The state bank tax of ten per cent, upon the notes issued by all state banks and private bankers is the method by which the national government preserves the country from unrestrained note issues.1 Our political institutions, even when at their worst, fit us so easily that we rarely stop to consider how narrow is the barrier which separates us from the condition of "wild-cat" banking.2 There are many constitutions which prevent a ner's Jackson, p. 363. Later instances of this sort could be easily found, but the same result is often obtained through the election of judges. The whole chapter is a fruitful lesson for all lawyers. A case contra to the one above is Linn v. State Bank, 1 Scam. 87. where the state court was right. Briscoe v. Bank has been affirmed in Woodruff v. Trapnall, 10 How. 205; Dar-rington v. Bank of Alabama, 13 How. 12; Curran v. Arkansas, 15 How. 317. It has been overthrown in Veazie Bank v. Fenno, 8 Wall. 533, by holding that the national government can tax the power out of existence.

6 Veazie Bank v. Fenno, 8 WalL 533, holding that such a tax was not a direct tax, but an excise tax by a charter remains conditional until the requirements of the act are fully carried out.2 Where a banking corporation is attempted to be formed under a general law, it is often said that the requirements of the law must be strictly followed. But this is only relatively true. It will apppear that objections of this character, as a general rule, can be urged only in favor of the state in a direct proceeding to attack the incorporation.3 The statutes require a name for the corporation and forbid the use of the same name by two corporations,4 and a bank whose name is infringed may have the remedy of injunction. The location of the bank must be specified, and it would seem to have been held that one state cannot charter a banking company for the purpose of doing business in another state;5 and when located in one county a bank cannot establish a branch of itself in another county without authority from its charter.6 An extreme case that worked a great injustice, and cannot be approved, will be found in the note.7 In the absence of express statutory authority the corporation cannot begin business, except as a de facto corporation, until the whole capital stock is subscribed,8 but sometimes the statute permits it.9 The statute governs as to how the capital stock shall be paid, whether in money or otherwise.10 If the statute is silent on the sub-

1 Statute of Feb. 8, 1875, oh. 36. sees. 19-21; 18 Stat at Large, 811.

2 One of the curious legacies of the days of vicious banks of issue is the idea that the issuance of notes is a source of profit to the banker. This idea really lies at the bottom of the jealousy which exists among a certain class against national banks. So far is it from being a source of profit that many national banks do not keep their notes in circulation. There is a school of continental economists who think that unrestricted private banking is a good thing - that it regulates itself. See the translation of an article of Adolph Wagner found in 1 Encyc. Pol. Science, 239. It is lamentable to see that this idea has some following among bankers, and that a secretary of the treasury has actually proposed to allow banks to issue notes of hand against their assets. The folly of this proposition is that such issues cannot be successfully supervised. A failing bank would always resort to note issues to prevent bankruptcy. The ignorance of legal conditions involved in the suggestion is appalling. But in this country we have seen the effects of such a system, and it is not likely to be revived. See 29 Am. Law Rev. 94, 459. Whenever there has been any talk of reviving it, "Terruit gentes, grave ne rediret Seculum."

The effects of such a system are likely to prove incalculably disasstate bank from issuing notes, or which provide for security; but there are many states wherein there is no provision of law that would prevent a private banker3 from flooding the country with worthless currency in the form of unsecured notes. Until such a provision exists in every part of the United States, it is not too much to say, even in a legal treatise, that an advocate of the repeal of the state bank tax is a public enemy.

Sec. 18. Delegation Of Power

The national legislature has delegated to the different territorial legislatures the power to incorporate banks.1 In practice, the duty of passing upon due incorporation, both under the national bank act and under state and territorial legislation, is usually delegated to ministerial officers.2 No good reason can be urged why jurisdiction ought not to be given to certain courts to pass upon the question of the propriety of the articles of incorporation and the regularity of the steps taken.