The NRA in the Early New Deal

In 1933, Franklin Delano Roosevelt, the 32nd President of the USA, started his first term of presidency. The beginning of the 1930’s saw America in the Deep Depression and economic decline. To improve the situation, the newly elected democratic president created a program of Relief for poor and unemployed, Recovery for economy and higher standard of living, and Reform of the financial system. The National Recovery Administration (NRA) was the main executive body of the Recovery course. The NRA aimed at deflation, elimination, and prices’ stabilization. General Hugh Johnson headed the NRA; he abolished the child labor, constituted minimum wage of 20-45 cents per hour and maximum workweek of 35-45 hours. In March of 1934, industrial productivity increased in 45% in comparison with the March of 1933. However, May of 1935 was a black page for the NRA program as it was recognized unconstitutional by the United States Supreme Court.

1.What Was the Problem?

The NRA enforced 541 approved codes, which were written by the corporations themselves. The main goals of the NRA were the stabilization of business with code of “fair,” generation of purchasing power providing raising wages, jobs places, defining labor standards, and comprehensive job time planning. The 32nd President was so preoccupied with the New Deal Campaign that recklessly treated the existing US Constitution, even though it was the duty of any new program to stay within the Constitutional boundaries. In his further policy, Franklin Delano Roosevelt attempted to change the Supreme Court’s structure and Justice, in order to adopt them to his program. In 1933-1935, he did not foresee these possible consequences, and the NRA suffered the most. The legal problems of the program can be summarized into two positions; Donald R. Richard questions, “How shall the law be interpreted and applied so as to accomplish its objects? How shall the administration of the law be kept within the limitations of the Constitution of the US?” (682). The head of the United States did not take into consideration aforesaid statements and, in two years, his recovery program was unanimously decided to be unconstitutional, and its authorities were stopped.

2.What Were the Facts?

The NRA implemented its policy with the help of the Public Works Administration. It was prescribed that the PWA would supply the workers with money, so that they spend them on the NRA organized business. Within the first time, the NRA made Americans confident and able to conquer the fears and results of the Depression. More than 22 million workers were covered with the NRA codes. President Roosevelt led the “Fireside Chats” radio program, in which he explained his policy views and made audience ready to the NAR program implementation. Companies subscribed to the program codes displayed a Blue eagle emblem. By mid July of 1933, it became so popular that the symbol of the NRA cooperation with the motto "We do our part!" was seen almost everywhere in the shops and on the products. Nevertheless, after beginning of the recovery, the daily annoyance appeared among the businesspersons and, in two years, it provoked a lot of criticism. Nevertheless, enthusiasm dropped down by fall. The workers wages were extremely low, and labor hours very long, moreover the job places were provided for only one third of the unemployed. Moreover, the Black people were not easily accepted for the public work; it was hard for widows and single women to find the job, as well. The Social Security worked out the program of old-age pensions, but it excluded a huge percent of working people; all these tendencies and events caused the crowded strikes.

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In the article “Myth of Benevolent Roosevelt Democrats:The Real Deal on the “NewDeal” Andrew Pollack describes that despite all these,

Workers built and repaired one million miles of roads and 200,000 public facilities, including schools, playgrounds, courthouses, parks and athletic fields, swimming pools, bridges, and airports, drained malarial swamps, and exterminated rats in slums. They created works of art, gave concerts, set up theaters throughout the country, even in small towns, set up nursery schools, served over 1.2 billion school lunches to needy children, gave immunizations, taught illiterate adults to read and write, and wrote state guidebooks—classics that are still in use. They sewed 383 million coats, overalls, dresses and other garments, and, using surplus cotton collected by the Agricultural Adjustment Administration, made more than a million mattresses that were given to destitute families, as were the garments. CCC workers planted 2 billion trees, including many on burned or eroded hillsides, stocked nearly a billion fish, and built a network of fire-lookout towers, roads, and trails (n.p.).

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The NRA did not achieve its aims of recovery and re-employment and was closed after the case of Schechter Poultry Corporation versus United States in 1935, when the Court recognized wage and price fixing to be unconstitutional.

3. What Controversies Arose?

The NRA was the most controversial program of the New Deal. From the very beginning, the Republicans were split with conservatives opposing the grudges of business and economic prosperity. Among the citizens, the NRA was perceived as the hopeful solution, the one could see the parade down the Fifth Avenue in New York with over 250 thousand people in support of the NRA and the “Blue Eagle.” Nevertheless, in two years, these people struck against the policy and demanded changes.

The controversy between the President and industry was based on the price level adjustment. Roosevelt insisted on keeping the prices down, while the industry desired price fixing powers. In the choice between the monopoly and collective socialized ownership and control, Roosevelt preferred the first.

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The Black part of the United States voted for the democrat representative for the first time; more than 80% of the Black-skinned inhabitants supported Franklin Delano Roosevelt during his first election campaign. Nevertheless, the NRA program failed to do much to them; most of these people were unemployed or earned less for the same job than the White-skinned person did. The majority of the Black continued performing their physical jobs without any perspectives.

4.What Were the Stands that Different Parties and Concerned Groups Took on the Issue?

With the existence of different controversies in that time, many parties and concerned groups took their stands on the issue. The majority of the Democratic parties and liberals stood for the New Deal with the NRA, so Republicans and minority of the democratic conservatives formed the Conservative Coalition. The Coalition opposed the federal power propagation; they saw the happy and prosperous America’s future in the enterprises, but not monopoly.

As was mentioned before, while working, the people had built up the infrastructure projects and appreciated the need of it. However, the labor and radical movements opposed such spending and appealed to saving policy to avoid the devastating economic crisis and the threat of revolution. Besides the politicians, the NRA dealt with diverse banking, farming, railroads, and industry groups, which tried to defend their business, in 1934. The matter of the issue was that price-fixing in many instances injured small competitors and aided the natural advantage of the powerful firms of codified industries. Clarence Darrow confirmed this point of view against the current and widely accepted agency.

5.Why Is the Issue Important?

The New Deal and the NRA are recognized as a failure, because between 1933 and 1937 improvement of the situation caused a deep recession relapse. Nevertheless, this President’s initiative had not only negative sides and effects. The NRA succeeded in the complete reunion of the nation by the common idea of striving for the better life. It united labor units and people of different races, backgrounds, and social groups. The accepted in that time codes are the nowadays standards for employers and employees, for example, the 40-hour workweek and the cancellation of the children’s work. Old-age people still receive the pansies but without exceptions. In addition, it made headway in the petroleum industry; prescribed code controlled the amount of the producing oil, and permitted monopolistic practices, the share of the manufacturing, transportation, and marketing facilities.

6. Why Did they Adopt Whatever Solution They Came up with?

The first year of Roosevelt’s government was a critical period for the United States, which demanded immediate actions to change the overall situation in the country. The NRA and the New Deal sometimes are considered a historical curiosity and bad thought-out reaction, but it is a delusion. Franklin Roosevelt did not analyze the problem himself, the economists John Stuart Mill and John Maynard Keynes greatly influenced his decision. Besides, the NRA roots originated from the previous years reforms.

In 1841, the Roosevelt’s ancestor Clinton Roosevelt worked out the same schema of industrial changes. In 1920, Bernard Baruch also was shaping the NRA resemble program. In addition, Roosevelt’s NRA, in fact, was a detailed plan presented by Gerard Swope (1872-1957). All these facts prove that Roosevelt’s decision was well thought-out and based on the previous leaders experiences. NRA, created by the 32nd President of the USA, was not the best sample for the following generations; however, it was the best solution in that dark period. Franklin Roosevelt can be blamed or honored for his policy, but the fact that he is still the only President of the USA elected more than twice speaks for itself.

7.Why Does the Issue Matter in the Long Term?

“Roosevelt saw the NRA as "the means for a long-run reform and reorganization of the economy” (Martin n.p.). The most important long-term results of the issue are not reflected fully by financial indicators. The NRA established a new labor policy and had a body to enforce it. The New Deal is the most controversial program, which has boosted the national morale and become the perfect sample of the psychological function statement.

The article “Industrial Recovery” proved once again the importance and long term effects of the NRA issues, “Many of the NRA policies, such as setting minimum wage and restricting work hours, were successfully reenacted under the National Labor Relations Act (aka Wagner Act) passed in July 1935” (American Studies of Virginia University n.p.).

The New Deal Creations, just like the Federal Communications Commission, the Civil Aeronautics Board, the Farm Security Administration, and the National Labor Relations Board, still exists, and it is deeply entrenched in the modern policy of the country.

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