1
Introduction
1.1
Outlining
the Issue
In this paper I will try to show that the development of banknote design
and the use of elements in the design can be seen as a result of a number of
influences: the political and economic foundation of the note, technological
developments, the need to make the notes secure and the possibilities for using
the notes to advocate some cause.
The
specific question under discussion could be phrased as:
“How does the banknote document itself and its contemporary society?”
Paul
D. van Wie (1999, v) states that
The act
of creating coinage is manifestly political. It is also manifestly economic. And there are important, inescapable artistic and
propagandistic overtones as well. For when a political entity creates coinage,
it does not simply create blank disks. Coins generally carry a message: words
and numerals, of course, but usually more than that. Political symbols,
slogans, names, and language, all laden with ideology, bias, self-image, and
national identity.
What holds
for coinage does also hold for banknotes. They are not blanks, but filled with
text, numerals and other symbols, laden with explicit or implicit meaning.
1.2
Limiting
the Scope
The first
Norwegian banknote issue was the third in Europe.[1]
The issue was the notes of Jørgen thor Møhlen in 1695.[2]
This means Danish-Norwegian banknotes gives us more than 300 years of banknote
history and notes to analyse.
I
have virtually no access to actual notes, especially older, but the notes of
the national banks and their predecessors have all been described by Rønning (1980) and Skaare (1995). I have used these descriptions as a basis for my
analysis.[3]
When
I refer to the notes themselves, either individual notes or groups of notes, I
will not refer to any source other than identifying the note(s) or note issues.
A list of note issues is given in Appendix
A, where the relevant references to the catalogues are
indicated.
As a
collector of banknotes for 35 years, I have a lot of knowledge from reading
about banknotes and from studying banknotes, either actual banknotes or
pictures of them. A number of observations, generalizations
and statements will draw upon this knowledge and will therefore not be attributed
to any specific source.
I
have chosen to limit my analysis to the visual parts of the note, i.e. elements
easily visible to the user. Symbols intended to communicate something to the
user will certainly be made easily visible. Other elements, e.g. those only
visible under a magnifying glass, against good light or under ultra-violet light
have been excluded from the discussion, as they primarily are intended to enhance
the security of the issue, not to convey any message.
The
analysis is largely limited to the issues of the national bank and its predecessors.
Private banknotes are excluded, except for the Jørgen thor
Møhlen notes, due to their being the first Danish-Norwegian issue. This
delimitation of official notes is, I believe, in accordance with normal
practice in Norwegian numismatics.
1.3
A
Model of Document Analysis
Niels Windfeld Lund (1999) outlines a model of document analysis. As I
understand him, he sees a document as a result of a
documentation process. His model analyses document production and document
reproduction.
In his analysis of document production,
he sees the documentation processes from three different points of view: The
technical/scientific, the social and the humanist perspectives; and he analyses
five aspects: The producer, the field, the medium, the tradition and the
document.
He also presents a model of document
organisation and a model of document reproduction.
I will limit myself to analysing
those elements of banknote production and reproduction that most affects
banknote design, as this is my focal point in this paper.
2
Analysis
2.1
The
Function of Banknotes
In Lund’s
model (1999, 35) reproduction of a document includes how it is
used. The function of banknotes, as a monetary instrument circulating in
society, is thus a reproduction of banknotes. In his model of document
reproduction, the user and the document takes the place of the producer and the
field in his model of document production.
The
idea or philosophy of money, however, belongs in the analysis of document production,
as the existence of such an idea is a fundamental pre-requisite for any production
of money, in any form.
Money
in the form of coins has a history going back to the 7th century b.c. (Johansen 2001, 89). Coins, until recently, had value due to their
content of precious metals, preferably gold or silver. Coins were produced by
mints controlled by the government, who guaranteed their value in terms of
metal content.
Historically,
banknotes were not money but representations of money, in the sense that they would on demand be exchanged for money, i.e. coins, or that
public offices would accept them on par with money for payments.
Paper
money has no intrinsic value; the value has to be rooted in trust. Trust that
the money I accept will be accepted as payment by others; and trust that the
value will keep over time. If paper money does not achieve trust, it will be
exchanged for coin as soon as possible or used for payment, while coins are
hoarded. In both cases paper money will cease to function as money, it will
loose value compared to coinage or will be redeemed for coin to such an extent
that the issuer will be bankrupt.
In
Denmark-Norway, the first note issues contained text that explicitly or
implicitly (through references to Royal decrees) stated that they should be accepted
as money. Later issues promised that the notes would on demand be exchanged for
silver coin, after the creation of the Scandinavian coin union for gold coin (for
exact wording of promises, see the actual text in Rønning 1980, Skaare 1995). In Denmark this practice
ended in 1962, in Norway in 1945. After this, the notes have been fiduciary
notes, i.e. their value rests upon trust in the issuing authority.
Money,
as seen from a social point of view, has two primary functions that are of
interest: As a medium of exchange and as a store of wealth. This makes it
important that money a) actually can be exchanged for goods or services; and b)
that the value of money is stable over time.
Economic
theory tells us that the supply of money has to expand as the economy grows (see
Glahe 1973, 122–173). This is very difficult to ensure, if the
whole supply of money is based upon precious metals. The issuing of banknotes
was therefore advocated as a means of ensuring an adequate supply of money and
credit. Banknotes also had the advantages of being easier to transport, and
wear and tear did not cause any actual loss of precious metals, as was the case
with coins. Inadequate supplies of silver led Sweden to mint copper as giant
coins (plåtmynt),
weighing up to 19.710 kg (Tonkin 2002, 64) – a paper substitute was welcomed for purely
practical purposes.
Coins
in precious metals also have a strong tendency to be hoarded in times of
unrest, causing problems for commerce and government.
2.2
The
Early Major Design Elements
The early banknotes had major design
elements that today are minor design elements. Below, I will try to describe
their development and to explain why they were important design elements in
earlier times.
One should bear in mind that
the choice of design elements is the producers’ way of inducing the users to
accept paper documents as money; contrary to the
existing ideas of money meaning coined gold and silver, and contrary to the
marked difference in intrinsic value between coins and paper.
Design, as it appears on the
banknote, is a part of the technological perspective of the banknote
production. The reasoning behind design, and the effects of design, belongs to
both the social and humanist perspective of production and reproduction.
2.2.1
Text
All notes within the scope of this
paper contain textual elements. The early notes are very like other official or
legal documents of the 17th century, containing mainly text and signatures
(see Illustration 1 and Illustration 2, p. 25 and Illustration 3, p. 26).
Table 1 clearly shows a trend, starting with long texts on
the 17th and 18th century issues, getting shorter during
the 19th century while post-war notes are virtually without text – the
only texts relevant to the notes’ function being the name of the issuer and the
denomination.
Modern notes are full of
micro-text, as this is a security feature not meant to be read, but to be seen
as lines or other parts of the design (i.e. seen without a magnifying glass), I have not included them in my concept of text in this discussion.
This development is explained below as a natural consequence of the
banknote being a part of; and interacting with, two major document complexes: a
legal document complex surrounding every banknote issue; and a complex of
monetary documents existing at the time the banknote was first issued.
Table 1 Text length of banknote issues[4]
2.2.2
Signatures
All regular Norwegian banknotes are
signed by one or more persons representing the issuer or issuing authorities.
This practise was both a security feature, ensuring that the notes were
authentic; and a guarantee that the promises of the note be held by the issures.
Until 1901, all notes were
signed by hand; from then on signatures have been printed on the notes. As a general rule, signatures, like (and together with)
serial number and year, have been printed in black on the front of the note.
Table 2
Signatures on Norwegian banknotes” shows the development of banknote signatures. The thor Møhlen issue had three signatures on the note itself,
and the same three on the counterfoil. According to the instructions regarding
the signing of the notes, the person signing last should make a scroll on his
signature so that it crossed over from the note to the counterfoil (Rønning 1980, 23).
Later issues had between one
and six signatures, earlier notes tending to have more signatures than later
ones, and high denomination notes having more than low denomination notes. It
is easy to see that the number of notes made signing them hard work, and a
number of persons had this as an occupation. High denomination notes, being
relatively few, could have many signatures, while the much higher number of
small denomination notes did not rate this costly treatment.
From series II (the first
issue with printed signatures) to series III, including the small change notes
and the London issues, notes had only one signature. This was generally the
head cashier of Norges Bank, but the vice chairman of
the board of Norges Bank signed the London issues.
From series IV on, the head
cashier and the head of the central bank (chairman of
the board of directors) have signed the notes together. This return to a larger
number of signatures could be seen as a return to older practices, now without
an extra cost.
In series VII, the signatures
are placed on the back of the notes and they are printed as an integral part of
the design, no longer in a separate printing like the year and serial number.
This would indicate that signatures no longer have a real function, but are
retained as a traditional part of the design only.
Table 2 Signatures on Norwegian banknotes.
Numbers indicate number of note issues.
2.2.3
The
Banknote Legal Document Complex
One of the concepts of Lund’s model
for analysing documents is the document complex (Lund 1999, 34). A document rarely stands on
its own; it is usually one of a number of interconnected documents. One
can often construct a number of such complexes for a given document, depending
on what aspects of the document one wants to look at.
One such complex of documents
that, in my opinion, is important for banknote design is the documents
surrounding the banknote in its early days, making its function possible. It
should be quite self-evident that giving out paper instead of coins in payment
would be met with resistance, and that such an act would have to be preceded by
legislation and information. [5]
The foundation of the thor Møhlen issue lies in a royal decree of June 22nd
1695, in which the King authorises the use of certain notes in parts of Norway.[6] The decree also (among other things) makes use of other types of notes
illegal, and threatens penalties against those refusing to accept the notes as
payment. On July 10th 1695, Rentekammeret[7] issued detailed instruction regarding the design of the notes - how the
signatures should be make, that one third be torn off as a counterfoil, the
placing of the royal portrait, numbering, denominations etc. On August 10th,
information about the notes was sent to various government offices in the area
the notes were intended for, together with an unnumbered note without
denomination, in order that they inform the populace about the notes and how
they were to be used. The project ended with a royal decree
of August 21st 1696 about the recalling of the thor
Møhlen issue.
These documents defined the thor Møhlen issue, with regards to how it should be used and
how it should be designed. It also defined the design in that the whole text of
the note is referring back to the first royal decree as an argument for the
note’s existence and use.
The authorised notes
1713–1728 similarly refers to a complex of documents that the notes are a part of. A royal decree of April 8th 1713 authorises
the issuing of notes, and contains detailed specifications about their design
and use.[8] It also specifies penalties for non-acceptance of such notes. A number
of decrees were issued later, regarding design changes and withdrawal of
certain notes, to be exchanged for new issues. A new decree about punishment
for non-acceptance and regulation of other practises of June 27th
1714 makes it clear that acceptance was not universal. A placard issued by the
chief of police in Copenhagen (in 5000 copies) points in the same direction.
This issue, as the thor
Møhlen issue, has as its major design element a text, pointing at the royal
decree authorising the use of the notes and defining their design, as shown in Illustration 1 p. 25.
Later issues refer to the
bylaws of the issuing bank, or to the duty to redeem notes for silver or gold.
While not explicit, as the documents referred to are rarely directly identified
on the note, this is still references to other documents in the legal document
complex surrounding and including the banknotes.
The change from daler to
kroner is in itself an indirect reference to the Scandinavian currency union
and to the law of currency of April 17th 1875 (Skaare 1995, 1:245) which introduced the new currency and
authorised the issue of certain denominations in coins and banknotes.
Except for the gold
redemption clause on series II notes, 20th century notes have been
free from references to other documents in the legal document complex of the
banknote. There is one notable exception to this. Until the recent issues,
signatures on 20th century notes have been followed by the title of
the signer. On the London issues, however, we find no title but the sentence ifølge særskilt fullmakt, “by special authority”.
2.2.4
The
Precursory Document Complex
Another reason for the textual design of early banknotes
is the fact that the idea of banknotes was not created in a vacuum, but as a
development of an existing complex of monetary document types.
The thor Møhlen
issue was, among other things, meant to replace the practice of issuing notes
(IOUs, obligations) instead of paying out cash to workers at the copper mines
of Røros (Rønning 1980, pp 22-23).
Among the forerunners of the notes of
the Bank of England were the receipts given in exchange for deposits of cash,
and promissory notes (Hewitt and Keyworth 1987, 9-10, 24-25).
The models for the first notes of the
Stockholm Banco (kreditivsedlar)
are a bit unclear, kopparsedlar being
used as an argument but this is debatable (Platbārzdis 1960, 37-38; Lindgren 1968, 11).[9] The later issues of transportsedlar have a likeness with
cheques (Platbārzdis 1960, 78-79), and ran to 4 pages, as they – in principle –
had to be endorsed every time they changed hands (op.cit.,
ill. 81a-d).
This adoption of traditions of
predecessors made the early banknotes typical legal documents, incorporating
text and signatures (and seals) as the major design elements. This is clearly
shown in Illustration 1 p. 25 and Illustration 3 p. 26.
These traditions live on until today in
Great Britain, where banknotes still “promise to pay”, and flourished until
about 1836 in Sweden, when the last multi-page banknotes were issued (Lindgren 1968, ill. 61a-b).
Another predecessor of the banknotes is
coinage. Banknotes were representations of coins, and it is not surprising that
they also inherited some of the traditions of the coinage. Most early banknotes
either had the royal monogram printed on them or embossed on them. The designs
of the embossments, and their circular form, are strikingly similar to the
design of contemporary coinage (for drawings of embossments, see Rønning 1980, 146–148). The printed monograms also bear close resemblance
to monograms on coins. The thor Møhlen issue is a
special case, with the royal portrait (again, similar to a coin) in a lacquer
seal on the notes. This practice of coin-like embossments and royal monograms
continued on Danish-Norwegian and Norwegian notes until – at least – the first
notes of Norges Bank in 1817.
Around 1840 the banknotes seem to be an
accepted fact of life in Norway, and the possibility of exchanging notes for
silver – a long-standing, but un-kept promise – was instated 1842 (Skaare 1978, 57). At the same time, the combination of need to protect
against forgery and development in engraving and printing technology made design
that was more advanced both desirable and possible. From the two-coloured notes
(i.e. notes printed in two colours, a coloured background print and a black
vignette, from 1841) onwards we see a shift in design towards a new tradition,
based in the needs and functions of the banknote itself – freed from the
traditions of legal documents and coinage. Royal monograms have disappeared, so
have embossments. The only break with this is the prominent part of the
monogram of King Haakon 7th on the notes issued in London during the
war (cf. Illustration 5 p. 27).
The representative function still made
text, promising exchange for silver (later gold), necessary;
but now – when the promise could be realized – it was downplayed. This promise
of exchange, making banknotes representatives of “real” money, was retained long
past its reality. It disappeared from Norwegian banknotes with series III in
1945, but the duty to exchange notes for gold had been suspended 1914–1928 and
from 1931 onwards (Skaare 1978, 61). The near absence of text in modern Norwegian
notes reflect their status as fiduciary money, i.e. money which value is rooted
in trust only.
The disappearance of text,
monograms and embossments made space for other design elements. As this
development of banknote design made its start in the 1840’s, this coincided
with the advent of nationalism as a strong movement in Norwegian mental life.
This, as we shall see in part 2.4 “The
Use of Banknotes to Further Ideas of Nationalism” (p. 11), made a deep impression on Norwegian banknote
design.
2.3
Printing
Technology and Design[10]
In theory, a banknote does not need more than a
statement of denomination and, possibly, the name of the issuer, to function as
money. Such a design would, however, be very easy to
forge.
Forged notes have two effects that one
would want to protect against. The producer of genuine
notes would have to redeem more note than was issued; and the trust in the
genuine notes would disappear if forged notes circulated in some quantity.
The history of banknote design can be
seen as a continuing process or battle between actors in a banknote technology
complex: The legitimate banknote producers, i.e. national banks or banknote printing
companies on the one side, and criminals on the other side. This complex can
also be seen as a document complex in which banknotes are a part, as I understand
Lund (1999).
The security elements in banknote design
are chosen so that the note contains a complex of techniques needing
specialised competence and machinery to produce genuine notes, while the costs
of producing notes still have to be kept under control. Another important security
element is quality control, to ensure that all genuine notes have identical
look and feel. If one lets low quality notes out, it will make it easier to
circulate counterfeit notes.
The security features of early notes
were few. They were printed like books, set with loose types. Embossings (i.e.
raised symbols made by pressing a stamp against the paper) that easily became
smudged and incomprehensible when notes circulated, was one security feature.
That the paper was watermarked was probably the best security element. A
weakness in early notes were that denominations were hand-written, not printed.
This made alterations possible. Rønning (1980, 55) shows how this influenced the first notes of Kurantbanken.
Almost 10,000 daler more was redeemed than had been issued,
most of this because denominations had been altered. Only of the
smallest denominations did one redeem forged notes.
Vignettes were introduced to make
forgeries more difficult. One also printed penalty clauses on the notes,
stating that forging them would be punishable by death and that reporting
forgers to the government would lead to monetary reward. This still did not
deter everyone from forging money. Strangely, this inefficiency in preventing
forgeries has not made such warnings disappear. There are
numerous modern banknotes from other countries where such warnings as “La loi punit le contrefacteur”
have their place even today. The copyright symbol on the notes of series
VII may be seen as a modern version of this sign of legal protection.
As printing techniques then meant that
new printing plates had to be made constantly due to wear, one had to keep the
design simple enough that one could make new plates that were identical to the
old ones.
In the early 19th century a
number of techniques were invented, that would transform the design of
banknotes. One was to engrave in soft steel, which then would be hardened. This
made longer print runs possible before engravings had to be worked over or
replaced be new. One also developed the technique of transferring gravures from
hardened steel to soft steel that then was hardened again, so that one could
make a number of identical printing plates, ensuring uniformity and quality of
printed notes. Another invention was a lathe that could make and engrave
complicated geometrical patterns called guilloches,
patterns that it was impossible to make or engrave by hand.
Freed from the constraints of the older
techniques, banknotes now could be filled with colours, ornaments and pictures,
making them pleasing to the eye. This attractiveness must, however, be seen as a result of artistic solutions to the problem of preventing
forgery, not as the primary goal to be attained.
While forgeries had been a major problem
with early issues, the new techniques made counterfeiting a major venture where
a number of competent tradesmen had to be involved, and demanding a large
initial investment.
As new advances in printing technology
made new security features available or made forgeries of circulating notes
easier, the issuing banks issued new series of notes. When photographic
reproduction became a possibility, notes were filled with elements like micro
lettering, making correct reproduction impossible. Today’s colour photocopiers
has necessitated the use of intaglio prints that shows special symbols when
viewed at an angle, metallic holographic elements that cannot be photocopied,
lettering on metallic threads in the paper where the text only can show up
under strong backlight and so on. There are also elements that are only visible
under special light. The watermark is a technique that has survived from the
first days of the banknote. On a modern banknote, everything is filled with
print except – possibly – the area where you find the watermark.
Most modern notes are the result of
three different printing principles: The background is often printed in offset;
major pictorial ornaments are printed in intaglio printing while serial
numbers, years and signatures are printed in letterpress printing. The high
cost of engraving for intaglio printing makes it too costly for printing the
whole note. Engraving, which was a common technique for illustrations, has
almost disappeared from other kinds of documents than paper money, stamps and
other documents where security demands such techniques.
2.4
The
Use of Banknotes to Further Ideas of Nationalism
When text gave way to other design elements,
these elements had other functions than merely furthering the function of the
note, or being neutral decorations. Semiotics tells us that there is no such
thing as a neutral design element.
Semiotics is the science of signs (Fiske1990, 39-60). There are a number of models of the sign,
among them the models of Peirce and of Saussure.[11] What they have in common, is that they see the sign as interplay
between a physical object and a mental image or idea. The physical sign derives
its meaning from the mental sign it evokes in the reader of the sign.
Fiske (1990, 85-92) describes Roland Barthes theory of the two
orders of signification. The first order is the denotation of the sign, i.e.
the everyday, common sense or lexical meaning of the sign. The second order of
signification is described as three ways the sign can work. These are
connotation, myth and symbol. Connotation is the interaction between the sign
and the emotions, values or ideas of the reader, when the reader of the sign
becomes just as important in defining the meaning of the sign as the sign
itself. Myth is an interrelated set of ideas or concepts surrounding some
aspect of life or society. A symbol is an object that through convention has
become a sign of something else. All these aspects of signs are important in seeing
how banknotes in varying degree are expounding nationalism or other ideas.
These ideas also imply that there may be
a difference between the conscious intention of the active user, or maker, of a
sign, and what implications we, as readers of the sign, can draw from it. In
the following, I will describe how I decode the use of signs on banknotes; this
does not necessarily imply intention on the part of the note designers.
Benedict Anderson shows how nations are
constructed as imagined communities. According to Anderson (1991, 170-185), maps and museums are important factors in
this construction. Maps show how the nation is physically delimited and, when
e.g. hung in classrooms, give the pupils a mental picture of their nation.
Likewise, museums show what historical facts and stories are important in defining
the nation. Anderson is writing about emerging nations in what today is termed
the Third World; nations that had been constructed by colonial powers by
drawing lines on a map, regardless of linguistic, economic, religious or
ethnical boundaries or connections. Norway as a geographical term and as a defined
political and national entity goes back to the early Middle
Ages, and is not an artificial construct like many of the nations Anderson
(1991) writes about. Still, Norway has been subservient to Denmark, later Sweden,
for centuries, and has only relatively recently become an
independent nation. The constitution of 1814 made an impact on the
status and political autonomy of Norway; this has been a major influence on the
design of Norwegian banknotes in the 19th and 20th
century.
Maps, as Anderson sees them (ibid.,
170-178), are used to make the geographical definition of the nation stand out
from the rest of the surrounding world, and to define what geographical
entities constitutes the nation; thereby imposing a mental map of the nation on
the spectator. In museums one collects and displays artefacts, thereby
constructing myths, that defines the nation in terms of its history. I will
regard banknotes as a kind of travelling maps or museums, circulating in the
populace and exposing them to the same symbols and myths as maps and museums
do. Banknotes do tell a story, and in the case of Norway, much of the story is
about a nation struggling to define itself in terms of its history.
Another point about banknotes is that
they – at least until modern times – were inherently national. While coins
could circulate well outside the area reigned over by the monarch issuing them
as long as their metal content was as promised, banknotes were backed by
legislation and trust and could not function outside their defined area. Not
until coins lost their intrinsic value, and banknotes could be exported, did
banknotes become an international commodity. The higher denomination banknotes
of Norway (500 and 1000 kroner notes) could not be legally exported until 1982
(e-mail from Bank of Norway, 12.11.02).
2.4.1
The
Norwegian Coat of Arms
The Norwegian coat of arm, a lion standing hold
an axe, is an old symbol for Norway, and was first used on coins about 1285 AD
(Skaare 1995, 1:78). It was also used on coins during the Danish
rule, but was not used on banknotes of the same era.
2.4.2
The
Use of National Symbols before the Kroner Notes
On the notes from the era of Danish rule, we
generally find a royal portrait or monogram in an embossed
stamp or printed on the note. In the days of absolute monarchs, the
state was the area ruled over by the monarch, so using personal symbols of the
monarch would be natural.
With the first notes of Norges Bank came
the use of the Norwegian coat of arms, symbolising the nation of Norway. This
can both be seen as a new tradition, marking the near-independent status of
Norway, and as a natural consequence of the fact that the king was not any
longer an absolute monarch.
Later issues also incorporate symbols of
major industries or trades in Norway; this exhibition of national
characteristics conveys a myth (in Barthes’ sense) about Norway and defines Norway
in terms of its modern economic life.
2.4.3
The
Use of National Symbols on the Kroner Issues
2.4.3.1
Series
I
The first series may seem quite
self-contradictory in its use of symbols. A major element is a portrait
of the king, Oscar II, in a Swedish admiral’s uniform (see Illustration 4, p. 26). This is a break with the tradition of having no
royal symbols on the banknotes of Norges Bank. There is no record (Stixrud 1995, 1:39-40) of why this portrait was chosen for the
notes. He is, however, not portrayed as a monarch, he
wears no crown and no title is given, in contrast with contemporary coinage
where his status as king is clearly communicated. And
it must be argued that however much he was king of Sweden, he was also king of
Norway.
Another main symbol on the notes is the
Norwegian coat of arms, a clear indication of Norway as a semi-independent
nation. Yet another set of symbols are the coats of arms of the six bishoprics.
Through them, the note displays how Norway is made up of parts. It should be
noted that these symbols e.g. does not advocate historical claims like claims
to the Norwegian dependencies lost in 1814. To the modern mind, this might seem
quite natural, but both coats of arms and mottos have historically been used to
proclaim dynastic or territorial interests beyond contemporary reality. E.g.,
the title “de
goters och venders” [King of Goths and Wends][12], proclaiming sovereignty over possessions in Germany, was a part of the
title of Swedish kings until 1872, long after the territories in question had
been lost. One should bear in mind that the territorial claims of Norway in
Greenland was not forgotten at the time, Norway occupied parts of Greenland in
the 1930’s and used the historical connection as an argument in the Haag international
court.
2.4.3.2
Series
II
The second series, on the other hand, points in
a nationalist direction only. It was first issued in a period of rising
opposition to Swedish rule, and after an era where national romanticism had had
its heydays. The ornamentation of the notes is clearly marked by references to
ornamentation and symbols from Norway’s Middle Ages. The one person portrayed
on all notes has clear connections to the Norwegian striving for independence
in 1814, while the naval hero depicted on three of the notes was a person
mythologized and romanticised for his derring-do, fighting against the Swedes.
Admittedly, he was serving in the Danish navy, but he was clearly seen as an
example of Norwegian courage and seamanship.
The larger denominations (from 50 kroner
and up) of this issue have historical buildings on the back, together with the
Norwegian coat of arms surrounded by the arms of the bishoprics. Three of the
four buildings are major buildings from the era of Norwegian independence
before Danish rule. Two are castles – one of them built to defend Norway
against the Swedes – and the third is a cathedral devoted to the patron saint
of Norway, worshipped throughout Scandinavia. The fourth building is the mansion
at Eidsvold, where the constitution was worked out in 1814. Seen together, the
notes show us a country looking back to its days of glory to define its
history, showing defiance to its dominating neighbour and union partner. In
their bringing together of defining symbols and conveying the myth of Norway,
they closely resemble the museums described by Anderson (1991, 178-185).
2.4.3.3
The
London Issues
The London issues, with their use of the king’s
monogram as a major design element in addition to the Norwegian coat of arms,
does also break the tradition of not using the king’s person or signs of the
king on the banknotes of Norges Bank. During the war, the king became a very
important symbol for the Norwegians, and he was seen as an important unifying
element at a time when party politics had been discredited. His monogram was a
well-known symbol, and had been used on coins for decades. In preparing for a
situation that could be chaotic, it was natural one should exploit the king’s
standing for an issue of banknotes. It is also telling that in doing so, one
defines Norway as a nation loyal to its king – thereby excluding collaborators
and, possibly, communists who by definition should be anti-monarchists.
2.4.3.4
Series
III
Perhaps the most striking feature of the notes
of series III, if one excludes their almost majestic austerity and lack of
artistic design, is that they actually were chosen for
the monetary reform in competition with the colourful London issue (see Illustration 5, p. 27 and Illustration 6, p. 28). The only nationalistic symbol on these notes is the
Norwegian coat of arms.
The choosing of this issue, instead of
the London issue, may be telling a tale of political considerations. One thing
is the royal monogram on the London issues, possibly excluding the communists.
The communists had become a large political force in Norway and had done great
services in the underground movement, and one should also
remember that the Red Army recently had liberated parts of Northern Norway, at
the cost of many Soviet lives. Choosing the locally designed and produced issue
also paid homage to those who risked their lives to design and produce them,
and hence, in an indirect way, to all those who had been part of the
underground resistance.
The design of these notes also documents
their pre-history. They had to be designed and produced in secrecy, so that
neither the Germans nor the populace got wind of what Norges Bank had planned.
If the Germans discovered what was happening, an ill fate awaited those
responsible. And if the populace found out of the
plans, the whole work would be in vain. Therefore, the notes had to be made
with what little expertise and other resources were available in Norges Bank,
involving as few persons as possible and without access to outside resources
that normally would have participated in both design and engraving.
2.4.3.5
Series
IV
The history of the notes of series IV is long,
starting in 1922 (Stixrud 1995, 1:68) and ending with last notes being issued in
1976 and finally being demonetised and made valueless in 1999. The history of
the design of this issue is told and well illustrated in Stixrud (1995, 1:68-126; 2: ills. 50-71).
Nationalism is still a major part of the
design, no more directed against a common enemy but more trying to instil a
sense of community and common values, telling a myth of a united people
striving together to build the nation. The adverse (portrait side) shows famous
Norwegians (i.e. famous in Norway, internationally neither Michelsen nor Wergeland would be household names). Many of them were also
important in defining Norway or the Norwegian, both to Norwegians and to
foreigners. The reverse shows scenes from Norwegian daily life, with each note
representing a trade or industry: fisheries, trade and shipping, farming,
forestry, mining and industry, and finally arts or intellectual work. In this
way, the notes make a mental picture of Norway and its daily life, with people
struggling together to make a living and to make a community. Monuments and
castles are markedly absent, Norway is no more exhibiting a glorious but
distant history; today’s exhibition is looking forward, at a united country
building the future. An idyllic picture, but one that is
congruent with the post-war political and social climate of co-operation and
inclusion.
2.4.3.6
Series
V and VI
In series V, the nationalism is more downplayed
than in earlier issues. While series II and IV had a discernible nationalistic
programme, the programme of series V seems more to be an exhibition of this and
that that could represent Norway, a kind of tourist brochure telling of famous
Norwegians and nice things to see while in Norway. We have
the same persons as in series IV, less Michelsen, but the reverses are a series
of pictures without any internal connection: fisheries and shipping on the 10
kroner note, Borgund stave church on the 50 kroner note, the Constitutional
assembly at Eidsvold on the 100 kroner note, the University of Oslo on the 500
kroner note and a coastal scene with a lighthouse on the 1000 kroner note.
In series VI, all persons have been
changed. Save for Grieg on the 500 kroner note, we
find persons that were only vaguely known to most Norwegians. The reverses all
shows works of artisans. While the Norwegian coat of
arms is prominently displayed on the notes of series V, it has disappeared in
series VI.
Increasingly, the notes seem to have
lost their function of furthering nationalism and building a nation. The
community building function of creating and displaying a common knowledge of
Norway’s culture is retained, however.
2.4.3.7
Series
VII
Series VII continues the traditions of series V
and VI, in that nationalism as such is no longer a theme, but the display and
communicating of Norwegian culture is continuing.
A new feature in this series is that the
whole note is centred on the person depicted, in that all design elements are
connected to this person. Interesting, too, is the fact that for the first time
a majority of persons depicted may be equally, if not more, well-known
internationally than in Norway.
2.4.3.8
The
Euro
While Norway is not yet a member of the
European Union, the idea of using the Euro as currency in Norway has been advocated.
There is also a possibility that Norway some day will convert to Euro as a
possible future member of the EU.
While Norway’s banknotes have been
nationalistic in their design, the design of the Euro was intentionally
a-nationalistic. No country should find their symbols on the notes; France
should not have a denomination greater or smaller than Germany. Their design is
dominated by architecture on the adverse and bridges on the reverse. No actual
building or bridge is featured; this is “generic” illustrations without any
national overtone. A map of Europe, which – in contrast to the coins – also
includes nations that are not members, the flag of the Union and the stars used
in the flags are the only symbols showing the origins of the notes.
As “circulating museums”, (cf. the first
part of 2.4) these banknotes must constitute problems. How can
they instil a sense of common history and experience in the users, when the
notes shows nothing that can be identified and thereby evoke feelings? The maps
can possibly help make a mental map of the union, but as such, it is incorrect
in that it also shows non-members. The a-nationalistic design of course
overcomes dangers that would be inherent in choosing identifiable objects or
persons to exhibit, but this also curbs the notes in their nation-building
capacities.
2.5
Denomination
The denominations have varied
considerably through the ages. As various issues have been denominated in
different currencies – all named daler,
but with differing actual values in silver coin – I will not compare the
denominations of the different issues.
Until about 1750,
denominations generally were handwritten in the text of the note, and numerals
were not used until about 1750. From then on, the denomination was printed in
text and numerals. This has implications regarding the users of banknotes. In a
country where most of the population were analphabets,
textual documents could only function well in the classes who could read and
write, i.e. the middle and upper classes. The choice of denominations also
indicates that these classes were the intended users. Later developments,
necessitating increasingly lower denominations, also brought forth numerical
indications of denomination, making it easier for analphabets
to use banknotes.
Denominations varied with the
state of the government finances. In hard times, banknotes were issued for
small amounts, in better times only notes denominated with a value of at least 1 daler were issued.
The kroner notes were first
issued as 5, 10, 50, 100, 500 and 1000 kroner notes. This series of
denominations has been surprisingly stable; the 5 and 10 kroner notes were
abolished in 1963 and 1984 respectively, while the 200 kroner note was introduced
in 1994.[13]
This stability is not matched
by a corresponding stability in the value of the kroner. The purchasing power
has dwindled to a mere 2 per cent of the original value since the kroner were
introduced in 1875. This means that the 5 kroner note had a purchasing power of
about 250 kroner today. At the same time, the real value of wages, or the
purchasing power of labour, has increased strongly. 5 kroner represented two
and a half day’s labour for a skilled labourer of 1875 (Statistics Norway. n.d.). The 1000 kroner note represented a purchasing power
of 50 000 kroner today, and was equal to about two years’ pay in 1875.
The mismatch between the
development of the denominations of notes and the purchasing power of the
kroner will be further discussed in the following.
2.6
The
Competition with Other Forms of Money
There are numerous types of money,
banknotes are just one of them, and a type we know well from our own
experience. In reality there are, and have been, a number of document complexes
competing for the role of money in society.
2.6.1
Coinage
At the start of the era of
banknotes, gold and silver (and to some extent copper) minted as standard coins
with a denomination close to their intrinsic worth, were the only universally
accepted money in Denmark-Norway.
As discussed in part 2.1 “The
Function of Banknotes” this kind of money had some weaknesses that
banknotes could overcome. However, banknotes were obviously seen as a poor
substitute for real money by the populace. The number of royal decrees
threatening punishment for non-acceptance and otherwise enforcing the use of
banknotes shows this.
Gresham’s law (cited in Scott 1930, 26) says that poor money will drive good money out
of circulation. This means – in our context – that given the choice between paying
out gold or silver coin on the one hand, and banknotes on the other hand, you
will always give away the banknotes (as long as you perceive them to be
inferior in value) and keep the coins. The effect of introducing banknotes will
be that coins disappear from circulation – not because banknotes are seen as
better, but because they are deemed inferior.
Banknotes were normally
issued as notes that could be exchanged for gold or silver coin on demand.
Normally, legislation would put limits on the total outstanding issue, either
as an absolute sum or as a sum or factor over the issuing bank’s actual holding
of gold or silver.
If too many banknotes were
issued, holders would come to the bank and demand coins in return. If enough
did this, the bank could not meet its obligations and redemption would have to
be suspended – reducing the credibility of the bank and its issues even
further. The issuers thus had ample reason to strive for parity between their
notes and coinage.
While these mechanisms
holding the note issues within limits obviously had their function protecting
the economy against strong inflation, they also had their drawbacks. This was
fully demonstrated in Norway during the 1920’s and 1930’s, when Norges Bank
followed a monetary policy aiming at restoring redemption of notes for gold at
the rate stipulated in 1875. This policy led to deflation and an economic
crisis, which took years to overcome. Norwegian notes have been irredeemable,
fiduciary notes since 1931 (despite their own wording until 1945) and this has
been efficient. In reality, the competition between gold and silver coins on
the one hand, and banknotes on the other hand, was over when Norway stopped
minting silver circulation coins in 1920. For all practical purposes, coins
without actual intrinsic value cannot compete with banknotes – at least not for
payment of larger sums.
2.6.2
Documentary
Payment Forms and Bank Accounts
As shown in 2.2.4 “The
Precursory Document Complex”, banknotes had other documents as predecessors.
These documents – drafts, bills of exchange, obligations, cheques etc. – lived
on, parallel to banknotes. They had proved useful in effecting transactions
between merchants, and have lived on until this day. They were, though, not
general instruments of payment, so they could only partially compete with banknotes.
With the advent of a
well-functioning banking system, some of these instruments – like the cheque –
gained strength. New monetary instruments, directly competing with banknotes
and coinage, also saw the light of day. The most important such instrument was
the bank (or savings) account.
Hoarding money, be it coin or
banknotes, had been the only way of storing monetary wealth. In a society where
there were few institutions of credit, you had to save money to invest in e.g.
a farm, a house or a fishing boat. Hiding away cash was one of the important
ways of saving. (A more productive way was to buy a part of a farm.) When the
first savings banks were started, one of the reasons was to give savers a safe
place to put their money, safe from fire and theft – and even accruing
interest. Gradually, such accounts came to take a major place as a store of
wealth, in direct competition with coins and banknotes.
A further development came
with the increasingly more effective services of account-to-account transfers.
This made it possible to settle debts over long distances and without actually
involving cash. Folio accounts increasingly took over many monetary functions.
With the introduction of
electronic data processing for keeping accounts in the Norwegian banking system,
one had the resources to process a large amount of cheques. In the 1960’ and
1970’s the old practice of paying out salaries in cash gave way to transfers
from the bank accounts of employers to the checking accounts of employees, and
checks became the preferred method of payment for medium sized and large
amounts.
2.6.3
Plastic
Money
A development of bank accounts are
“plastic money” or “electronic money”, money substitutes (competitors) based on
a bank account (or a similar device).
“Plastic money” got its name from the plastic cards associated with them.
These stem both from the credit cards that were invented in the US in the
1950’s, and from the check guarantee card used by Norwegian banks to facilitate
use of checks in the 1960’s and 1970’s. These cards were developed into cards
that could be used to get cash from an ATM (Automated Teller Machine or Cash
Dispenser), later to pay at an EFTPOS terminal[14] in a shop.
These instruments were
developed to take the place of checks, that had proven very costly, and to
minimize the need for cash handling in shops and banks. The effect is that with
a small card you can have full control of you bank account, without ever visiting
your bank and with the use of very small amounts of cash.
“Electronic money” are
solutions that makes it possible for you to effect payments and other
transactions electronically, e.g. through your bank’s internet banking solution.
For the banks, the point is
that as long as they can make you keep your money in your account, it can be
lent to others. At the same time, they want to avoid the costly and risky
handling of cash amounts, and they transfer the manual work with money transfer
from themselves to their customers.
Cash, both as coins and as
banknotes, have been relegated to a secondary place in a modern society’s
payment and wealth storing systems.
2.6.4
The
Unofficial Economy
While the amount of actual cash in
circulation has had a slow decline over the last 10 years, measured as a
percentage of GDP or household income, the last two years has seen a decline in
the actual amount circulating. It is still an astonishing 40 billion kroner or
about 8000 kroner per capita (Norges Bank 2002, 33-34). Most of us will reflect that this amount is
very much larger than we usually have lying around.
Anyone with a practical
banking experience will know that a number of people, especially elderly, have
deep-rooted suspicions against banks and will prefer to hoard their wealth in
the form of cash.[15] This often comes to light when they are robbed, or when unsuspecting
heirs come across large amounts when tidying up – or upholstering old
furniture, redecorating rooms or otherwise.
Another class of customer are
those who fear taxes more than death, preferring to keep cash in bank vaults
instead of in interest bearing accounts.
The major explanation of the
large amounts of cash in circulation is probably crime. Not the petty wealth
tax avoidance described over, but large-scale tax avoidance
and smuggling and distribution of heavily taxed or illegal substances –
alcohol, drugs, and narcotics (Norges Bank 2002, 33).
In order to make the
transport and hiding of large sums impracticable, Norges Bank does not want to
make notes of larger denominations than 1000 kroner. As shown in 2.5 “Denomination” the decline in value of the kroner since 1875 would
have made making larger notes reasonable, but the growth of other means of
payment for legitimate trade makes banknotes a means of payment for minor sums
outside the black-market economy. Other countries have abolished their larger
denominations, e.g. Sweden the 10,000 kroner note, USA the notes of 10,000,
5,000, 1,000 and 500 dollars, UK notes over 50 pounds etc. It is also a point
that the fight against white-washing makes it a goal
to make most transactions traceable, which they will be when handled as account-to-account
transfers or by other electronic means of payment. In this respect, banknotes
have become impractical documents for the authorities.[16]
2.6.5
Overall
Picture
Banknotes won the competition
against coinage to become a preferred means of payment during the first half of
the 20th century. In the same period, banknotes have been fighting a
losing battle against other forms of money for storing wealth.
Developments in banking, made
possible by extended use of information technology, has over the last few decades
brought forth new forms of money, leaving little room for banknotes in the
legitimate economy.
The fight against the
black-market economy has also curbed what would have been a natural development
of the banknote institution.
3
Conclusion
Tradition is
one of the aspects in Lund’s model for document production (1999, 30). But can we talk of a
tradition of banknote design? The techniques used for production have changed
over years, the role of banknotes and their function has changed, and so has
their appearance. The monetary ideas behind banknotes have also changed.
I
believe it is wrong to demand total stability from a tradition. Yes, banknote
design has changed markedly in the 300 years they have been with us, but so has
their times. The hallmark of a tradition must be that things change in response
to changed circumstances, in order to preserve the functioning of the central
theme of the tradition – in this case the banknotes. Traditions that are not
adaptive will cease to exist. So far, banknotes have shown a remarkable degree
of adaptation to changed circumstances.
I
will conclude that there is a tradition of banknote design, and that this
tradition has changed as external influences have made it necessary. Major
external influences have been introductory problems with acceptance,
inflationary practices, forgery, printing technology, ideological changes,
economical changes, the unofficial economy and changes in the concept of money.
Given
the development of banknotes as presented in this paper, one could pose the
question: “Is there a future for banknotes?”
Banknotes
have gone from representatives of real money to everyday and trivial instruments
of payment. Their design has become increasingly complex in order for them to
be trusted. They have met serious competition from other monetary instruments. Technological
change, not in the design and production of banknotes but in the making of
other kinds of money, e.g. electronic money, will be the major obstacle for
banknotes. Norway probably will develop technologies that will make banknotes
superfluous for most of today’s users. Tourists, who will have difficulties in
integrating themselves with an electronic monetary infrastructure, will
probably be the last legitimate users of banknotes. The unofficial economy will
still need cash; this is one of the major reasons for abolishing banknotes.
Given the historical development shown in the preceding, one could
prognosticate that Norway should abolish banknotes sometime between 2010 and
2020.
Money
will then be electronic and traceable, and will be transported or controlled by
plastic cards like those we know today. They are designed as billboards,
marketing national and international private financial institutions. They, like
the Euro, will lose the function of “travelling museum” and will not create
communities like those that today’s banknotes do. This will be a loss in our
everyday life.
