Wabash Case

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Wabash, St. Louis & Pacific Railway Co. v. Illinois, 118 U.S. 557 (1886), argued 14–15 Apr. 1886, decided 25 Oct. 1886 by vote of 6 to 3; Miller for the Court, Bradley, Waite, and Gray in dissent. In Wabash, the Supreme Court held that the states have no power to regulate railroad rates for interstate shipments. Substantially modifying the standard employed since Cooley v. Board of Wardens of the Port of Philadelphia (1852), the Court said the Commerce Clause allows the states to enact “indirect” but not “direct” burdens on interstate commerce. State rate regulations were “direct” burdens on commerce and therefore could not govern interstate transportation.

Wabash did not deny the states all power over interstate railroading. The Court, for example, upheld state safety regulations as permissible “indirect” burdens. Yet Wabash created an important regulatory void by making rate regulation of interstate shipments an exclusive federal power. Prior to Wabash, the federal government had left the subject of railroad regulation almost entirely to the states. In response to the decision, Congress established the Interstate Commerce Commission (1887). Thus, Wabash precipitated the advent of the modern independent regulatory agency and initiated the shift of governmental responsibility for economic affairs from the states to the national government. Wabash remains a landmark even though the “direct” versus “indirect” test it propounded to define the domain of exclusive federal power over interstate commerce was abandoned in the 1930s in favor of a functional balancing approach.

See also Administrative State; Commerce Power; Federalism.

Stephen A. Siegel

Wabash Case popular name for Wabash, St. Louis & Pacific Railroad Company v. Illinois, decided by the U.S. Supreme Court in 1886. The decision narrowed earlier ones (see Munn v. Illinois ) favorable to state regulation of those phases of interstate commerce upon which Congress itself had not acted. The court declared invalid an Illinois law prohibiting long- and short-haul clauses in transportation contracts as an infringement on the exclusive powers of Congress granted by the commerce clause of the Constitution. The result of the case was denial of state power to regulate interstate rates for railroads, and the decision led to creation of the Interstate Commerce Commission .