The Bank of England recently proposed a consultation period for the introduction of banknotes made out of plastic, rather than paper. I am well aware that many countries have already discarded their rather nasty, crumpled, grubby, germ-ridden notes made of paper – Canada and Australia come to mind, but these are Johnny-come-lately countries, and “why should we follow them?” I hear people say.
Scare-mongerers point out that if you fold a plastic note and put it in your back pocket it will unfold, and may spring out and fall to the ground. (I mean, what person with any sense keeps notes folded in a back pocket? A fool and his money deserve to be parted….)
The fact is: we hate change and will always grumble when change is forced upon us. But just think what a major thing it must have been when banknotes started to be introduced in comparatively low denomination notes in the 1790’s, when people had previously always dealt with gold, silver and copper and where the coin’s intrinsic value was the same as its face value. I mean: “I promise to pay…. ” signed by the Director of the Bank of England is not the same as having the value in your hand, is it?
The Bank of England’s own website (which includes the image of the One pound note dated 1805 shown at the start of this blog) gives the history:
“In 1759, gold shortages caused by the Seven Years War forced the Bank to issue a £10 note for the first time. The first £5 notes followed in 1793 at the start of the war against Revolutionary France. This remained the lowest denomination until 1797, when a series of runs on the Bank, caused by the uncertainty of the war, drained its bullion reserve to the point where it was forced to stop paying out gold for its notes. Instead, it issued £1 and £2 notes. The Restriction Period, as it was known, lasted until 1821 after which gold sovereigns took the place of the £1 and £2 notes. The Restriction Period prompted the Irish playwright and MP, Richard Brinsley Sheridan, to refer angrily to the Bank as “… an elderly lady in the City”. This was quickly changed by cartoonist, James Gillray, to the Old Lady of Threadneedle Street, a name that has stuck ever since.”
Ancestor Richard Hall was well aware of the risk of counterfeit notes – as in this entry in his Journal. Even at this early stage, the paper itself was hard to replicate, and the water mark gave forgers all sorts of problems. But I suspect that in the minds of the general public the problem with the notes was inextricably linked to the war with France – it was those darned Frenchies who were causing the problems. The Bank of England refer to Gillray so I looked out one of his caricatures, dating from March 1797. It appears courtesy of the National Portrait Gallery and is entitled “Bank-notes, – paper-money, – French-alarmists, – o, the devil, the devil! – ah! poor John Bull!!!” and features William Pitt, standing behind the counter, handing out wads of money while Sheridan, Fox and Lord Stanhope discuss whether accepting paper in lieu of gold is a good idea.
“Don’t take his notes. Nobody takes notes. They don’t even take my notes any more.”
The John Bull character replies:
“I wool take it. A may as well let my Master Billy hold the gold to keep away you Frenchmen, as save it to give it to you, when ye come over, with your damned invasion”.
Fox urges John Bull to decline the notes, with the words “Don’t take his damned paper John, insist upon having gold, to make your peace with the French when they come”
I like the way that both sides claimed “patriotism” as the reason why paper should or should not be accepted. Poor John Bull indeed!
Gillray also showed Pitt in the guise of Midas, spewing forth paper money while clothed in gold. The padlock dangling from his neck reads ‘Power of Securing Public Credit’ and in his hand ‘The Key to Prosperity’. Pitt may have a body of gold, but he defecates mostly paper onto the Bank of England, below. The caption underneath explains that Apollo had fixed asses ears to the head of Midas – and although these are half-hidden by a crown, figures lurking amongst the undergrowth on the left are whispering “Midas has Ears” – i.e. he is an ass.
Nowadays we would have to show George Osborne,the Chancellor, jointly with Mark Carney as Governor of the Bank of England, converting the national wealth into….plastic!