Why did the policies of the federal government from 1865 to 1900 sometimes violate the principles of laissez-faire?

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pohnpei397 | College Teacher | (Level 3) Distinguished Educator

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When the US government broke with the ideas of laissez-faire during this time, it was generally because various politically powerful constituencies wanted the government to do so.  At times, the powerful constituencies were pro-business while at other times they were opposed to the interests of the big businesses.

Under the doctrine of laissez-faire, the government is not supposed to intervene either to help or to hinder business.  Thus, pro-business intervention by the government is not part of laissez-faire.  However, the government did intervene on the side of business at times.  One thing the government did was to subsidize the building of the transcontinental railroad.  Another thing it did was to use the power of the government to intervene on the side of business in numerous strikes.  In both cases, a major reason for intervention was the fact that big businesses tend to be politically powerful and governments typically want to please them when possible.

However, there were times when the government was pulled in the other direction by large numbers of people demanding regulation of business.  Two examples of this can be seen in the regulation of railroads and the creation of antitrust laws.  In these cases, there were large numbers of people (the populists and the progressives, respectively) who strongly demanded government intervention.  The government cannot typically defy the desires of large numbers of people and therefore the government did violate the ideas of laissez-faire to regulate businesses.

In general, then, the government moved away from laissez-faire at times because powerful constituencies demanded it. 

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