<P> The Act was the first federal law to regulate private industry in the United States . It was later amended to regulate other modes of transportation and commerce . </P> <P> The act was passed in response to rising public concern with the growing power and wealth of corporations, particularly railroads, during the late nineteenth century . Railroads had become the principal form of transportation for both people and goods, and the prices they charged and the practices they adopted greatly influenced individuals and businesses . In some cases, the railroads were perceived to have abused their power as a result of too little competition . Railroads also banded together to form pools and trusts that fixed rates at higher levels than they could otherwise command . Railroads often charged a higher price per mile for short hauls than for long hauls . The practice was decried as one that discriminated against smaller businesses . </P> <P> Responding to a widespread public outcry, states passed numerous pieces of legislation . Through the 1870s various constituencies, notably the Grange movement representing farmers, lobbied Congress to regulate railroads . While the Senate would investigate and report its findings and recommendations in 1874, Congress declined to step in, mirroring the lack of consensus in approach . In the 1886 decision on Wabash, St. Louis & Pacific Railway Company v. Illinois however, the U.S. Supreme Court ruled that state laws regulating interstate railroads were unconstitutional because they violated the Commerce Clause of the Constitution, which gives Congress the exclusive power "to regulate Commerce with foreign nations, and among the several States, and with the Indian Tribes ." With many of those questions of approach decided, Congress passed the Interstate Commerce Act the following year; it was signed into law by President Grover Cleveland on February 4, 1887 . </P> <P> The act worked to keep rates and railroad revenue up on routes where competition existed . It did this by attempting to force publicity about rates and make rebates and discrimination illegal . (' Discrimination' meant lower rates for certain customers, e.g. politicians, large customers, sharp bargainers, long haul shippers, shippers in competitive markets, low season travelers .) Railroads saw that competition made it hard to pay their stockholders and bondholders the amount of money promised to them, and competition was therefore "bad ." </P>

The federal government created the interstate commerce commission (icc) as a response to which event