Markets, Planning and the Moral Economy

Markets, Planning and the Moral Economy

Business Cycles in the Progressive Era and New Deal

Donald R. Stabile and Andrew F. Kozak

Markets, Planning and the Moral Economy examines the rise of the Progressive movement in the United States during the early decades of the 20th century, particularly the trend toward increased government intervention in the market system that culminated in the establishment of President Roosevelt’s New Deal programmes. The authors consult writings from politicians, business leaders, and economists of the time, using a variety of historical perspectives to illuminate the conflicting viewpoints that arose as the country struggled to recover from the worst economic downturn in its history.

Chapter 9: The National Industrial Recovery Act: moral economy perspectives

Donald R. Stabile and Andrew F. Kozak

Subjects: economics and finance, history of economic thought


As we have indicated in earlier chapters, the idea of national economic planning had been around in the US from at least the time of Edward Bellamy. It had been discussed by pundits such as Walter Lippmann and Stuart Chase, hinted at by business cycle economists such as Thorstein Veblen and Wesley C. Mitchell, proposed by the businessman Gerard Swope and used by the federal government’s WIB in World War I. In the depths of the Great Depression national economic planning was clearly on the agenda. To give one example, in 1932 the peak association of business, the US Chamber of Commerce, published an article in its journal, Nation’s Business (‘A panorama of economic planning,’ 1932, pp. 29–32), that surveyed a variety of programmes for national planning from the Swope Plan to Chase’s proposals. The New Deal responded to this call for planning with the NIRA to be administered by a National Recovery Administration (NRA). While we might look backward to Bellamy for the germ of the idea motivating the NRA, the NIRA had more in common with the WIB than with Bellamy’s moral economy. The NRA borrowed its symbol of compliance, the ‘Blue Eagle,’ from a similar symbol used by the WIB and Hugh S. Johnson, who had served for a time as the army’s liaison to the WIB and was head of the NRA. In this chapter we present the interpretations of the NIRA and NRA provided by advocates of the moral economy. First, we give a brief description of the programme.

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