Violations of Laissez Faire by the U.S federal government between 1865 and 1900

Essay by Audie LashgariCollege, UndergraduateA, January 1997

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The principle of laissez faire is that the an unobtrusive government is the best government; that the government necessarily only 'maintain domestic tranquillity, defend the people from invasion, and protect them when travelling.' To leave economic workings of the country to the people and let the 'motives for production' be that of the people not the government. Our government took such a stance in its early decades, but as national debt rose, interstate commerce became indomitable, and the economy lost its strength, the need to patch the economy became very important. The government found that the needed patch was much more important than the laissez faire freedom previously given to monopolistic trusts, who were loosing favor with the majority of the lower class, who shared on 50% of the nation's wealth. As an attempt to end all that ailed the country the government began limiting land grants, instituting interstate commerce laws, and passing anti-trust bills, like The Sherman Anti-Trust Bill.

As the railroads became larger and more powerful, the need to give away land to million dollar companies became ludicrous to many citizens, especially in light of the declining economy. These changing feelings among the people (voters) moved congress to decide that 'no subsidy in money, bonds, public lands, indorsement, or by pledges of public credit' should be given to the railroad or any other private company, when it could be spent on the common good of the public, or kept as capital in the Public Treasury. The idea that no land need be given to the companies anymore was also supported by the growing feeling of being cheated by the railway through rebates, and other discriminations between large and small business.

The decision to regulate interstate commerce grew mostly out of the rebate, and long-haul, short-haul discriminations of the...