Abolishing a Federal Agency: The Interstate Commerce Commission

"Congress has, from time to time, enacted legislation to discontinue a federal agency and either redistribute or discontinue its functions. Abolishment of an agency or its functions has often been politically challenging because of the potential impact on stakeholders with competing interests. Frequently, it has also been administratively complex, involving myriad decisions about policies and the distribution of functions and resources during the winding down of the abolished agency.

This report takes a closer look at the abolishment of one particular agency—the Interstate Commerce Commission (ICC)— and most of its functions. It reviews, in historical context, the ICC’s establishment, growth, decline, and elimination.

During the mid-1800s, railroads became key for rural growers, mining companies, and others to transport goods to urban centers. The nature of rail transportation and national and state government policies led to powerful railroad companies that were monopolistic in some geographic areas and ruinously hypercompetitive in others. Responding to public opinion and stakeholder advocacy, Congress established the ICC to defend the public from these practices, primarily through adjudication of grievances.

Although some considered the newly established ICC to be relatively weak and ineffective, Congress greatly expanded the ICC’s authority and responsibilities during the first part of the 20th century. World War I led the federal government to take control of the railroads. Following the war, the railroads were returned to private control. Rather than returning to its pre-war role as a regulator of privately owned and operated railroads, however, the ICC was charged with broader responsibilities in managing the industry in the context of U.S. commerce. The railroad industry was weakened by the Great Depression and increasing competition from other transportation modes—particularly trucking. These challenges led Congress to further adjust the ICC’s role from protecting those  served by powerful railroad companies to managing the economics of the transportation sector in the public interest..."
Abolish a Federal Agency