Rothbard explains the origins of the ICC in the first 10-12 minutes of the video
https://www.youtube.com/watch?v=tGX3_XnC8n0
The purpose of the ICC was to stop competition and to preserve monopolies. Secret price cutting was banned in order to preserve cartel agreements.
More Articles about the ICC
https://mises.org/freemarket_detail.aspx?control=13
Before the ICC the railroad industry was largely competitive thanks to it the industry become monopolized.
Well I guess this qualifies as an alternative explanation of the ICC, which certainly had its faults and certainly did its damage to the national rail system. But it is also worth reading about some of the prevailing business practices of the time – not just in railroading but in all manner of industries and businesses – to see why the ICC was formed and endorsed, and not just by wild eyed populists pandering to small and inefficient shippers, either.
Dave Nelson
There’s a whole lot more to the ICC than the old Hiltonian/Beardian interpretation. Not that there wasn’t a healthy dollop of self-serving for railroad owners through the Commerce Court days. But look what happened during TR’s administration, with the Elkins and Hepburn Acts, and the forced separation of mining and other interests from railroad operations, or later, when Progressive interests got hold of ithe reins of power at the ICC, culminating first in Federal control and then the Esch Act ‘pounds of flesh’.
Meanwhile, a bit better understanding of unrestrained competition in the railroad industry – and who ‘benefited’ from it – would be in order. You may fault Morgan for being self-serving in the affair of the West Shore/South Penn, but it was going to leave both parties in severe financial trouble if ‘left to their own devices’. Consider how people like the Vanderbilts and van Sweringens (ignore how they were bankrolled) acquired the companies they did, at the times and under the conditions they did.
I don’t know if the ban on rebates or other forms of ‘secret price cutting’ were done to foster or support some sort of cartel arrangement – I would much rather think it involved mutual agreement to find a nonruinous level of activity. A cartel by definition controls access and production as well as limiting competition and providing severe barriers to entry. There are aspects of this in ICC-regulated anticompetitive behavior, but they do not match the typical sort of ‘cartel’ economic drivers. My opinion is that as soon as the folks who ran the Government stopped being the folks who ran the railroads and other industries, the ICC started becoming the adversarial organization it clearly was by the time of WWI.
Look at the ‘extra fare’ negotiations conducted at a slightly later time, which supported inherently ‘slower’ or poorer railroads by requiring a surcharge based on train p
I think the real issue is not so much the origins of the ICC but what the ICC ultimately became as it acquired more and more power. Originally, in 1887, it had very little power. But beginning in 1906 it began to acquire more and more power.