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One fault of method is very serious for the scientist. While there are thousands of references to authorities in the footnotes, there are hundreds of statements in the text for which a reader would gladly have a citation of authority but finds none, statements, if true, of deep significance, statements which tax credulity. Statements of this kind even purport to be quoted verbatim (574). It is a common practice to give many references at the beginning of a discussion, even many quite definite references to particular pages, and then give nothing more. For twenty pages (607627) the origin and provisions of the British Trade Boards Act of 1909 are discussed without a single reference.
Even for the reader braced for the dismal science there is too much massing of fragmentary data and altogether too little attempt to organize the data or to indicate the typical or the specially significant. Many, many pages indeed are filled with data which have no appreciable significance for the author's study. There are 34 pages of exposition and analysis of the Italian census of 1901, ending in the judgment that none of the data are worth much (93-127). Many scores of pages are given to tracing the remotest beginnings of labor legislation, comparing futile suggestions, summarizing debates, and contrasting forgotten proposals. Near a score of different proposals in France alone are compared and criticized point by point.
But let us have an end of these adverse criticisms. They might be continued indefinitely and into even more serious relations. The author's translations pass beyond the reasonable limits of freedom and looseness into real inaccuracies. His statements as to the provisions of laws are sometimes quite erroneous, as, e. g., the Minnesota law (549) and to a less extent other American acts. Such criticisms are never pleasant to make; and certainly they are not pleasant to make against a book into which have been put so noble a spirit and so vast an amount of industry. In particular it is not pleasant, nor is it altogether comfortable, to pass unfavorably upon a book which comes with a warm commendation from Professor Loria, an Italian book at that. Only
because it behooves any man who stands in any way against Professor Loria to make the ground very solid under his feet have I felt justified in making my criticism as specific and as long as it is.
For no purpose, unless indeed for the very determined Italian reformer's local uses, can this large work displace Meny's smaller one, especially in the latter's newer edition, Le travail à domicile. Ses misères, ses remèdes.
WILLARD C. FISHER.
NOTES AND MEMORANDA
DEPOSIT GUARANTY IN MISSISSIPPI
It may seem a far cry from the boll weevil to deposit guaranty. But remembering the relation of the chinch bugs in the Missouri Valley to the free silver movement of the nineties, one realizes that an insect may be a cause of financial legislation proposed or enacted. For several years, in Mississippi south of the 33d parallel, the cotton crop had been almost destroyed by the boll weevil. In a typical county, Pike, the normal crop of 25,000 bales fell to 3,600 bales in 1913. In other sections of the state the crop was injured by the army worm, and in the Delta section by overflows from the Mississippi River. At the same time the state banks were running without supervision. The statutes were not entirely lacking in banking provisions, and some of the provisions were in themselves very good, but there was no bank examination and no verification of reports. "In a word," says a Mississippi legislator, "Mississippi state banks were simply chartered by the state and turned loose to do business just as they would."
It was inevitable that many banks should fail. There is no official list of the failures, but a list privately compiled showed 22 bank failures in 1912 and 1913 and 7 more early in 1914. The deposits were not ascertained in all cases; so far as known, they amounted to $4,600,000. The number of banks reporting to the state auditor fell from 342 in June, 1911, to 306 in June, 1914. National banks increased in number from 31 to 37. There was an attempt in the legislature of 1912 to enact a banking law. It failed largely because the Senate and House could not agree on the method of selecting the bank examiners. A majority of the Senate
wished the examiners to be appointed, while the House wanted them elected by popular vote.
By 1914, it was evident that something must be done. There was a bank failure just as the legislature met, and failures occurred all through the session. Not satisfied now with a bill for safeguards and supervision, many legislators insisted from the start on the guaranty of bank deposits. The Mississippi Bankers Association, with much the same arguments that had been used before the legislatures of other states,1 opposed the guaranty sections to the end. It is possible that if the members of the Association had foreseen the ultimate adoption of deposit guaranty, they could have made participation optional with the banks, and could have provided for appointive, instead of elective, bank examiners. After a long struggle a bill was finally passed in March and was signed by the governor March 9th.
More striking even than the deposit guaranty plan is that of electing the three bank examiners. It is not quite without precedent, for in some states bank supervision is committed to an elective officer, -the state treasurer, state auditor, or secretary of state. The need of technical qualifications in a bank examiner is self-evident, and therefore only those citizens may become candidates who have passed an examination to determine their fitness. Examinations are given by a Board of Bank Commissioners, composed of a successful banker and business man appointed by the Governor, an experienced lawyer appointed by the Attorney General, and an experienced accountant appointed by the State Auditor. Examinations will be held in March, preceding the general election in November; special examinations will be given at other times on payment of a $50.00 fee. Applicants will be examined in accounting, theory and practice of banking and the banking laws of Mississippi, and the federal banking law. Every applicant who makes a grade of 75 per cent, is of good moral character, a practical accountant, and has never been the manager of a banking or other business enterprise which
1 Quarterly Journal of Economics, vol. xxiv, pp. 85, 327, reprinted in Sen. Doc. no. 649, 61st Cong., 3d Session, Appendix B.
has failed or liquidated below par during his management, will receive a license to become a candidate for state bank examiner. The license is good for four years. One examiner is to be elected from each of the three supreme court districts. As no general election would occur soon after the passage of the new law, it was provided that the applicant from each district who made the highest grade in the first examination should be a bank examiner until January, 1916. It is reported that the examination was a good one, and as well calculated as an examination could be to test the knowledge of would-be bank examiners. In one of the questions it was asked what a cashier should do if a prospective borrower, on being asked for security, offered to obtain the endorsement of a solvent oil mill company. Almost all of the applicants are said to have favored discounting the note so endorsed. They were apparently unaware that an accommodation endorsement is beyond the powers of a corporation.
There is no head to the Mississippi bank department. All the bank examiners are of equal authority. The three examiners constitute a board, it is true, and there is a chairman, but his special authority is of the slightest. On the request of the board of directors of any bank for a special examination, he must designate one of the examiners to make such examination. In addition to the regular quarterly meetings of the board of bank examiners the chairman may call other meetings if he deems additional meetings necessary. In these two matters only has he authority beyond his colleagues. Apparently the office of the department will usually be in charge of the board's secretary. The examiners are examiners in fact. They go into the field and themselves inspect the banks. For this they receive $3,000 per annum each and their expenses for railroad fare, livery hire and hotel bills. Incidentals are not allowed. The examiners even have to pay part of the compensation of any assistants who may be necessary. Subject to a limit of $150 per month each, assistant examiners will receive $10.00 per day, of which one-fourth must be paid by the three elected bank examiners personally. The experiment of running a state bank depart