National Industrial Recovery Act

National Industrial Recovery Act
U.S. Government · Public domain · source
Name	National Industrial Recovery Act
Enacted by	73rd United States Congress
Effective date	June 16, 1933
Signed by	Franklin D. Roosevelt
Long title	An Act to encourage industrial recovery and for other purposes
Status	struck down (1935)

Contents

National Industrial Recovery Act

The National Industrial Recovery Act was a 1933 United States statute enacted by the 73rd United States Congress and signed by Franklin D. Roosevelt as part of the New Deal. It aimed to stimulate industrial recovery during the Great Depression through industry codes, public works, and labor protections administered by the National Recovery Administration and the Public Works Administration. The measure generated intense political, legal, and economic controversy involving figures such as Hugh S. Johnson, organizations like the American Federation of Labor, and institutions including the Supreme Court of the United States.

Background

The Act emerged amid the economic collapse initiated by the Stock Market Crash of 1929 and the ensuing Great Depression. The Roosevelt administration, drawing on advisors from the Brain Trust, including Rexford Tugwell, Benjamin Cohen, and Adolf A. Berle Jr., sought rapid relief via emergency legislation influenced by earlier interventions like the Emergency Banking Act and the Civilian Conservation Corps. Congressional debates involved legislators such as Senator Robert M. La Follette Jr. and Representative Sam Rayburn and stakeholders from the Chamber of Commerce of the United States, the National Association of Manufacturers, and labor federations including the Congress of Industrial Organizations and the American Federation of Labor. Economic thought leaders such as John Maynard Keynes, Alfred E. Smith, and W. E. B. Du Bois commented on industrial policy while legal scholars from Harvard University, Yale University, and the Columbia Law School scrutinized constitutional implications.

Key provisions established the National Recovery Administration to draft industry-wide "codes of fair competition" collaborating with firms such as U.S. Steel, General Motors, Ford Motor Company, and Standard Oil of New Jersey. The Act authorized the Public Works Administration under Harold L. Ickes to fund public construction projects like the Bonneville Dam, municipal buildings in New York City, and infrastructure in Tennessee Valley Authority regions. Labor measures included a provision for collective bargaining rights and a statutory minimum wage affecting workers in industries represented by unions such as the International Brotherhood of Teamsters, the United Mine Workers of America, and the United Auto Workers. The Act also contained sections on price setting, production quotas, and trade associations, impacting companies such as AT&T, Westinghouse Electric, and Bethlehem Steel.

Administration of the program relied on administrators including Hugh S. Johnson (head of the National Recovery Administration) and public works oversight by Harold L. Ickes (head of the Public Works Administration). State officials from California, New York, Illinois, Pennsylvania, and Texas coordinated with federal agents and industry leaders like J. P. Morgan affiliates and CEOs including Alfred P. Sloan and Walter P. Chrysler. Business groups such as the National Association of Manufacturers and the American Petroleum Institute engaged in code drafting alongside labor bodies including the American Federation of Labor and critics in the American Liberty League. Implementation saw collaboration with municipal entities like the City of Chicago and educational institutions including Columbia University for economic surveys, and with legal teams from firms such as Sullivan & Cromwell.

The Act provoked constitutional litigation brought by entities such as Schechter Poultry Corp., labor litigants represented in cases tied to the National Labor Relations Board precursor disputes, and business litigants including National Biscuit Company. Opponents argued violations of the Commerce Clause and nondelegation doctrine; prominent attorneys included members of the American Bar Association and scholars from Harvard Law School and Yale Law School. The dispute culminated in the Supreme Court case led by Chief Justice Charles Evans Hughes and opinions by Justices including Benjamin N. Cardozo, Harlan F. Stone, and Pierce Butler. In 1935 the Court in decisions such as those connected with A.L.A. Schechter Poultry Corp. v. United States struck down key sections, finding the Act's delegation of legislative power and extent of interstate commerce regulation unconstitutional.

In the short term the Act affected industrial leaders like Andrew W. Mellon and unions including the United Mine Workers of America and the United Auto Workers, influenced hiring at firms such as Eastman Kodak and Goodyear Tire and Rubber Company, and funded construction projects that employed workers in cities including Detroit, Cleveland, and Pittsburgh. The Public Works Administration financed projects ranging from the Triborough Bridge to university buildings at Harvard University and Princeton University, while social programs intersected with agencies such as the Federal Emergency Relief Administration and the Works Progress Administration. Critics from the Liberty League (United States) and commentators like Alf Landon and Huey Long questioned efficacy; supporters including Frances Perkins and Eugene V. Debs allies emphasized worker protections. Macroeconomic effects remain debated among economists at institutions such as the National Bureau of Economic Research, University of Chicago, and Massachusetts Institute of Technology.

Scholars from Columbia University, Princeton University, and Yale University evaluate the Act as a pivotal experiment in federal regulatory policy that informed later measures like the National Labor Relations Act and the Fair Labor Standards Act. Political figures including Harry S. Truman and historians such as Arthur M. Schlesinger Jr. and David M. Kennedy have assessed its role in shaping the New Deal coalition. Legal doctrine evolved through subsequent jurisprudence influenced by the Act's invalidation, with commentary from jurists at the Supreme Court of the United States and scholars from Harvard Law School and University of Chicago Law School. Infrastructure and labor developments trace to projects and organizational changes involving entities like the Tennessee Valley Authority and labor federations including the Congress of Industrial Organizations. The Act remains a subject of study in courses at institutions such as Georgetown University, Stanford University, and University of California, Berkeley.