1 AUGUST 1987, Page 21

Good as gold

THE Bank of England and the British Museum have pooled their resources in a handsome exhibition, at the Museum, showing how bank notes have evolved over three centuries from the goldsmiths' IOUs. Britannia on the first Bank of England notes is 'a well endowed post-Restoration beauty in flamboyant pose' (say Virginia Hewitt and John Keyworth in their accom- panying book, As Good as Gold). Daniel Maclise's Pre-Raphaelite Saxon princess lasted from 1855 until the 1960s, when her successor, by Reynolds Stone, appears to have escaped from the Disney studios during a remake of Snow White. The explosion of notes and note design came when Pitt took the Bank off the gold standard, and among the suggested new designs was a head of Minerva, by Charles Warren, which he had drawn as a frontis- piece for the Spectator and economically recycled. Country bankers' notes prolifer- ated, and Thomas Bewick engraved grace- ful designs of fruit and flowers for the Bank of Carlisle. The blight came with the Bank Charter Act of 1844, which was to give the Bank the monopoly of the note issue, while securing all the profits of note-issuing for the Treasury. The lesson of this exhibition is that we should repeal the Act, and let a hundred issuing banks bloom, a thousand schools of design contend. Good money, as Hayek argues, would have the chance to drive out bad, and our bank notes could indeed be as good as gold.