feb 4, 1887 - Interstate Commerce Act of 1887
Description:
A federal act that established the Interstate Commerce Commission (ICC), the first independent regulatory agency. It was designed to regulate railroads to ensure their rates were "reasonable and just."
The act was passed because there was very little regulation on railroad companies, allowing them to overcharge small farmers while giving discounts for political allies and big businesses. The Grange movement was formed in order to protect farmers from the abuses of these railroad companies. Grangers lobbied Congress for change, but it was the Supreme Court that saved them in the 1886 decision Wabash, St. Louis & Pacific Railway Company v. Illinois, in which the Court ruled that interstate railroads violated the Commerce Clause of the Constitution. As a result of this decision, the Interstate Commerce Commission was born.
However, the ICC was rather limited in its abilities. It had the authority to investigate and bring to court railroad companies for unjust practices, but only when the company operated across states. Additionally, the Supreme Court frequently ruled in favor of the corporations when they were brought to trial. The ICC would gain more power through the Hepburn Amendment in 1906, which allowed the ICC to set maximum rates and extended its jurisdiction to beyond railroads, but overall it would continue to have limited effects on business practices. The ICC was abolished in 1995.
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