LEGAL AND ECONOMIC ISSUES
Since the National Industrial Recovery Act greatly expanded possible federal intervention in the area of private business activity, it of necessity has led to close scrutiny of Supreme Court decisions defining the constitutional powers of the federal government. Likewise, the pervasive readjustment of economic relationships implied by the Act has given a special degree of interest to the economic theory which underlies it.
The National Recovery Act raises certain legal questions concerning which there exists great difference of opinion. These questions relate mainly (a) to whether the provisions of the Act and of the various codes fall within the legislative powers granted to Congress by the Constitution, and (b) to how far the provisions of the anti-trust laws may be set aside in the administration of the Act.
The only clear constitutional basis for the Act is the clause granting power to Congress to regulate commerce between several states. Federal regulation of purely local or intrastate business could only with difficulty be permitted by the Supreme Court. Since, however, it is true that the operation of almost all local businesses has repercussions upon interstate commerce, there is a plausible view that, in those cases where fed-