Unconstitutional, because it gave legislative power to the Executive Branch.
The National Industry Recovery Act (NIRA) was passed during the Great Depression as a way to try to get American businesses back onto solid footing. But it was an overreach. It did give employees the right to collective bargaining with employers -- but that was a good thing. The bad thing was how the NIRA pushed and sometimes forced industries to operate in government-sanctioned alliances or cartels. (This was similar to actions that had been taken in Mussolini's fascist Italy.) Antitrust laws were suspended in this process. In effect, this meant the government was encouraging industries to set fixed prices, wages, and production levels. Much of this was enforced by the National Recovery Administration (NRA), created by an executive order from President Roosevelt following the passage of the NIRA. The Blue Eagle symbol was used as the emblem of the NRA. Businesses were to have a Blue Eagle sign in their windows saying, “We Do Our Part.” That was meant to show that each business adhered to the set price and production codes. Citizen committees then engaged in spying on local businesses and report them to authorities if they violated pricing agreements by trying to sell at lower than the set prices.
A Supreme Court case in 1935, A.L.A. Schechter Poultry Corp. v. United States, ultimately decided that the provisions of the NIRA and the actions of the NRA were unconstitutional.
