While much of the legislation of the first hundred days focused on immediate relief and job creation through federal programs, Roosevelt was committed to addressing the underlying problems inherent in the American economy. He created two of the most significant pieces of New Deal legislation in his efforts: the Agricultural Adjustment Act (AAA) and the National Industry Recovery Act (NIRA).
Farms around the country were suffering but from different causes. In the Great Plains, drought conditions meant that little was growing at all, while in the South, bumper crops and low prices meant that farmers could not sell their goods at prices that could sustain them. The AAA offered some direct relief: Farmers received $4.5 million through relief payments. But the more significant part of the program paid southern farmers to reduce their production: Wheat, cotton, corn, hogs, tobacco, rice, and milk farmers were all eligible. Passed into law on May 12, 1933, the AAA aimed to raise the prices of agricultural commodities (and hence farmers’ income) by offering cash incentives to voluntarily limit farm production (decreasing supply, thereby increasing prices). [1] These price increases would be achieved by encouraging farmers to limit production to increase demand while receiving cash payments. Corn producers would receive thirty cents per bushel for corn they did not grow. Hog farmers would get five dollars per head for hogs not raised. A tax on processing plants would finance the program, passed on to consumers through higher prices.
This was a bold attempt to help farmers address the systemic problems of overproduction and lower commodity prices. Despite previous efforts to regulate farming through subsidies, never before had the federal government intervened on this scale; the notion of paying farmers not to produce crops was unheard of. However, one significant problem was that, in some cases, there was already an excess of crops, mainly cotton and hogs, which clogged the marketplace. A bumper crop in 1933, combined with the slow implementation of the AAA, led the government to order the plowing of ten million acres of cotton and the butchering of six million baby pigs and 200,000 sows. Although it worked to some degree—the price of cotton increased from six to twelve cents per pound—this move was deeply problematic. Critics saw it as the ultimate example of corrupt capitalism: a government destroying food while its citizens were starving to drive up prices.
While Roosevelt hoped the AAA would help farms and farmers, he also sought aid for the beleaguered manufacturing sector. The Emergency Railroad Transportation Act created a national railroad office to encourage cooperation among different railroad companies, hoping to shore up an industry essential to the stability of the manufacturing sector but one that had been devastated by mismanagement. The National Industrial Recovery Act (NIRA), which created the National Recovery Administration in June 1933, suspended antitrust laws to allow businesses to establish “codes” that would coordinate prices, regulate production levels, and set conditions of employment to curtail “cutthroat competition.” In exchange for these exemptions, businesses agreed to provide reasonable wages and hours, end child labor, and allow workers the right to unionize.
A new government agency, the National Recovery Administration (NRA), was central to this plan and mandated that businesses accept a code that included minimum wages and maximum work hours. To protect workers from potentially unfair agreements among factory owners, every industry had its own “code of fair practice” that included workers’ rights to organize and use collective bargaining to ensure wages rose with prices. Participating businesses earned the right to display a placard with the NRA’s Blue Eagle, showing their cooperation in the effort to combat the Great Depression. [2]
Headed by General Hugh S. Johnson, the NRA worked to create over five hundred different codes for different industries. The administration of such a complex plan naturally created its own problems. While regulations for critical sectors such as automotive and steel made sense, Johnson pushed to develop similar codes for dog food manufacturers, those who made shoulder pads for women’s clothing, and even burlesque shows (regulating the number of strippers in any one show).
The NIRA also created the Public Works Administration (PWA). The PWA set aside $3.3 billion to build public projects such as highways, federal buildings, and military bases. Although this program suffered from political squabbles over appropriations for projects in various congressional districts and significant underfunding of public housing projects, it ultimately offered some of the most lasting benefits of the NIRA. Secretary of the Interior Harold Ickes ran the program, which completed over thirty-four thousand projects, including the construction of the Golden Gate Bridge in San Francisco and the Queens-Midtown Tunnel in New York. Between 1933 and 1939, the PWA accounted for the construction of over one-third of all new hospitals and 70 percent of all new public schools in the country.
Another challenge faced by the NRA was that the provision granting workers the right to organize appeared to others as a mandate to do so. In previously unorganized industries, such as oil and gas, rubber, and service occupations, workers now sought groups that would assist in their organization, bolstered by the encouragement they now felt from the government. The Communist Party took advantage of the opportunity to assist in the hope of creating widespread protests against the American industrial structure.
The number of strikes nationwide doubled between 1932 and 1934, with over 1.5 million workers going on strike in 1934 alone, often in protests that culminated in bloodshed. That summer, a strike at the Auto-Lite plant in Toledo, Ohio, resulted in ten thousand workers from other factories joining in sympathy with their fellow workers to attack potential strike-breakers with stones and bricks. Simultaneously in Minneapolis, a Teamsters Union strike resulted in frequent, bloody confrontations between workers and police, leading the governor to contemplate declaring martial law before the companies agreed to negotiate better wages and conditions for the workers. Finally, a San Francisco strike among 14,000 longshoremen closed the city’s waterfront and eventually led to a general strike of over 130,000 workers, essentially paralyzing the city. Clashes between workers, police, and National Guardsmen left many strikers bloodied and at least two dead.
Although Roosevelt’s relief efforts provided jobs to many and benefitted communities with the construction of several significant building projects, the violence erupted amid clashes between organized labor and factories backed by police and the authorities exposed a fundamental flaw in the president’s approach. Immediate relief did not address long-existing, inherent class inequities that exposed workers to poor working conditions, low wages, long hours, and little protection. For many workers, life on the job was not much better than life as an unemployed American. Employment programs may have put men back to work and provided much – needed relief. Still, the fundamental flaws in the system required additional attention—attention that Roosevelt could not pay in the early days of the New Deal. Critics were plentiful, and the president would be forced to address them in the years ahead.
This scripted sketch shows a songwriter trying to write an inspiring song for the NRA that would inspire American confidence and understanding of the NRA. How do you think propaganda like this impacted the American people who might have been uncertain about New Deal programs like the NRA?
The most prominent of Roosevelt’s job-creation programs included the Civilian Conservation Corps and the Public Works Administration (the latter under the auspices of the National Industrial Recovery Act). Both employed millions of Americans to work on thousands of projects. While programs such as the Tennessee Valley Authority were not incepted solely for the purpose of generating jobs, they nevertheless created thousands of employment opportunities in service of their greater goals. Direct relief came primarily from the Federal Emergency Relief Administration, which lent over $3 billion to states to operate direct relief programs from 1933 to 1935, and undertook several employment projects.
Show AnswerThe National Recovery Administration (NRA) established a “code of fair practice” for every industry. Business owners were made to accept a set minimum wage and a maximum number of work hours and recognize workers’ rights to organize and use collective bargaining. While the NRA established over five hundred different codes, it proved difficult to adapt this plan successfully for diverse industries with very different characteristics and practices.
The Agricultural Adjustment Act: the AAA aimed to raise the prices of agricultural commodities by incentivizing farmers to limit their production of certain commodities
National Industrial Recovery Act (NIRA): suspended antitrust laws to allow businesses to establish “codes” that would coordinate prices, regulate production levels, and set conditions of employment to curtail “cutthroat competition.”
National Recovery Administration (NRA): This program, created by the NIRA, mandated that businesses accept a code that included minimum wages and maximum work hours.
Public Works Administration (PWA): the PWA set aside $3.3 billion to build public projects such as highways, federal buildings, and military bases. It ultimately offered some of the most lasting benefits of the NIRA.
