National Industrial Recovery Act

Definition

The National Industrial Recovery Act (NIRA) was a key component of President Franklin D. Roosevelt's New Deal legislation, enacted in 1933 to address the economic challenges of the Great Depression. The act aimed to promote economic recovery and stabilize industries through a partnership between businesses, workers, and the government.

5 Must Know Facts For Your Next Test

1. The NIRA allowed industries to create 'fair competition' codes that set minimum wages, maximum work hours, and other labor standards.
2. The act was designed to promote economic recovery by reducing 'cutthroat competition' and stabilizing prices and production.
3. The NIRA's 'Blue Eagle' symbol was used to designate businesses that agreed to abide by the act's regulations, including minimum wages and maximum work hours.
4. Section 7(a) of the NIRA guaranteed workers the right to organize and bargain collectively, leading to a surge in union membership.
5. The National Recovery Administration (NRA) was the government agency established to oversee the implementation of the NIRA and develop industry-specific 'fair competition' codes.

Review Questions

• Explain the primary goals and mechanisms of the National Industrial Recovery Act (NIRA) in the context of the First New Deal.
  • The National Industrial Recovery Act (NIRA) was a key component of President Franklin D. Roosevelt's First New Deal, aimed at promoting economic recovery and stabilizing industries during the Great Depression. The act allowed industries to create 'fair competition' codes that set minimum wages, maximum work hours, and other labor standards. The goal was to reduce 'cutthroat competition' and stabilize prices and production, thereby stimulating economic growth. The NIRA also established the National Recovery Administration (NRA) to oversee the implementation of the act and develop industry-specific codes.
• Describe the impact of the NIRA's Section 7(a) on labor relations and union membership during the First New Deal.
  • Section 7(a) of the National Industrial Recovery Act (NIRA) guaranteed workers the right to organize and bargain collectively. This provision led to a significant surge in union membership, as workers took advantage of their newfound legal protections to form and join labor unions. The increased bargaining power of organized labor transformed the dynamics of labor relations during the First New Deal, as businesses were forced to negotiate with empowered workers and their representatives. This shift in the balance of power between labor and management was a key aspect of the NIRA's impact on the economic and social landscape of the era.
• Analyze the Supreme Court's ruling on the NIRA and the implications of this decision for the First New Deal and the role of the federal government in the economy.
  • In 1935, the Supreme Court ruled the National Industrial Recovery Act (NIRA) unconstitutional in the case of Schechter Poultry Corp. v. United States. The Court determined that the NIRA's delegation of legislative power to the executive branch and its regulation of intrastate commerce exceeded the federal government's constitutional authority. This ruling was a significant setback for the First New Deal, as it undermined the federal government's ability to directly intervene in the economy and coordinate industry-wide recovery efforts. The Schechter Poultry decision highlighted the limitations on the federal government's power to regulate the economy and shaped the subsequent evolution of New Deal policies, which sought to find alternative constitutional avenues for economic intervention and reform.

Related terms

Blue Eagle: The symbol used to designate businesses that agreed to abide by the NIRA's regulations, including minimum wages and maximum work hours.

Section 7(a): A provision in the NIRA that guaranteed workers the right to organize and bargain collectively, which led to a surge in union membership.

National Recovery Administration (NRA): The government agency established to oversee the implementation of the NIRA, which developed industry-specific 'fair competition' codes.