The history of the Commission as an effective instrument of government dates from the Hepburn Act of 1906[379] which was followed four years later by the Mann-Elkins Act.[380] By the former the Commission was explicitly endowed with the power, after a full hearing on a complaint made to it, "to determine and prescribe just and reasonable" maximum rates. By the latter it was further authorized to set such rates on its own initiative, and without waiting for a complaint; while any increase of rates by a carrier was made subject to suspension by the Commission until its approval could be obtained. At the same time, the Commission's jurisdiction was extended to telegraphs, telephones and cables.[381]

THE INTERSTATE COMMERCE COMMISSION TODAY

The powers of the Commission, which has been gradually increased to a body of eleven, are today largely defined in the Transportation Act of February 28, 1920. By that act they were extended not only to all "railroads," comprehensively defined, but also to the following additional categories of "'common carriers' * * * all pipeline companies; telegraph, telephone, and cable companies operating by wire or wireless [See [note 3 above]]; express companies; sleeping-car companies; and all persons, natural or artificial, engaged in such transportation or transmission as aforesaid as common carriers for hire." The jurisdiction of the Commission covers not only the characteristic activities of such carriers in commerce among the States, but also the issuance of securities by them, and all consolidations of existing companies, or lines. Furthermore, for the first time, the Commission was put under the injunction, in exercising its control over rates and charges, to "give due consideration, among other things, to the transportation needs of the country and the necessity (under honest, efficient and economical management of existing transportation facilities) of enlarging such facilities in order to provide the people of the United States with adequate transportation."[382] Railway rate control itself, which was originally entered upon by the National Government exclusively from the point of view of restraint, has thus been assimilated to the idea of "fostering and promoting" transportation.

Two types of constitutional questions have presented themselves under the legislation just passed in review: 1. Those arising out of the safeguards which the Bill of Rights throws about property rights; 2. Those arising out of the intermingling of the interstate and intrastate operations of the same carriers, and the resulting tangency of State with national power. Only the latter are considered at this point.

THE SHREVEPORT CASE

Section 1 of the act of 1887 contains the proviso "that the provisions of this act shall not apply to 'transportation' wholly within the State." Section 3 of the act prohibits "any common carrier subject to the provisions" of the act from giving "any unreasonable preference or advantage" to any person, firm, or locality. In the Shreveport Case,[383] decided in 1914, the Commission, reading § 3 independently of § 1, had ordered several Texas lines to increase certain of their rates between points in Texas till they should approximate rates already approved by the Commission to adjoining points in Louisiana. The latter rates, being interstate, were admittedly subject to the Commission. The local rates were as clearly within the normal jurisdiction of the State, and had in fact been set by the Texas Railway Commission. The Court found that the Interstate Commerce Commission had not exceeded its statutory powers. The constitutional objection to the Commission's action was stated thus: "That Congress is impotent to control the intrastate charges of an interstate carrier even to the extent necessary to prevent injurious discrimination against interstate traffic." This objection the Court met, as follows: "Wherever the interstate and intrastate transactions of carriers are so related that the government of the one involves the control of the other, it is Congress, and not the State, that is entitled to prescribe the final and dominant rule, for otherwise Congress would be denied the exercise of its constitutional authority and the State, and not the Nation, would be supreme in the national field."[384] This, the Court continued, "is not to say that Congress possesses the authority to regulate the internal commerce of a State as such, but that it does possess the power to foster and protect interstate commerce, and to take all measures necessary or appropriate to that end, although intrastate transactions of interstate carriers may thereby be controlled."[385]

THE ACT OF 1920 AND STATE RAILWAY RATE REGULATION

The power of the Commission under § 3 of the act of 1887, as interpreted in the Shreveport Case, was greatly enlarged by § 416 of the act of 1920, which authorizes the Commission to remove "any undue, unreasonable, or unjust discrimination against interstate or foreign commerce." Thus, commerce as a whole, instead of specific firms or localities, is made the beneficiary of the restriction. In the Wisconsin R.R. Comm. v. Chicago, B. & Q.R.R. Co.,[386] the Court held that this section sustained the Interstate Commerce Commission in annulling intrastate passenger rates which it found to be unduly low, in comparison with rates which the Commission had established for interstate travel, and so tending to thwart, in deference to a merely local interest, the general purpose of the act to maintain an efficient transport service for the benefit of the country at large.[387]

REGULATION OF OTHER AGENTS OF CARRIAGE AND COMMUNICATION

In the Pipe Line Cases, decided in 1914,[388] the Court affirmed the power of Congress to regulate the transportation of oil and gas in pipe lines from one State to another and held that this power applies to such transportation even though the oil (or gas) in question was the property of the owner of the lines.[389] Thirteen years later, in 1927, the Court ruled that an order by a State commission fixing rates on electric current generated within the State and sold to a distributor in another State was invalid as imposing a burden on interstate commerce, thus holding impliedly that Congress' power to regulate the transmission of electric current from one State to another carried with it the power to regulate the price of such electricity.[390] Proceeding on this implication Congress, in the Federal Power Act of 1935,[391] conferred upon the Federal Power Commission the power to govern the wholesale distribution of electricity in interstate commerce; and three years later vested in the same body like power over natural gas moving in interstate commerce.[392] In Federal Power Commission v. Natural Gas Pipeline Company,[393] the power of the Commission to set the prices at which gas, originating in one State and transported into another, should be sold to distributors wholesale in the latter State, was sustained by the Court in the following terms: "The argument that the provisions of the statute applied in this case are unconstitutional on their face is without merit. The sale of natural gas originating in the State and its transportation and delivery to distributors in any other State constitutes interstate commerce, which is subject to regulation by Congress. * * * It is no objection to the exercise of the power of Congress that it is attended by the same incidents which attend the exercise of the police power of a State. The authority of Congress to regulate the prices of commodities in interstate commerce is at least as great under the Fifth Amendment as is that of the States under the Fourteenth to regulate the prices of commodities in intrastate commerce."[394]