Interstate Commerce Commission

Definition

The Interstate Commerce Commission (ICC) was a regulatory agency in the United States created in 1887 to oversee the railroad industry and its practices. It aimed to ensure fair rates, eliminate rate discrimination, and regulate other aspects of interstate transportation. The establishment of the ICC marked a significant government response to the growing power of large businesses, particularly railroads, highlighting the need for regulation in an era of increasing business concentration.

5 Must Know Facts For Your Next Test

1. The ICC was the first federal regulatory agency in the United States, setting a precedent for future regulation of various industries.
2. Initially focused on railroads, the ICC's jurisdiction expanded over time to include other modes of transportation, such as trucking and shipping.
3. The commission was empowered to investigate complaints, enforce regulations, and impose penalties for violations by interstate carriers.
4. Despite its establishment, the ICC faced challenges due to limited enforcement power and resistance from powerful railroad companies.
5. The ICC was ultimately abolished in 1995, with its functions transferred to the Surface Transportation Board, reflecting changes in regulatory philosophy over the years.

Review Questions

• How did the creation of the Interstate Commerce Commission reflect society's concerns about business concentration during its time?
  • The formation of the Interstate Commerce Commission illustrated society's growing apprehension about the power held by large corporations, particularly railroads. As these businesses expanded and began to dominate interstate commerce, issues like unfair pricing and discriminatory practices emerged, prompting calls for government intervention. The ICC aimed to restore fairness and competition in a market increasingly influenced by monopolistic practices, highlighting a critical shift toward regulatory oversight in response to corporate power.
• Evaluate the effectiveness of the Interstate Commerce Commission in regulating the railroad industry and addressing issues related to business concentration.
  • The Interstate Commerce Commission had mixed success in regulating the railroad industry. While it established important precedents for federal oversight and addressed some unfair practices, it often struggled with limited authority and resistance from powerful railroad interests. The ICC did manage to set fair rates and eliminate some discriminatory practices, but its overall effectiveness was hampered by insufficient enforcement mechanisms and challenges in adapting to rapidly changing market conditions. Over time, this led to calls for reform and a reevaluation of regulatory approaches.
• Assess the long-term impact of the Interstate Commerce Commission on future regulatory practices in the United States economy.
  • The Interstate Commerce Commission laid the groundwork for future regulatory agencies and practices in the United States economy. By establishing a framework for government intervention in private industries, particularly concerning monopolies and fair practices, the ICC set a crucial precedent that would influence subsequent legislation such as the Sherman Antitrust Act. Its legacy can be seen in contemporary regulatory bodies that oversee various sectors of the economy, reflecting an ongoing commitment to balancing corporate power with consumer protection and market fairness.

Related terms

Trust Busting: The government activities aimed at breaking up monopolies and trusts that stifle competition and harm consumers.

Sherman Antitrust Act: A landmark federal statute passed in 1890 that outlawed monopolistic business practices and was the first federal legislation to regulate trusts.

Regulatory Agency: A public authority or government agency responsible for overseeing and enforcing laws and regulations in specific sectors or industries.