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H. Stone

The “New Deal” in Practice

Industrial Recovery Bill Hits
at Workers’ Standards

(June 1933)

From The Militant, Vol. VI No. 31, 17 June 1933, pp. 1 & 4.
Transcribed & marked up by Einde O’ Callaghan for the Encyclopaedia of Trotskyism On-Line (ETOL).

The National Industrial Recovery Act has at last become the law of the land. After several weeks of wrangling and, at one time even threatening to completely run wild, Congress has at last been whipped into line, and finally passed the bill in substantially the same manner in which it was originally advanced by the president The precise manner in which Roosevelt intends to use the powers delegated to him remains yet to be seen, but a brief scanning of the three months of new deal program makes one suspect very much that the new national industrial recovery deal will be nothing more than a continuation and an extension to the entire country of the Roosevelt dollar-a-day plan.

The National Industrial Recovery Act was originally conceived of by the president as a means of stemming a rising movement for a series of measures that were being advocated by various labor groups. The first and most potent of the measures which had begun to loom large on the economic horizon wai that for a six-hour day five-day week. Unexpectedly passed by the Senate, with support being given the bill by the liberals, the A.F. of L. and the railway unions, it began to appear that the Black Bill might suddenly pass from the realms of bills before Congress, to a measure waiting for the President’s signature. There was even talk of incorporating into the bill a national minimum wage law. Of course the amendments advanced by the Communists against a reduction in pay, were not even considered. Despite this however, all the manufacturers associations and local and national chambers of commerce rushed into the fray to defeat the bill. They found a capable ally in Franklin D. Roosevelt, who, running counter even to the proposals of his own Secretary of Labor Frances Perkins, requested that the thirty-hour week bill be dropped, and advocated in its stead, the present work.

What the Act Consists of?

The bill as it was finally passed consists of two sections. The first, devoted to the increase of public works, is most probably but another one of the many promises to increase public works that the American people became so familiar with under the Hoover regime. Over three billion dollars are to be expended for public works. What this means one cannot as yet say. Does this huge item include within itself the sums to be expended at Boulder Dam for the next five years? Does it include the four year expenditure contemplated in the Tennessee Valley? Does it include the three year naval building program? And does it include the ordinary yearly public works expenditures? Too often now, we have been treated to grandiose figures by the Hoover regime only to find at the end of the year that the total public works expenditure had been less than the year previously. True, the fact that the exact same thing occurred in the New York State regime of our former governor Franklin D. Roosevelt (promises of public works increases coupled with actual decreases observed at the end of the year) should not prejudice one against the three billion dollar outlay; but if nothing more, we remain at least skeptical.

The second section of the bill and by far the more important one is the industrial control section. This section has been hailed as a boon not merely to the industrialists but also to labor. This is the bill to increase profits, decrease unemployment, introduce a shorter work week, produce higher wages and put our entire industry on an organized basis. In short, this measure, like Lydia E. Pinkham’s pills, is good for whatever ails you be it falling hair, fallen arches, dandruff and falling teeth. What are the actual provisions of this section, and what is its history and the history of those empowered to enforce it? Only in this manner can we obtain an inkling as to what this huge all inclusive measure will actually mean.

The Origin of the Bill

A brief history of the origin of the bill has already been given. It was the administration’s way of side-tracking the agitation for the thirty-hour week, for the minimum wage, for no-reduction in pay. As for the man to enforce the provisions of the bill? It is the same Roosevelt who originated the dollar-a-day scheme for the Reforestation Army; it is the same Roosevelt who gave the veterans sugary words and then – a dollar a day; it is the same Roosevelt who forced through a federal wage cut to the lowest brackets; it is the same Roosevelt who has as his intimate counsellors and companions the Woodins and Davises of J.P. Morgan fame.

Let us consider the measure itself. It consists of a series of items, all of which have in their opening sentences the word “may.” Nothing is stated in a positive manner; all is left to the discretion of the President, the same Franklin Delano Roosevelt whose three months’ record has already branded him as the sugar coated starvation President. The most important items of the bill may be condensed as follows:


  1. Any trade or industrial group may adopt a code of “fair competition,” which code the president may approve, reject, modify or change. Where no code is agreed to by industry the President may draw one up for the trade.
  2. After a code is approved it is enforceable by law. The President may institute a licensing system to make the code effective; in that case nobody can engage in that business without a license.
  3. Any action under the bill is exempt from the anti-trust laws.
  4. In the industries affected by the bill, the workers are to have the right to collective bargaining; yellow dog contracts and the closed union shops are both outlawed, and the employers must apply the minimum wages, maximum hours and labor conditions, “approved or prescribed by the president.” These standards are to be worked out by collective agreement between labor and employers if possible. But where no agreement is approved by him, the president may prescribe a labor code of his own making.
  5. The duration of the law is one year.

Such are the provisions of the bill. In brief, industry is told to organize under government supervision and warned that, should a branch of industry fail to come to any agreement suitable to the government, a “fair code” will be forced upon it, and any protesting will be refused the “license” necessary to continue to operate under the new law.

The past five years has seen this complete about-face on the part of the relationships of government and business. Under the Coolidge administration we had – non-governmental interference in industry, both in words and in action. Under Hoover this had changed to government proclamations of non-interference, together with the reality of increased government participation in private industry (Farm Board, Railroad Credit Corp., Reconstruction Finance Corp., aid to the banks and railroads, etc.). Today, we see the Roosevelt regime proposing to supervise and direct American economy, and in addition, admitting so openly. Such has been the change brought on by the past few years.

How Is the Working Class Affected

It is only in an indirect manner, however, that we are concerned with the inner organization of the capitalist system, – only in the reflections of this organization upon the working class. And the reflection of the above measure can be seen to portray the real image of which when translated into labor reorganization and consolidation, terms means: less workers, increased lay-offs and wage cuts; for, it is only in this manner that the bill is to be interpreted by the working class. The railroad workers are to he the first to receive the gentle medicine of coordination, and they have already begun to feel the full meaning of the government’s labor program, so that even the railroad unions have – true, in their mild manner – begun to raise a voice in protest against this American bearing Greek gifts.

As for those combinations of words seeming to indicate that Roosevelt will introduce the minimum wage, and maximum hours, one cannot but be reminded of the record of the man empowered to enforce the measures. Hidden beneath the sugar coating will be revealed the cruel harshness of the starvation program. The “right of collective bargaining” will be transformed into a company union program. The “minimum wages, maximum hours” will, when translated into reality, become, most likely nothing more than the extension of the “stagger system” to every large factory in the country. It is not the bourgeoisie that will voluntarily surrender part of its profits to better the condition of the working class. The workers will have to organize, to fight many a difficult battle to win these elementary labor demands, the thirty hour week with no reduction in pay.

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