National Industrial Recovery Act

Definition

The National Industrial Recovery Act (NIRA) was a key piece of legislation enacted in 1933 as part of the New Deal, aimed at revitalizing the U.S. economy during the Great Depression. It sought to stimulate industrial growth by establishing codes of fair competition, setting prices, and regulating working conditions. NIRA also included provisions for labor rights, helping to empower workers and encourage unionization, thus playing a significant role in shaping labor relations in the United States.

5 Must Know Facts For Your Next Test

1. The National Industrial Recovery Act was signed into law by President Franklin D. Roosevelt on June 16, 1933, as a response to the economic crisis caused by the Great Depression.
2. NIRA aimed to stimulate economic recovery by promoting industrial growth and improving labor conditions, which included establishing minimum wages and maximum working hours.
3. The act faced challenges and was eventually declared unconstitutional by the Supreme Court in 1935, specifically in the case of Schechter Poultry Corp. v. United States.
4. Despite its eventual downfall, NIRA set the groundwork for future labor rights advancements and led to the establishment of important agencies such as the National Labor Relations Board (NLRB).
5. NIRA was significant for its emphasis on cooperation between industry and government, aiming to create a balanced approach to economic recovery during a time of great hardship.

Review Questions

• How did the National Industrial Recovery Act attempt to address the economic challenges of the Great Depression?
  • The National Industrial Recovery Act aimed to tackle the economic difficulties of the Great Depression by establishing codes of fair competition that promoted industrial growth and stabilized prices. It sought to improve labor conditions by setting minimum wages and maximum working hours while also empowering workers through Section 7(a), which protected their rights to organize and bargain collectively. By promoting cooperation between industry and government, NIRA aimed to revitalize the economy during a time of severe distress.
• Evaluate the impact of the National Industrial Recovery Act on labor relations in the United States.
  • The National Industrial Recovery Act significantly impacted labor relations by including provisions that supported workers' rights, most notably through Section 7(a), which encouraged unionization and collective bargaining. This led to an increase in labor activism and laid the foundation for future legislation, such as the National Labor Relations Act in 1935. The establishment of these rights marked a pivotal shift in labor relations, giving workers more power and influencing how businesses interacted with unions and employees.
• Analyze the reasons behind the Supreme Court's decision to declare the National Industrial Recovery Act unconstitutional and its implications for New Deal policies.
  • The Supreme Court declared the National Industrial Recovery Act unconstitutional primarily due to concerns over its delegation of legislative power to the executive branch, which was seen as violating the principle of separation of powers. In particular, the Court ruled that NIRA's provisions allowed too much discretion in regulating industries without clear standards. This decision highlighted tensions between governmental authority and economic regulation during the New Deal era, leading to adjustments in future policies as New Deal programs evolved to align more closely with constitutional interpretations while still seeking to address economic challenges.

Related terms

Public Works Administration: A New Deal agency created under the NIRA that funded large-scale public works projects to create jobs and improve infrastructure.

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

Section 7(a): A provision within the NIRA that guaranteed workers the right to organize and collectively bargain, marking a significant advancement for labor rights.