The times dispatch. [volume] (Richmond, Va.) 1903-1914, 1908-03-19
THURSDAY. MARCH 10, 1905.
SOVEREIGN STATES AS TRADING
CORPORATIONS.

Some questions in government. life
and religion are eternal. knowledge
may increase and methods of life may
widely alter, but the old problems will
recur in newer form. The recurrent
problem of America Is the relationship
between the States and the govern
ment, and no amount of legislation or
experience will eliminate this problem
entirely. We are led to refer to this
question again by reason of the com
ments which the Lynchburg News and
the Danvilla Register have made upon
an article recently appearing in The
Dispatch. This article depiored
the action of the Governor of South
Carolina in ordering his subordinates
TO disobey the injunction issued BY
Judge Pritchard, of the Federal court.
The Times-Dispatch said that such dis
obedience interfered with the orderly
administration of Justice, and added a
further comment that we rejoiced that
Governor Swanson had not been led
into the same spectacular appeal to
in1Ud1ClOuS pTdlse tHal ,sHai dNsSi 'S'N''
Goyerno- Glenn's refusal to obey the
Federal injunction in the rata cases.
To both the Lynchburg News and the
Danville Register these opinions of The
Times-Dispatch seemed unwarrantably
Federalistic. The News especially pours
out her flowing periods on the SOW
ereisnty of states and the horrors of
Federal interference. With all this
The Times-Dispatch is in hearty ac-
cord as an academic problem. No paper
believes more earnestly and has taught
more consistently the need of protect
ing States rights than The Times
Dispatch, and, so far as the theory is
concerned. this paper is in full SYM
patty with its Danvilie and Lynchburs
critics; but those estimable contempt
raries are baying along trail that
has lain cold these seventy years.
When the Constitution was adopted
the States were in their own opinion
sovereign entities, but when Chief JUS
tee Marshall finished his construction
of that incompatible instrument, the
states found themselves subordinate
parts OF q unified whole. We may be-
moan this fact we may prefer the
earlier days-look back with longing
eyes TO sovereignty that has gone;
but neither our lamentations nor our
retrospectlons will restore the vanished
past.
The best hopa which this country has
TO prevent fprtbsr. extension of Federal
power IS to elect to the White House
and TO the Capitol President and
Congress who believe in Democratic
principles of local self government; for
when once this country falls under the
domination of a political party that be-
lieves in Capitalization, the spasmodic
objections of the individual States be-
core of no avail. So far as the South
Carolina case is concerned there APP
pears TO be good sense as well as an
unbroken series OF decisions In sup
fort of the position which the Federal
courts nave taken. Briefly, the law Is
this: that when Il state goes into trade
1T dpdINOI.S iko iibHN5 c.AiN ~ CSdAiN tf
las aytsoyereign government. and put;
itself voluntarily under the same rules
and regulations as those which contro
THE conduct OF individual citizens
A notable case in point is the Bani
iof the United States VS.. the Planters
Bank of Georgia, which was decided b,
fChief Justice MARSHALL In 1924 Tn
facts of the case were that a suit wa
. brought on some OF the notes issue
jby the Planters Bank of the State Q
Georgia IN a United States Circui
Court, 10 which the Georgia bank plea
that, as the State OF Georgia was a
incorporation, 1t was party defendan
and as such was free from suit in
United States court under the elevent
amendment of the Constitution. I
which Chief Justice Marshall replied
II is, we think, sound principle tht
when government becomes a partn,
in any trading company, 1t divests /,
self, so Tar as concerns the transaction
Of that company. of its sovereign char
scter, and takes that of a private cit
gen. Instead of communicating TO ii
I
satiyes, it descends to level wit
those with whom 1t associates itsel
and takes the character which belong
to Its associates and 10 the bushes
which is to be transacted"
A case of very much the same cha
setter came to the United States s,
p,eme Court in 1863 resulting from Il
failure of the Bank OF Arkansas viii,
had been chartered by the state
Arkansas. and Of which tho State w
the sole incorporation and stoekhold,
In delivering the opinion OF t
court. Justice Curtis said;
.That State, by becoming interest
with Others in banking corporate
pr by owning all the capital stock do
q not impnrt to that corporation any
Its privileges or prerogatiyes, that
lays down its sovereignty, so far as /
3pscts tho transactions OF the corpo,