National Labor Relations Act
Why Nations Fail: The Origins of Power, Prosperity, and PovertyThe National Labor Relations Act is presented as a cornerstone of the New Deal’s labor reforms: it strengthened workers’ ability to form unions, bargain collectively, and strike. Its passage and survival through constitutional challenge serve a second purpose in the book’s argument, showing that institutional checks could limit executive power without preventing durable reforms to workers’ rights.
New Deal Context
The act followed the National Industrial Recovery Act, which sought to aid industrial recovery by restraining competition, expanding workers’ rights to form unions, and regulating working conditions. After the Supreme Court struck down Title I of that earlier law in 1935, Roosevelt’s administration pursued further measures. Among them were the Social Security Act, which established retirement pensions, unemployment benefits, aid to families with dependent children, and some public-health and disability benefits, and the National Labor Relations Act, which strengthened workers’ rights to organize.
These measures emerged amid a wider effort to respond to the Depression and reshape the relationship between workers, employers, and government. The labor law was not simply an isolated policy: it made collective organization and bargaining more secure, while the court challenges to New Deal legislation raised the question of how far the federal government could go in addressing economic crisis.
Rights and Constitutional Challenge
The National Labor Relations Act strengthened the rights of workers to organize unions, engage in collective bargaining, and conduct strikes against employers. In doing so, it supported workers acting together rather than confronting employers only as individuals. The book places this protection within a broader account of empowerment through organized groups and coalitions, while distinguishing political inclusion from the mere existence of elections or formal democratic institutions.
The act faced challenges in the Supreme Court as it moved through the judiciary. Roosevelt’s confrontation with the Court intensified after his 1936 reelection, in which he received 61 percent of the popular vote. Seeking to protect his agenda from judicial opposition, he proposed compulsory retirement for judges at seventy and authority to appoint up to six additional justices. The proposed Judiciary Reorganization Bill would have enabled him to alter the Court’s composition, including by replacing justices appointed by more conservative administrations.
Survival and Institutional Significance
Congress did not accept Roosevelt’s attempt to change the Court’s structure. The Senate voted 70 to 20 to return the bill to committee, and the court-packing provisions were removed. Roosevelt therefore remained unable to eliminate the judicial constraints on his power. Yet the outcome was not simply a defeat for the New Deal: both the National Labor Relations Act and the Social Security Act were ultimately ruled constitutional.
The episode illustrates the book’s distinction between adopting reforms and concentrating power to secure them. Legislators could have supported expanding the Court to protect policies they favored, but doing so risked weakening the separation of powers that constrained the president and protected pluralistic institutions. The act’s survival alongside the failure of the court-packing plan thus exemplifies a system in which institutional checks limited how reform could be pursued without extinguishing the reform itself.