◆ Why were progressives so eager to see the government enter the business of hydroelectric power in the 1920s?
THE NEW DEAL 687 were flaunting many of its provisions. That fall, Roosevelt pressured Johnson to resign and established a new board of directors to oversee the NRA. Then, in 1935, the Supreme Court intervened. In 1935, a case came before the Court involving alleged NRA code violations by the Schechter brothers, who operated a wholesale poultry business confined to Brooklyn, New York. The Court ruled unanimously that the Schechters were not engaged in interstate commerce (and thus not subject to federal regulation) and, further, that Congress had unconstitutionally delegated legisla- tive power to the president to draft the NRA codes. The justices struck down the legislation establishing the agency. Roosevelt denounced the justices for their “horse- and-buggy” interpretation of the interstate commerce clause. He was rightly concerned, for the reasoning in the Schechter case threatened many other New Deal pro- grams as well. But the Court’s destruction of the NRA itself gave the New Deal a convenient excuse for ending a failed experiment. Regional Planning The AAA and the NRA largely reflected the beliefs of New Dealers who favored economic planning but wanted pri- vate interests (farmers or business leaders) to dominate the planning process. Other reformers believed that the government itself should be the chief planning agent in the economy.Their most conspicuous success, and one of the most celebrated accomplishments of the New Deal, was an unprecedented experiment in regional planning: the Tennessee Valley Authority (TVA). The TVA had its roots in a political controversy of the 1920s. Progressive reformers had agitated for years for public development of the nation’s water resources as a source of cheap electric power. In particular, they had urged completion of a great dam at Muscle Shoals on the Tennessee River in Alabama—a dam begun during World War I but left unfinished when the war ended. But opposi- tion from the utility companies had been too powerful to overcome. In 1932, however, one of the great utility empires—that of the electricity magnate Samuel Insull—collapsed spec- tacularly, amid widely publicized exposés of corruption. Hostility to the utilities soon grew so intense that the companies were no longer able to block the public power movement. The result in May 1933 was the Tennessee Valley Authority. The TVA was authorized to complete the dam at Muscle Shoals and build others in the region, and to generate and sell electricity from them to the public at reasonable rates. It was also intended to be an agent for a comprehensive redevelopment of the entire region: for stopping the disastrous fl ooding that had plagued the Tennessee Valley for centuries, for encouraging the devel- opment of local industries, for supervising a substantial TVA program of reforestation, and for helping farmers improve productivity.
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