Why regulation grew
Farmers, shippers and communities often complained about rates, discriminatory pricing and railroad market power. These disputes helped create pressure for state and federal oversight.
Interstate Commerce Commission
The Interstate Commerce Act of 1887 created the Interstate Commerce Commission, an important milestone in federal economic regulation.
Changing competition
Automobiles, trucks, pipelines and airlines steadily captured traffic that once had few alternatives to rail. Railroads also faced high fixed infrastructure costs and extensive regulatory constraints.
Consolidation and crisis
By the mid-twentieth century, many railroads struggled financially. Mergers reduced the number of major carriers, while the collapse of several northeastern railroads demonstrated the severity of the industry's problems.
Staggers Act era
The Staggers Rail Act of 1980 substantially reduced federal economic regulation of freight railroads, giving carriers greater flexibility over rates and service. The industry subsequently reshaped routes, operations and pricing.
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