Final answer:
The Hepburn Act of 1906 significantly strengthened the authority of the Interstate Commerce Commission by granting it the power to set maximum railroad rates, which marked a substantial enhancement in federal regulatory powers over railroads.
Step-by-step explanation:
The Hepburn Act of 1906 was a significant piece of legislation that empowered the Interstate Commerce Commission (ICC) with the authority to set maximum railroad rates and extend its reach to oversee more aspects of interstate transportation. This law came as a response to the ineffectiveness of earlier regulations to control the railroad industry's pricing practices, which often favored big businesses at the expense of smaller customers like farmers. The ICC, established by the Interstate Commerce Act of 1887, initially lacked the enforcement power necessary to regulate the railroads effectively.
With the passage of the Hepburn Act, not only was the ICC granted the ability to establish maximum rates, but the burden of proof in disputes over rates was shifted onto the railroads. This represented a move towards stronger federal oversight and regulation in the Progressive Era, as advocated by President Theodore Roosevelt, and marked a significant step forward from the earlier Elkins Act of 1903, which also targeted unfair railroad practices. The legislation was welcomed by Progressives and met with concern by conservatives and business leaders wary of increasing government intervention in private industry.