Interstate Commerce Act

AFTER THE CIVIL WAR, the United States embarked on a massive railroad-building program. Although often subsidized generously by state and federal governments, railroad companies were private corporations, and regulation was nonexistent.

Each railroad had an initial natural monopoly but eventually they began to intrude onto each other's territory, creating fierce competition with associated special deals and costs that had to be made up in the areas without competition. Quickly, the railroads came to dominate the economic life of the communities they joined, especially those small agricultural towns in farm country previously accessible only by dirt road.

By the 1870s, farmers and others began to object to the excessive economic power of the railroads. Charges abounded of monopolistic practices, influence peddling in the political arena, stock manipulation, rate ...