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In the Wabash, St. Louis & Pacific Railway Co. v Illinois (1886) case, the Supreme Court ruled that:
Railroad regulation by ANY government, either state or federal, was unconstitutional.
State governments could tax goods coming into a state from another state via railroad.
Railroads were so integral to the American economy that the federal government was justified in taking them over and running them, rather than having them privately owned and run.
While railroads inside a state were subject to regulation by that state, once a railroad crossed the border of another state, that regulation was no longer in effect.
Once given a contract by a state, railroads were given monopoly powers over that state's transportation business.