The Cotton Textile Institute (CTI) played a key role in implementing the New Deal in North Carolina. CTI, a national organization of textile manufacturers, was headquartered in Charlotte and included prominent North Carolina industrialists such as Charles Cannon and Ben Gossett.
CTI was formed in response to a crisis in the textile industry. During the 1920s, cotton overproduction drove down textile prices and reduced profits. Between 1919 and 1926, the net income of all textile mills tumbled from a $212,000,000 surplus to a $43,000,000 deficit. In 1926, a group of textile manufacturers met at Manhattan’s Biltmore Hotel and established the Cotton Textile Institute. CTI sought to increase cooperation among textile factories in order to reduce cutthroat competition. Walker D. Hines was the first full-time president of CTI. He was ably assisted by secretary George A. Sloan and counsel Goldthwaite Dorr.
CTI enjoyed some success during the 1920s. Two-thirds of all textile manufacturers joined the association, including major corporations like North Carolina’s Cannon Mills. But the Great Depression threatened to undo this progress. The value of the nation’s cotton crop fell by more than $40 million between 1929 and 1932. At first, CTI tried to solve the problem through voluntary cutbacks. The association convinced 80% of manufacturers to reduce their working hours and output. Such cooperation, however, threatened to violate federal anti-trust laws. Therefore CTI decided to work with rather than against the Roosevelt administration.
Other groups, similar to CTI—among them the National Association of Manufacturers, the Chamber of Commerce, and the National Coal Association—also sought to work with Roosevelt. The result of this collaboration was the National Industrial Recovery Act (NIRA) of 1933. NIRA allowed trade associations like CTI to regulate themselves, as long as they obeyed certain federal regulations. CTI eagerly accepted this law—particularly because they themselves wrote most of the regulations. CTI representatives created the Code of Fair Competition for the cotton industry. The Textile Code Authority, which enforced the regulations, was stacked with CTI members, as was the Textile Labor Relations Board. NIRA was less a government program and more a cooperation between government and private industry.
If anything, CTI had the upper hand in this relationship. Its strength was made clear during a 1934 strike instigated by the Textile Workers Union. When President Roosevelt tried to intervene in favor of the strikers, CTI rejected his interference. The strike broke soon after. CTI’s power had been preserved.
Anthony J. Badger, North Carolina and the New Deal (Raleigh, 1981); Louis P. Galambos, “The Cotton-Textile Institute and the Government: A Case Study in Interacting Value Systems,” The Business History Review, Vol. 38, No. 2 (Summer, 1964); Jacquelyn Down Hall, Robert Korstad, and James Leloudid, “Cotton Mill People: Work, Community, and Protest in the Textile South, 1880-1940,” The American Historical Review, Vol. 91, No. 2 (April, 1986); William S. Powell, North Carolina Through Four Centuries (Chapel Hill, 1989); Milton Ready, The Tar Heel State: A History of North Carolina (Columbia, 2005); Time, August 2, 1926; July 29, 1929; May 22, 1933; September 3, 1934; September 24, 1934; Timothy W. Vanderbug, Cannon Mills: A Case Study in Southern Industrialization, PhD dissertation, Mississippi State University, 2001.