Laws against AntiCompetitive Practices
Laissez-Faire
Interstate Commerce Act
Interstate Commerce Commission
Sherman Anti-Trust Act
Laissez-Faire
• Government did little at first to regulate big business
• Government believed in Laissez-Faire
• Even under Laissez-Faire system, government had a role
in the economy
• It provides laws to protect property and enforce contracts
Laissez-Faire
• It establishes a system of patents to promote
inventions
• Enacts tariffs to help manufacturers
• Many believed the economy worked best when it
was not Burdened by government regulations
Laissez-Faire
• Government leaders also doubted that the Constitution
gave them the right to regulate business
• Some anti-competitive practices of business were so
glaring that reformers called for legislation to remedy
them.
• This gave Government a much Greater Role
Interstate Commerce
Act
Notes on Next Slide
Year: 1887
• Railroads sometimes charge local farmers more to
haul their crops over short distances than they
charged for large companies to ship goods longer
distances on more competitive national routes.
• States passed laws prohibiting this practice, U.S.
Supreme Court held these laws to be
unconstitutional.
Year: 1887
• Court said only CONGRESS had to power to
regulate interstate commerce.
• In response, Congress passed the Interstate
Commerce Act
• Prohibited unfair practices by railroads
Interstate Commerce Commission
• Established to enforce the Interstate
Commerce Act.
• This was a landmark measure, since it was the 1st
time that Congress stepped into regulate business
in America.
Sherman Anti-Trust Act
Notes on Next Slide
Year: 1890
• The purpose of this federal law was to stop
monopolies engaging in unfair business
practices that prevented fair competition.
• The act marked a significant change in the
attitude of Congress toward the abuses of big
business.