The National Recovery Administration (NRA) was a prime agency established by U.S. president Franklin D. Roosevelt (FDR) in 1933. The goal of the administration was to eliminate "cut throat competition" by bringing industry, labor, and government together to create codes of "fair practices" and set prices. The NRA was created by the National Industrial Recovery Act (NIRA) and allowed industries to get together and write "codes of fair competition". The codes intended both to help workers set minimum wages and maximum weekly hours, as well as minimum prices at which products could be sold. The NRA also had a two-year renewal charter and was set to expire in June 1935 if not renewed.
The NRA, symbolized by the Blue Eagle, was popular with workers. Businesses that supported the NRA put the symbol in their shop windows and on their packages, though they did not always go along with the regulations entailed. Though membership of the NRA was voluntary, businesses that did not display the eagle were very often boycotted, making it seem mandatory for survival to many.
In 1935, the U.S. Supreme Court unanimously declared that the NRA law was unconstitutional, ruling that it infringed the separation of powers under the United States Constitution. The NRA quickly stopped operations, but many of its labor provisions reappeared in the National Labor Relations Act (Wagner Act), passed later the same year. The long-term result was a surge in the growth and power of unions, which became a core of the New Deal Coalition that dominated national politics for the next three decades.
Background
As part of the "First New Deal", the NRA was based on the premise that the Great Depression was caused by market instability and that government intervention was necessary to balance the interests of farmers, business and labor. The NIRA, which created the NRA, declared that codes of fair competition should be developed through public hearings, and gave the Administration the power to develop voluntary agreements with industries regarding work hours, pay rates, and price fixing. The NRA was put into operation by an executive order, signed the same day as the passage of the NIRA.
New Dealers who were part of the administration of President Franklin D. Roosevelt saw the close analogy with the earlier crisis handling the economics of World War I. They brought ideas and experience from the government controls and spending of 1917–18.
In his June 13, 1933 "Statement on the National Industrial Recovery Act", President Roosevelt described the spirit of the NRA: "On this idea, the first part of the NIRA proposes to our industry a great spontaneous cooperation to put millions of men back in their regular jobs this summer." He further stated, "But if all employers in each trade now band themselves faithfully in these modern guilds—without exception—and agree to act together and at once, none will be hurt and millions of workers, so long deprived of the right to earn their bread in the sweat of their labor, can raise their heads again. The challenge of this law is whether we can sink selfish interest and present a solid front against a common peril."
Inception
The first director of the NRA was Hugh S. Johnson, a retired United States Army general who had been in charge of supervising the wartime economy in 1917–1918. He was named Time magazine's "Man of the Year" in 1933. Johnson saw the NRA as a national crusade designed to restore employment and regenerate industry.
Johnson called on every business establishment in the nation to accept a stopgap "blanket code": a minimum wage of between 20 and 45 cents per hour, a maximum workweek of 35 to 45 hours, and the abolition of child labor. Johnson and Roosevelt contended that the "blanket code" would raise consumer purchasing power and increase employment.
Historian Clarence B. Carson noted:
At this moment in time from the early days of the New Deal, it is difficult to recapture, even in imagination, the heady enthusiasm among a goodly number of intellectuals for a government planned economy. So far as can now be told, they believed that a bright new day was dawning, that national planning would result in an organically integrated economy in which everyone would joyfully work for the common good, and that American society would be freed at last from those antagonisms arising, as General Hugh Johnson put it, from "the murderous doctrine of savage and wolfish individualism, looking to dog-eat-dog and devil take the hindmost.