e cases. The
first was stated by Justice Miller in First National Bank _v._
Kentucky:[19] "[National banks are] subject to the laws of the State,
and are governed in their daily course of business far more by the laws
of the State than of the Nation. All their contracts are governed and
construed by State laws. Their acquisition and transfer of property,
their right to collect their debts, and their liability to be sued for
debts, are all based on State law. It is only when the State law
incapacitates the banks from discharging their duties to the government
that it becomes unconstitutional."[20] In Davis _v._ Elmira Savings
Bank,[21] the Court stated the second proposition thus: "National banks
are instrumentalities of the Federal Government, created for a public
purpose, and as such necessarily subject to the paramount authority of
the United States. It follows that an attempt, by a State, to define
their duties or control the conduct of their affairs is absolutely void,
wherever such attempted exercise of authority expressly conflicts with
the laws of the United States, and either frustrates the purpose of the
national legislation or impairs the efficiency of these agencies of the
Federal Government to discharge the duties, for the performance of which
they were created."[22] Instructive, too, is a comparison of two other
decisions. In the first,[23] the Court held that the fact that the Texas
and Pacific Railway Company was a corporation organized under a statute
of the United States did not remove it from the control of the Texas
railroad commission as to business done wholly within the State. In the
second,[24] the Court vetoed the attempt of Maryland to require a post
office employee to cease driving a United States motor truck in the
transportation of mail over a post road until he should obtain a license
by submitting to examination before a State official and paying a fee.
"Of course," said Justice Holmes, "an employee of the United States does
not secure a general immunity from State law while acting in the course
of his employment"; but this time the State went too far.

The extent to which States may go in regulating contractors who furnish
goods or services to the Federal Government is not as clearly
established as is their right to tax such dealers. In 1943, a closely
divided Court sustained the refusal of the Pennsylvania Milk Control
Commission to renew the license of a milk dealer who, in violation of