The law creating the Commission, passed by Congress in 1887, and based on the above clause, was the result of a demand voiced by the farmers of the Middle West, between whom and the railroad companies considerable friction over freight rates had developed. In some cases extortionate freight rates were charged, making the growers of produce for distant markets economically dependent on the railroads.
With regard to railroads, sleeping car companies and express companies, no free transportation was permitted, with certain exceptions. Railroad companies were forbidden to transport free of charge commodities belonging to themselves, excepting timber and equipment. Railroad companies must lay switches to accommodate any and all parties desiring to ship freight. There must be no discrimination in favor of or against any private firm or corporation, desiring to ship goods. There must be no special charges for short hauls. There must be no pooling of freight and division of earnings. Rate and fare schedules must be published and posted in certain places visible to the public. Contracts between railroad companies and between companies and private firms must be filed before the Interstate Commerce Commission, and be formally approved by it.
To enforce these provisions, the Interstate Commerce Commission was created, whose eleven members are appointed for terms of six years, subject to the approval of the Senate. No more than three members of the Commission may be partisans of the same political party.
The Commission is empowered to inquire into the business of all carriers; railroad, steamship and express companies. It may compel testimony and requisition papers and documents, and it has the right to investigate on all complaints that are made before it. It must publish full reports on all such investigations. The power most widely associated with the Commission, however, is that of fixing transportation rates, for both freight and passenger traffic. Its decisions regarding rates are final, and remain valid for two years. The Commission may also award damages where private persons or firms can prove injury received through any of the carrier companies coming under its jurisdiction. It may examine the books and accounts of such companies. It may require from them annual, or even monthly, reports of their finances and business transactions. Summed up, the Commission is, in fact, a court of adjustment in transportation matters, with all the powers of a court. Its headquarters are in Washington, D. C., but its sittings may be in any part of the country.
Transportation Act, 1920.—The Transportation Act, 1920, provides for the termination of Federal control and limits the powers the President may thereafter exercise under the Federal-control act to those necessary to wind up and settle matters arising out of Federal control; for the turning over to the Secretary of War for operation and settling up of all matters arising out of Federal control in connection with boats, barges, tugs, and other facilities on the inland, canal, and coastwise waterways acquired by the United States under the Federal-control act, and requiring him to provide terminal facilities for the interchange of traffic with carriers, and renders the operation of the boats and facilities subject to the provision of the interstate-commerce act to the same extent they would be if not owned by the United States. This act also authorizes the President to advance moneys to the carriers for certain purposes out of the revolving fund created by the Federal-control act, and requires the commission to ascertain and certify to the Secretary of the Treasury the amounts to be thus advanced to the carriers. It also provides for the appointment by the President of an agent to act as defendant in actions at law, suits in equity, proceedings in admiralty, and before the commission, based on matters arising out of Federal control, and confers upon the commission jurisdiction over all claims for reparation pertaining to the Federal-control period, whether arising in respect of intrastate or interstate traffic; that, pending actions, suits, proceedings, and reparation claims shall not abate, but that reparation awards in such cases shall be paid out of the revolving fund; that the period of Federal control shall not be computed as a part of the periods of limitation in actions against carriers or in claims for reparation based on causes of action arising out of matters pertaining to Federal control; and that a judgment in favor of the United States is the only one that may be levied against the property of the carrier where the judgment is based upon such matters.
The Transportation Act also continues in force until changed by lawful authority all rates, fares, charges, classifications, regulations, and practices in effect on Feb. 29, 1920, and prohibits reductions of such rates, fares, and charges prior to Sept. 1, 1920, except with the approval of the commission. It provides certain guaranties of compensation for a period of six months from March 1, 1920, to all carriers which were entitled to the same
