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===The NRA "Blue Eagle" campaign===

===The NRA "Blue Eagle" campaign===

[[Image:Blue-nra.jpg|thumb|300px}left|NRA "Blue Eagle" stamps]]

[[Image:Blue-nra.jpg|thumb|300px}left|NRA "Blue Eagle" stamps]]

   

New Deal economists argued that cut-throat competition had hurt many businesses and that with prices having fallen 20% and more, "deflation" exacerbated the burden of debt and would delay recovery. They rejected a strong move in Congress to limit the workweek to 30 hours. Instead their remedy, designed in cooperation with the Chamber of Commerce (representing big business), was the NIRA. It included billions in stimulus funds for the PWA to spend, and sought to to raise prices, give more bargaining power for unions (so the workers could purchase more) and reduce harmful competition.<ref> Unions in 1933-35 were small and weak; they took off after 1935.</ref> At the center of the NIRA was the National Recovery Administration (NRA), headed by former General [[Hugh Samuel Johnson]], who had been a senior economic official in World War I. 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.<ref>Arthur Schlesinger, Jr. ''The Coming of the New Deal'' (1959), 87-135 </ref>

 

At the center of the NIRA was the National Recovery Administration (NRA), headed by former General [[Hugh Samuel Johnson]]. Johnson called on every business establishment in the nation to accept a stopgap "blanket code": a minimum wage of between 20 and 40 cents an hour, a maximum workweek of 35 to 40 hours, and the abolition of child labor. Johnson and Roosevelt contended that the "blanket code" would raise consumer purchasing power and increase employment.

 

 

To mobilize political support for the NRA, and the administrations "blanket code", Johnson launched the "NRA [[Blue Eagle]]" publicity campaign to boost his bargaining strength to negotiate the codes with business and labor. The NRA negotiated specific sets of codes with leaders of the nation's major industries; the most important provisions were anti-deflationary floors below which no company would lower prices or wages, and agreements on maintaining employment and production. In a remarkably short time, the NRA won agreements from almost every major industry in the nation. Six months after the NRA went into effect industrial production dropped 25 percent. Donald Richberg, who soon replaced Johnson as the head of the NRA said:

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There is no choice presented to American business between intelligently planned and uncontrolled industrial operations and a return to the gold-plated anarchy that masqueraded as "rugged individualism."...Unless industry is sufficiently socialized by its private owners and managers so that great essential industries are operated under public obligation appropriate to the public interest in them, the advance of political control over private industry is inevitable.<ref>Schlesinger, ''The Coming of the New Deal'' p. 115</ref>

There is no choice presented to American business between intelligently planned and uncontrolled industrial operations and a return to the gold-plated anarchy that masqueraded as "rugged individualism."...Unless industry is sufficiently socialized by its private owners and managers so that great essential industries are operated under public obligation appropriate to the public interest in them, the advance of political control over private industry is inevitable.<ref>Arthur Meier

 

Schlesinger, Jr. ''The Coming of the New Deal,'' (1957), p. 115</ref>

 

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By the time NRA ended in May 1935, industrial production was 55% higher than in May 1933. On May 27, 1935, the NRA was found to be unconstitutional by a unanimous decision of the U.S. Supreme Court in the case of ''[[Schechter v. United States]]''. On that same day, the Court unanimously struck down the Frazier-Lemke Act portion of the New Deal as unconstitutional. Some libertarians such as [[Richard Ebeling]] see these and other rulings striking down portions of the New Deal as preventing the U.S. economic system from becoming a [[planned economy]] corporate state.<ref> [http://64.233.161.104/search?q=cache:fHF_o54pFCEJ:www.fee.org/pdf/the-freeman/1005RME "When the Supreme Court Stopped Economic Fascism in America"]. By Richard Ebeling, president of [[Foundation for Economic Education]]. Oct. 2005.</ref>

 

By the time it ended in May 1935, industrial production was 22% higher than in May 1933. On May 27 1935, the NRA was found to be unconstitutional by a unanimous decision of the U.S. Supreme Court in the case of [[Schechter v. United States]].<ref> On that same day, the Court unanimously struck down as unconstitutional the Frazier-Lemke Act that put a moratorium on farm mortgages.</ref>

[[Image:US-mfg20-40.jpg|thumb|400px|Chart 3: employment in manufacturing 1920-1940, in millions]]

[[Image:US-mfg20-40.jpg|thumb|400px|Chart 3: employment in manufacturing 1920-1940, in millions]]

Employment in private sector factories recovered to the level of the late 1920s by 1937 (see chart 2), but did not grow much bigger until the war came; during the war manufacturing employment leaped from 11 million in 1940 to 18 million in 1943.

Employment in private sector factories recovered to the level of the late 1920s by 1937 (see chart 2), but did not grow much bigger until the war came; during the war manufacturing employment leaped from 11 million in 1940 to 18 million in 1943.

==Second New Deal==

==Second New Deal==