A President Under Fire Many supporters of Grover Cleveland sought patronage jobs after his election to office. Many strikes occurred during Cleveland’s administration. Police and guards sometimes attacked the strikers. A bomb exploded at a labor demonstration in Haymarket Square in Chicago. Small businesses and farmers became angry at railroads because they paid high rates for shipping goods, but large corporations were given rebates, or partial refunds, and lower rates for shipping goods.

Problems Both Democrats and Republicans believed that government should not interfere with corporations’ property rights. In 1886 the Supreme Court ruled in the case of Wabash v. Illinois that the state of Illinois could not restrict the rates that the Wabash Railroad charged for traffic between states because only the federal government could regulate interstate commerce. In 1887 a bill was signed creating the Interstate Commerce Commission. This was the first law to regulate interstate commerce.

Problems Many Americans wanted to do away with high tariffs because they felt that large American companies could compete internationally. They wanted Congress to cut tariffs because these taxes caused an increase in the price of manufactured goods. President Cleveland proposed lowering tariffs, but Congress was deadlocked over the issue. Tariff reduction became a major issue in the election of 1888.

Republicans Regain Power The Republican candidate in the 1888 election was Benjamin Harrison His campaign was given large contributions by industrialists who wanted tariff protection. The Democratic candidate was Cleveland. He was against high tariff rates. Harrison won the election by winning the electoral vote, but not the popular vote. As a result of the election of 1888, Republicans gained control of both houses of Congress and the White House.

Continued The McKinley Tariff cut tariff rates on some goods, but increased the rates on others. It lowered federal revenue and left the nation with a budget deficit. A new pension law passed in 1890 for veterans furthered worsened the federal deficit. The Sherman Antitrust Act of 1890 made trusts illegal, although the courts did little to enforce the law.