Hepburn Act facts for kids
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| Long title | An Act to amend an act entitled "An act to regulate commerce," approved February fourth, eighteen hundred and eighty-seven, and all Acts amendatory thereof, and to enlarge the powers of the Interstate Commerce Commission |
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| Enacted by | the 59th United States Congress |
| Effective | June 29, 1906 |
| Citations | |
| Public law | Pub.L. 59-337 |
| Statutes at Large | 34 Stat. 584 |
| Codification | |
| Acts amended | Interstate Commerce Act of 1887 |
| Legislative history | |
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The Hepburn Act was an important United States law passed in 1906. It gave the Interstate Commerce Commission (ICC) more power. The ICC was a government group that watched over businesses. This act allowed the ICC to set the highest prices that railroads could charge.
Before this law, railroads sometimes gave special free passes to their best customers. The Hepburn Act stopped this practice. It also let the ICC look at the railroads' money records. This was easier because the law made railroads use the same accounting system. If a railroad didn't follow the ICC's rules, those rules would stay in place. This would happen until a court decided otherwise. The ICC's power grew to include bridges, train stations, ferries, sleeping cars, and even oil pipelines.
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Why the Hepburn Act Was Needed
The Hepburn Act was named after William Peters Hepburn. He was a congressman from Iowa. This law was very close to what President Theodore Roosevelt wanted. It passed easily in Congress. Only three people voted against it.
This act was a big part of President Roosevelt's plan. He wanted to control railroads more. The Hepburn Act worked with another law, the Elkins Act of 1903. Both laws aimed to make railroads fairer for everyone.
Setting Fair Railroad Rates
The most important part of the Hepburn Act was about prices. It gave the ICC the power to change existing railroad rates. The ICC could replace them with "just and reasonable" maximum rates. The law also let the ICC decide what "just and reasonable" meant.
The ICC's decisions became legally binding. This meant railroads had to follow them. If a railroad disagreed, it had to challenge the ICC in federal court. To make this process faster, appeals from lower courts went straight to the U.S. Supreme Court.
Stopping Special Deals
The law also made rules against secret discounts stronger. Free passes were made illegal. The penalties for breaking these rules became much higher. The ICC's staff grew a lot after the act. In 1890, there were 104 staff members. By 1909, there were 527.
Finally, the ICC gained power to make all railroads use the same accounting system. They could also ask for standard reports. This allowed them to check the railroads' financial accounts.
Economic Impact
Some people believe that limiting railroad rates had an effect on their value. This might have been a factor in an economic downturn in 1907. This event is known as the Panic of 1907.
How the Hepburn Act Changed Things
Many experts see the Hepburn Act as a very important law. It greatly affected railroads in the early 1900s. Some historians and economists still discuss its long-term effects. They debate if it made railroads weaker. This might have given too much advantage to companies that shipped goods. Eventually, the trucking industry grew. This industry didn't exist in 1906. It later took away a lot of business from railroads.
Later Laws That Built on the Hepburn Act
In 1910, Congress passed the Mann–Elkins Act. This happened during President William Howard Taft's time in office. This new law helped fix some issues with how the Hepburn Act was put into action.
The Mann–Elkins Act gave the ICC more power. It allowed the ICC to start reviews of railroad price increases. Before, the ICC only reacted to complaints from shippers. The 1910 law also said the ICC could set "just and reasonable" maximum rates. It put the responsibility on the railroad to prove their prices were fair.
