when our competitors often play by different rules, and the concentration of decision making in Melbourne have reduced country connectivity in Victoria.

A century ago, when Victoria's population was 1.4 million and for the first time since colonisation the majority were living in Melbourne, country towns still had economic clout despite the end of the golden era.

They were determined to survive on a mix of new industry using skills, resources and community pride to work through the closure of mines, the loss of young men heading off for King and Empire to war and the Great Depression that would later hinder those who returned from war.

The town-branded butter, flour and milk were as much a source of pride as the football club, brass band and church choir. The achievements of all were faithfully reported in the local newspaper. But the lot of country towns started to change in the 1970s - television had connected them like the rest of Australia to the outside world, life's pace had been upped by the Swinging Sixties and the certainty of the post-World War Two era had started to fray to the point of fragility.

Country towns were in line to take hits from government policies. Knitting mills were the first with restructure and ultimate removal of tariffs in the textile, clothing and footwear industries. Mills closed and with them annexes in small country towns that did piece work and provided employment for a workforce of mainly local women.

Government departments shut offices as the zeal of bureaucratic centralisation whipped across the old Forests Commission, Lands Department, State Rivers and Water Supply Commission, Soil Conservation Authority and the State Electricity Commission.

Trains were on the nose for travel, car ownership skyrocketing as people discovered greater mobility. Services were reduced, railway lines and stations closed. Soon butter factories, dairies and flour mills were added to the list of casualties, taken over by larger companies and most then closed. The country identity was diminishing. But the erosion of country Victoria's identity and importance was not to be restricted to a few changes in the 1970s.

Regional radio and television stations helped country towns retain and celebrate their identity until TV aggregation in the 1980s. What was sold to country people as giving them greater viewing choice, like that enjoyed by Melbourne, was to spell the end of opportunities for local shows showcasing entertainers and again, local jobs.

Agriculture and manufacturing, the mainstays of regional and rural economies have been the big losers in Australia's economic reform agenda over the last 40 years. And it is happening again today with massive upheavals in the car component industry and SPC in Shepparton.

Some reforms were needed, yet did governments consider the secondary effects of their decisions on rural and regional Victoria in the modern world? What would happen when the last orchards closed or dairy herd numbers plummeted, the factory no longer in business or government functions transferred to Melbourne? Who would be left to pick up the pieces? On that question anyway the answer would seem to be government at all levels who today prop up country towns.

Governments have effectively introduced and promulgated a form of socialism: country people are increasingly beholden to government for survival. They are trapped: some don't want to leave their home town, some just can't afford a shift to Melbourne, others forced to commute for employment and battle to keep some semblance of family life.

The disappearance of country spirit and identity on the back of industry and economic reforms have come at a high and ongoing price for government. Tourism, long touted as the economic saviour of the bush, has been no panacea.

Perhaps the way forward can be found in history - the return of more locally owned co-operatives and enterprises capitalising on local resources and skills, towns taking back responsibility for their future. The community banking model is one example of a modern community co-operative in action.

Global policies have slowed success in many rural areas but the heart of country Victoria can beat loudly once more.

Chris Earl is a former editor of the Ararat Advertiser and was a member of the Liberal Party's Victorian Division Administrative Committee for five years.

Free-Market Policies Rip At Heart Of Country Towns