Government and Commerce

The Constitution Basis

The constitution grants congress two powers. The powers "to lay and collect taxes," for general welfare, and the power to "regulate commerce." These powers are vested in congress by the commerce clause in article 1, section 8. The founders of the constitution made this clause to allow the government to regulate interstate commerce which is production and transportation of goods, communications, mining, and the sale of stocks and bonds. Regulating includes prohibiting, promoting, protecting, assisting, and establishing standards for many aspects of interstate commerce. There are more than 100 federal agencies and commissions that regulate American businesses.

Antitrust Legislation

· Trusts were really popular in the late 1800s and having trust created monopolies. Congress tried to stop monopolies by passing the Sherman and Clayton Antitrust Act in 1890. These were the first two sections of the Antitrust;

Section 1: "Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal."

Section 2: "Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States."

Violating section two of the trust a felony today. The Federal Trade Commission (FTC) was responsible for carrying out the provision of the act. They could define unfair competitive practices, issue orders to halt these practices, examine corporate purchase of stock, and investigate trade practices. The FTC had many duties and responsibilities such as enforcing laws that prohibit false advertising and requiring truthful labels on textiles and fur. They also regulate packaging and labeling of certain consumer goods, require full disclosure of the lending practices of finance companies and retailers who use installment plans, and checks consumer credit agencies. Today instead of trust and monopolies the economic power belongs to oligopolies, which is the control of an industry by a few group of firms.