National Industrial Recovery Act

The National Industrial Recovery Act was a major New Deal statute designed to combat the economic collapse of the Great Depression. It sought to foster industrial recovery by restraining competition, supporting workers’ rights to organize, and regulating working standards; its rapid defeat in the Supreme Court made it a defining example of the limits constitutional institutions could place on a popular president’s program.

Background and aims

Franklin D. Roosevelt took office in early 1933 amid severe economic distress: one-quarter of the labor force was unemployed, industrial production had fallen by more than half since the Depression began in 1929, and investment had collapsed. Elected in 1932 with 57 percent of the popular vote, Roosevelt entered office with Democratic majorities in both houses of Congress and a mandate to pursue an ambitious recovery agenda, collectively known as the New Deal.

The Act’s Title I addressed industrial recovery. Roosevelt and his advisers regarded restraints on industrial competition, expanded rights for workers to form trade unions, and regulation of working standards as essential to recovery. The measure thus joined economic intervention to a broader effort to change the terms on which employers and workers interacted.

Public works and implementation

Title II established the Public Works Administration, which undertook infrastructure projects. Among the projects associated with it were Philadelphia’s Thirtieth Street railroad station, the Triborough Bridge, the Grand Coulee Dam, and the Overseas Highway linking Key West, Florida, with the mainland. The Act was signed on June 16, 1933, and put into operation, but it immediately faced legal challenges.

The statute’s two titles represented distinct parts of the New Deal effort: Title I sought to reshape industrial relations and promote recovery, while Title II supported public works. The Supreme Court challenge focused on Title I, so the Court’s ruling against that provision should not be mistaken for a ruling described in the evidence as invalidating every activity established under the Act.

Supreme Court ruling

On May 27, 1935, the Supreme Court unanimously ruled Title I unconstitutional. The justices stated, “Extraordinary conditions may call for extraordinary remedies. But … extraordinary conditions do not create or enlarge constitutional power.” The decision set a constitutional boundary on the administration’s response to the crisis: the scale of unemployment and economic collapse did not, by itself, expand the powers available to the federal government.

The ruling also exposed the difference between political authorization and constitutional authority. Roosevelt’s electoral mandate and legislative majorities had enabled Congress to pass the New Deal measure, but they could not guarantee that its provisions would survive judicial review. In the book’s account, the case belongs to a wider pattern in which courts and legal constraints could limit powerful political actors rather than simply ratify their objectives.

Place in the New Deal

Before the Court ruled, Roosevelt had already moved forward with other parts of his program. He signed the Social Security Act, establishing pensions, unemployment benefits, assistance to families with dependent children, and some public health care and disability benefits. He also signed the National Labor Relations Act, which further strengthened workers’ rights to organize unions, bargain collectively, and strike. Those measures, too, faced challenges in the Supreme Court.

Roosevelt was reelected in 1936 with 61 percent of the popular vote while those challenges were proceeding. The National Industrial Recovery Act therefore stands at an early and consequential point in the New Deal’s encounter with constitutional review: it advanced an ambitious attempt to address economic crisis, but its central industrial-recovery title did not survive the Court’s scrutiny.