A common dollar for Canada and the U.S.?
November 17, 2001 4:26 PM   Subscribe

A common dollar for Canada and the U.S.? With the Euro unit of currency slowly coming into common use, it's only natural for other continents/countries to follow suit. How would this affect the national identity of Canada? Is this a sensible thing to do? What are the benefits and deficiencies of such a plan?
posted by ashbury (39 comments total)
Apologies for linking to yet another newspaper article. I feel that this subject will become a common debate in the very near future. As a Canadian myself, I dislike the idea of losing my currency and quite possibly my national identity, however, the idea does make a lot of economic sense...I think.
posted by ashbury at 4:30 PM on November 17, 2001

As an American, I don't like the idea either. I think it would result in a serious erosion of Canadian identity, and could be percieved as yet one more slip into "51st Statehood".

But what to do, economically?

The only compromise that I could see (a completely redesigned US currency with a basic, Euro-style generic design) would never happen.

*sigh* Saddening.
posted by tpoh.org at 4:48 PM on November 17, 2001

As a Euro-bound foreigner I have to disagree. The Canadian economy and political system are much like ours - you know, sort of social-democratic, big government, high taxes, decent welfare - and it would be a big mistake to adopt a currency which depends on a much more capitalistic, laissez-faire and, well, Wild West economy. Currencies should mirror economies. To adopt the U.S. dollar, as shaky South American economies do, might endanger Canada's excellent system and increase its already too high dependence on the U.S.
It might sound absurd but the U.K. joining NAFTA and Canada joining the Euro-zone makes more sense to me. Though of course I'd prefer the UK to come off it and adopt the Euro - and Europe - already!
posted by MiguelCardoso at 4:55 PM on November 17, 2001

Based on what I've read from Canadians, I think most of them would hate the idea.

Heh, that's kind of a misrepresentation, It's not like anyone is saying that the US and canada should 'join forces' and create a "north-americo", but rather Canada unilateraly giving up their own Dollars and just using US$.

Obviously, this wouldn't affect americans at all (other then an over-all strengthing and stablization of the dollar) If canadians want to be like many other countries (either officaly or de facto) and use our money for their bussenes I don't have a problem with it.

As far as the Dollar being more 'laissez-faire' I don't really think that has much effect on the dollar. Intrest rates are still centraly controlled, and as we can clearly see the Canadian $ is not doing very well on it's own.
posted by delmoi at 5:03 PM on November 17, 2001

Confidential to Canada: Resistance is futile. You will be assimilated.
posted by UrbanFigaro at 5:28 PM on November 17, 2001

warz the 37.3 cents goin again? or will Canada just re-adjust the entire payscale and product pricing not to say the services, govt treasury payout. a conversion?(yikes) does G.M. Canada trade with her sister in say Flint using the conversion? same 'hubtropt.#' should cost same-same in Canada as U.S. Yes? I would like to see BIG SAM goldbacks. Also the question of HMQs' Image....a Loonie-BIG SAM dollar Minted from Mexico City Silver...talking coins:"I am from..."Bra-zil". im worth X dollars. (pop-up voice messages......:)
posted by clavdivs at 5:33 PM on November 17, 2001

All your maple are belong to us.
posted by owillis at 5:35 PM on November 17, 2001

I don't know if adopting the "US Dollar" is the right approach. If the North American Dollar were developed and adopted by Mexico, the US, and Canada, that would be more in line with the idea of the Euro. If Canada adopts the USD, more Americans will think of Canada as a suburb of the US and more Canadians will think of the US as the evil empire.
posted by xyzzy at 5:38 PM on November 17, 2001

Does this mean Molson will cost more whenever I head north?
posted by MAYORBOB at 5:46 PM on November 17, 2001

They have their points, but all in all it's just loonie.
posted by crasspastor at 6:19 PM on November 17, 2001

The USD is the worlds "gold standard" so Canada has allready adopted it on a certain level. The problem with full adoption is that whatever woes America will directly woe Canada. Sometimes diversity is good.. for example Russia is booming right now while the rest of the world struggles with recession because it isnt tied into the same systems.
posted by stbalbach at 6:20 PM on November 17, 2001

The reason we (Canada) need our own dollar is that our economy IS NOT in lock step with yours (America) which means we need control of our own dollar to control our own money supply. You'll notice that while sometimes we mirror drops in your interest rate sometimes we don't because while you're economy has been slowing ours hasn't been slowing as much.

So it really boils down to us each needing to control our own economies that while similar aren't the same.

posted by mgoyer at 6:22 PM on November 17, 2001

UrbanFigaro: I realize that you are joking, but it is this sentiment that worries most Canadians. We are concerned about the slow but steady erosion of our country--the so-called Brain-Drain (multi-PhD people heading for the border), the loss of specialty jobs (many nurses head south for the bigger paycheck, for example), and the huge influence the media has (TV, music, CNN). The current lumber war is a yet another example of Americans dominating and setting conditions on Canada.

I realize that it's much more complex than what I've said here, and that the issue of a common currency is at best a touchy subject and at worst an explosive forum for negativety.

To look even farther into the future, what happens when the world develops a "global currency"?
posted by ashbury at 6:27 PM on November 17, 2001

I just hope this means we can get some of that cool multi-colored money here in the US. All we have is drab green. Those festive colors make spending all that much more exciting. (Of course, I rarely use cash anyways, but thats beside the point).
posted by benjh at 6:40 PM on November 17, 2001

Here's a wacky idea:
What if America were to buy Canada?
Hear me out...
It would work as follows; the bill/law/whatever would stipulate that every Canadian citizen (in good legal standing, citizenship from two years before bill proposed...) would receive a quarter million American dollars. America would get all of the natural resources in its new territory and all of the benefits associated with having a bunch of new Americans to tax. The deal would pretty much pay for itself after a few years. Consider the enormous wealth buried under the arctic tundra and factor that with how few Canadians there really are.
If you marketed it well enough (propaganda) it would be a sure-fire winner. You could play on Canadian's existing fears about being assimilated into the US anyway.
I think it is a great idea. Every Canadian would instantly become an upper-middle class American...

Someone please tell me why it wouldn't work.

Note to self: stop drunk-posting...
posted by TiggleTaggleTiger at 7:10 PM on November 17, 2001

Ooh, the whole cost of it to America... would the (current) American voters have to approve an expenditure like that?
Anybody know a lot about the Louisiana Purchase or the Alaska Purchase?
You can all refer to me as TiggleTaggleSeward when we're the biggest country in the world :)
posted by TiggleTaggleTiger at 7:15 PM on November 17, 2001

People have cautioned that this move may further heighten Canada's dependence on the American economy. The article, however, states that 87% of Canada's exports go directly to the U.S., which (I believe) means that Canada is America's foremost trading partner.

This seems to indicate that a vastly co-dependent society in which the economies are strongly tied together already exists. Am I wrong? Should Americans start worrying about Canadian culture infiltrating our nation? (Honestly, we need it. Just for starters: MuchMusic > MTV)
posted by Danelope at 7:32 PM on November 17, 2001

Not from an economic, but from an emotional point of view - I can't understand how people can support universal currencies. We talk a lot here about globalization and homogenization, but isn't a country's currency a big part of their identity? I for sure wouldn't want American money to change, and I would assume people up north would feel that way too. Isn't a universal currency the ultimate in homogenization? Does the economic benefit outweigh the loss of national pride/identity?
posted by owillis at 7:37 PM on November 17, 2001

Just so long as I don't have to tip my waitresses with them little quarters they use up there. (spits)
posted by Hildago at 7:38 PM on November 17, 2001

Cheap is cheap no matter the size of the quarter. (pulls out hankey to clean up shoes) :-)
posted by ashbury at 8:05 PM on November 17, 2001

Does this mean Molson will cost more whenever I head north?
Mayorbob, you obviously haven't been North . Molson beer already costs a lot more in Canada than in the U.S. Much to the chagrin of Cdn beer drinkers
posted by srboisvert at 8:20 PM on November 17, 2001

One reason for us Canadians to adopt the U.S. currency:

It means we could go back to putting one-dollar bills in stripper's g-strings instead of having to use the expensive method of five-dollar bills. That's because, generally, strippers don't like having coins (loonies and twoonies) thrown at them on stage.

Or so I'm told...
posted by Grum at 9:06 PM on November 17, 2001

The main reason, if you think about it, for the creation of the Euro was for something that could compete with the darling dollar. The main reason, if you think about it, for the creation of the European Union was for something that could compete with the US in terms of international politics.

There is no great reason for either the US or Canada to merge into one currency. Aside from the fact that most Canadians go out of their way to seperate themselves from Americans (please, please, argue with me), I have a feeling that Dubya would rather support the Log Cabin Republicans that change the currency of the US.
posted by pooldemon at 9:11 PM on November 17, 2001

We're getting closer to Infinite Jest every day.
posted by jga at 9:12 PM on November 17, 2001

Confidential to America: Resistance is futile. You will be assimilated.

(Note : This is a joke. Or is it...?)
posted by stavrosthewonderchicken at 9:52 PM on November 17, 2001

"The main reason, if you think about it, for the creation of the European Union was for something that could compete with the US in terms of international politics" - pooldemon

Actually, the main reason for the creation of the EU was to tie Germany into an interdependent Europe and so reduce the chances of another European war.
posted by thatwhichfalls at 10:00 PM on November 17, 2001

This is actually just a Canadian instantiation of the dollarization debate, where developing or unstable economies forgo other currency stabilization methods and simply adopt the US dollar as the legal currency of that nation. It's been suggested for several South American countries, as well as Australia and New Zealand recently. Dollarization resources; a map of dollarized economies, as of March 2000 (mostly small island polities and dependencies).

Recently the trend has been echoed in parts of Eastern Europe, with the corresponding term "Euroization".
posted by dhartung at 10:20 PM on November 17, 2001

Molson beer already costs a lot more in Canada than in the U.S. Much to the chagrin of Cdn beer drinkers.

Are you kidding me? Who drinks that shit? Why drink complete macrobrew crap when you could be drinking Upper Canada or Sleeman's or Blanche de Chambly? Answer me that.

As for the dollar debate...I don't really see the problem. The US should just adopt the loonie. Isn't it obvious? (They'll be so excited when they see the little animals on the coins...and the little image of the Queen. Everyone knows the US has been asking for a royal family ever since we burned down their White/Pink House. And wait til they get a load of the twoonie...)
posted by Hildegarde at 11:38 PM on November 17, 2001

Sorry, but as a Quebecois that's exactly why this idea please me: I can't stand to see the queen face all day long anymore. I remember in 9th grade we had an exchange student from Toronto and when our history teacher said something about royalists and us being sick of it, the poor lil thing started crying! It's somewhat revolting to have this perpetual reminder of the expeditious executions and all...
And as assimilation goes, economical it's done, culturally it's done in the anglo side, ain't happening here doh :)
posted by kush at 12:19 AM on November 18, 2001

Where's 'Canada'?
posted by HTuttle at 12:42 AM on November 18, 2001

Hey Pitcairn Island is dollarized, so why not Canada. They're both about the same scale economies.
posted by QrysDonnell at 1:20 AM on November 18, 2001

I think you'd be hard-pressed to find a place in the world which will refuse US dollars as payment for most things. As to C$, well...
posted by clevershark at 1:40 AM on November 18, 2001

Really? I don't think I'd get too far trying to pay for my shopping in Wimbledon town centre with US dollars.
posted by Summer at 6:24 AM on November 18, 2001

who owns more u.s. land then any other country. Can-a-da.(they will own us in 25 years)
posted by clavdivs at 6:59 AM on November 18, 2001

Everyone knows the US has been asking for a royal family ever since we burned down their White/Pink House.

That old Canadian fantasy. You lot were British then, weren't you? Not yet a nation, right? So the Brits burned the White House, not the Canadians.
posted by Mo Nickels at 8:34 AM on November 18, 2001

It might sound absurd but the U.K. joining NAFTA and Canada joining the Euro-zone makes more sense to me.

that's a great idea, miguel. nowadays i think geographic location has less to do than type of economic system when a country chooses to adopt a currency.

adopting a foreign currency who's monetary policy doesn't take into account a country's circumstances ultimately doesn't work. argentina is a case in point where adoption of its dollar peg brought initial stabilization, but is currently proving untenable. they're in danger now of completely trashing their economy. rather than devalue authorities have stated they'd convert to the euro or dollar. shucking off monetary control hardly promotes confidence in your economy. and i think it would unnecessarily distance it from brazil.

i guess unless people have already lost all faith in a currency (russia almost dollarized by default) or the move is from a position of strength (maastricht) to promote greater economic (and political) integration, it doesn't really make sense for a nation to reliquish monetary control. like i don't expect hong kong's peg to last much longer, especially as china moves to float its currency.
posted by kliuless at 8:47 AM on November 18, 2001

Seems like a tempest in a teapot; I just read through that article and saw no opinion anywhere from an American Fed-Reserve member. You would think that if there were any serious consideration of merging currencies - or, in this case, replacing it utterly - the country who issues the mazuma you want to use would have to be involved somewhere along the line.

Considering how intently the Fed works the system, I just couldn't see them tossing a couple of plates up north and letting them go to town. The Euro reflects the interdependence of the economies of the European nations - Canada may be a good neighbor, but our economy is not so tightly tied to theirs. To be heart-wrenchingly frank, the risks to the United States economy would far outweigh the benefits.
posted by Perigee at 9:32 AM on November 18, 2001

Canada may be a good neighbor, but our economy is not so tightly tied to theirs.

Totalling Cdn$249 billion in 1999, US merchandise exports to Canada represent 24% of total US exports. The United States sells more than twice as many goods to Canada, a market of 30 million people, as to Japan, a market of over 125 million people. Canada is a larger market for the US goods than all 15 members of EU combined.

Looks like strong economic ties to me.
posted by Carol Anne at 10:21 AM on November 18, 2001

Note: "a country does not need American permission to dollarize, but it surely helps". TIME.

Dollarization is not the same as a "merged currency". Just as noted above, the dollar is already accepted currency in most of the world, not necessarily at retail. The US investment community will like a country that dollarizes, because that stabilizes their own investment. And that means the US Treasury will probably have little objection.
posted by dhartung at 7:41 PM on November 18, 2001

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