The Interstate Commerce Act, significant for Advanced Placement United States History (APUSH) students, represents a landmark 1887 federal law designed to regulate the railroad industry. This legislation specifically targeted monopolistic practices and discriminatory rate-setting that burdened farmers and small businesses. It mandated that railroad rates be “reasonable and just,” prohibiting practices such as price gouging and pooling, where railroads conspired to fix prices in specific regions. This marked an early attempt by the federal government to assert regulatory control over private enterprise in the interest of public welfare.
The act’s importance stems from its establishment of the Interstate Commerce Commission (ICC), the first independent regulatory agency in the United States. While the ICC’s initial power was limited and its enforcement capabilities were weak, the agency’s creation set a crucial precedent. It signified a shift in the government’s role from a largely laissez-faire approach to one of active intervention in the economy to protect consumers and promote fair competition. The historical context includes growing public outrage over railroad abuses, fueled by organizations like the Grange and the Farmers’ Alliances, which advocated for government regulation.
