After the end of the Reconstruction of the South, the people of the United States of America were looking for a change. Between the years of 1865 and 1900 big businesses and monopolies had become overwhelmingly powerful. Especially in the field of railroads, the Robber Barons were almost unstoppable in their quest for more money. That was when it became necessary for the government to step in. The government passed the Interstate Commerce Act and the Sherman Anti-Trust Act, as an attempt to control the powerful conglomerates. Of course those actions went against laissez faire and the government became actively involved in commerce. The government's control of interstate commerce, railroad grants, and anti-trust activities were necessary for the good of the people, even though they violated the policy of laissez faire.
Laissez faire basically means "hands off" and it refers to the government's involvement in the economy. This concept was first introduced by Adam Smith. Involvement in the economy by the government was not mentioned in the Constitution and as Daniel Knowlton once said the government must leave the "individual enterprise untrammeled". Amasa Walker once said "the government is best which governs least". She also claimed that the law of supply and demand is the governing factor in the economy.
By the late 1800's the need for transcontinental railroads had become obvious. The only problem was that no one in the country could afford to build one. This is where the U.S. government made its first violation of laissez faire. The government decided to grant millions of acres of land to railroad companies. As shown in Document D over 130 million acres of land were granted. The railroads abused their privilege and in an attempt to cheat the government out of more money they created the Credit Mobilier company, which demanded money from the government to build the railroads that was not required.
