=The Grangers and State Regulation.=—The same uncertainty about the railways and trusts pervaded the ranks of the Republicans and Democrats. As to the railways, the first firm and consistent demand for their regulation came from the West. There the farmers, in the early seventies, having got control in state legislatures, particularly in Iowa, Wisconsin, and Illinois, enacted drastic laws prescribing the maximum charges which companies could make for carrying freight and passengers. The application of these measures, however, was limited because the state could not fix the rates for transporting goods and passengers beyond its own borders. The power of regulating interstate commerce, under the Constitution, belonged to Congress.
=The Interstate Commerce Act of 1887.=—Within a few years, the movement which had been so effective in western legislatures appeared at Washington in the form of demands for the federal regulation of interstate rates. In 1887, the pressure became so strong that Congress created the interstate commerce commission and forbade many abuses on the part of railways; such as discriminating in charges between one shipper and another and granting secret rebates to favored persons. This law was a significant beginning; but it left the main question of rate-fixing untouched, much to the discontent of farmers and shippers.
=The Sherman Anti-Trust Law of 1890.=—As in the case of the railways, attacks upon the trusts were first made in state legislatures, where it became the fashion to provide severe penalties for those who formed monopolies and “conspired to enhance prices.” Republicans and Democrats united in the promotion of measures of this kind. As in the case of the railways also, the movement to curb the trusts soon had spokesmen at Washington. Though Blaine had declared that “trusts were largely a private affair with which neither the President nor any private citizen had any particular right to interfere,” it was a Republican Congress that enacted in 1890 the first measure—the Sherman Anti-Trust Law—directed against great combinations in business. This act declared illegal “every contract, combination in the form of trust or otherwise, or conspiracy in restraint of trade and commerce among the several states or with foreign nations.”
=The Futility of the Anti-Trust Law.=—Whether the Sherman law was directed against all combinations or merely those which placed an “unreasonable restraint” on trade and competition was not apparent. Senator Platt of Connecticut, a careful statesman of the old school, averred: “The questions of whether the bill would be operative, of how it would operate, or whether it was within the power of Congress to enact it, have been whistled down the wind in this Senate as idle talk and the whole effort has been to get some bill headed: ’A bill to punish trusts,’ with which to go to the country.” Whatever its purpose, its effect upon existing trusts and upon the formation of new combinations was negligible. It was practically unenforced by President Harrison and President Cleveland, in spite of the constant demand for harsh action against “monopolies.” It was patent that neither the Republicans nor the Democrats were prepared for a war on the trusts to the bitter end.