Governments brushed these ideas aside until they fell over their feet

We should all be in the banknote business. It’s a licence to print money. The Bank of England made £1,618 million out of it last year, and paid every penny of this over to the Treasury, as required by Sir Robert Peel’s Bank Charter Act of 1844. Senior figures in the Bank have long believed that this inequitable Act is due for amendment. Friedrich Hayek, as was his wont, had a better idea. He thought that the Bank should give up its monopoly. A banknote is only a promise to pay, and (so he argued) anyone who wanted to issue promises should be allowed to do so. We would then be free to decide whose promises we trusted. Monopolies were always open to abuse, not least in the hands of the state and its agents. After all, the more money they printed, the more they would make. Competition was needed to keep the note-issuers up to the mark.