National Industrial Recovery Act

Definition

The National Industrial Recovery Act (NIRA) was a landmark piece of legislation enacted in 1933 as part of the New Deal, aimed at revitalizing the American economy during the Great Depression. It sought to stimulate industrial growth and improve labor conditions by establishing codes of fair competition, promoting workers' rights to unionize, and regulating prices and wages in various industries. NIRA played a crucial role in laying the groundwork for modern labor relations and economic reform in the United States.

5 Must Know Facts For Your Next Test

1. NIRA was signed into law by President Franklin D. Roosevelt on June 16, 1933, as part of his administration's response to the economic crisis.
2. The act allowed industries to create their own codes of fair competition, which were then approved by the government to ensure fair practices and protect workers' rights.
3. NIRA established the National Recovery Administration (NRA), which was responsible for enforcing these codes and promoting industrial recovery.
4. One significant aspect of NIRA was its support for labor rights, including the right for workers to organize and join unions without fear of retaliation.
5. The Supreme Court declared NIRA unconstitutional in 1935, leading to its eventual dissolution, but its principles influenced later labor legislation.

Review Questions

• How did the National Industrial Recovery Act aim to improve labor conditions during the Great Depression?
  • The National Industrial Recovery Act aimed to improve labor conditions by promoting workers' rights to organize and join unions, ensuring fair wages and hours through the establishment of industry codes. The act recognized that improved labor conditions would help stimulate consumer spending, ultimately aiding economic recovery. By supporting collective bargaining, it empowered workers to negotiate better terms with their employers.
• What were the key components of the codes established under the National Industrial Recovery Act, and how did they impact various industries?
  • The codes established under the National Industrial Recovery Act included provisions for fair competition, setting minimum wages, maximum working hours, and establishing collective bargaining rights. These codes varied by industry but were designed to eliminate unfair practices that could harm both workers and businesses. By fostering cooperation among competing firms, these codes aimed to stabilize prices and promote economic recovery across various sectors.
• Evaluate the long-term effects of the National Industrial Recovery Act on American labor relations and economic policy.
  • The National Industrial Recovery Act had significant long-term effects on American labor relations and economic policy despite its eventual demise. It laid the foundation for future labor laws like the Wagner Act, which solidified workers' rights to unionize. The act's emphasis on regulating industry practices also set a precedent for government intervention in the economy, shaping the framework for modern economic policies that balance business interests with worker protections.

Related terms

Wagner Act: Also known as the National Labor Relations Act, this 1935 legislation established workers' rights to organize unions and engage in collective bargaining.

Public Works Administration: A New Deal agency created to oversee the construction of large-scale public works projects, aimed at creating jobs and stimulating the economy.

Fair Labor Standards Act: Passed in 1938, this act set minimum wage and overtime pay standards and aimed to eliminate labor conditions detrimental to the health and well-being of workers.