posted
The Euro has caused considerable problems for some European countries, including at least one or two recessions. The benefits are arguably worth it, but they're less economic and more political -- very situational.
Also, the requirements for entering the Eurozone are more stringent than could be met by Mexico, I believe. Also, European countries in the Eurozone have more homogenous economic policies than the US, Canada, and Mexico do.
I don't think it would be a disaster, but neither is there any real reason to (can anyone name one?), and there would be negative effects, in the short term and the long term.
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fugu: Do you suppose that both Canada and Mexico will not continue to grow economically in the next 50 years? Combining currencies at the very least strenghthens ties to both countries and that will be useful as we do more business with both. Oil is becoming a huge commodity in Cananda and we are already starting to outsource alot of our production to Mexico.
With Europe combining it's strength and everyone giving the kow tow (proper pin yin = ke tou) treatment to China and to a lesser extent India, strenghthening alliances is a good idea. Or rather remaining aloof while everyone else strenghthens alliances is not a good idea.
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Sure, they'll grow economically. So? So will South Korea, Brazil (well, most likely), and lots of other places, near and far. I see no reason to combine our currency with any of them.
As far as "Strengthens ties to both countries", I don't see how that's much of an argument; there are far more generally beneficial (and simpler, and less costly) things we could do if that was our aim. As far as "useful as we do more business with both", I think that's wrong. There are no significant currency-related barriers to trade with either country, that I'm aware of. The financial institutions that allow currency-independent commerce among the three states are well-established and efficient.
There are even reasons to believe a unified currency would be significantly detrimental to at least one member at some point, most likely Mexico. They're at a stage of development where flexibility in monetary policy is quite useful, and good monetary policy decisions for them would frequently be bad monetary policy decisions for us (if made for our currency, not if made for their currency). Tying our currency to theirs means there would only be one monetary policy.
As for the oil and outsourcing, so? That activity is unconnected with a unified currency.
Btw, how familiar are you with Bretton Woods?
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The proportionality agreement was stupid (for both sides, IMO), but his proposed replacement rule would be even worse. If those're the only two feasible political options, Canada chose right.
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I don't think he means a 25-year supply of refined products, though I do agree that returning to that rule would be a pretty drastic shift from the status quo.
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I suspect we'd be buying more than the proportionality agreement's percentage anyways, but Canadian exporters would have a better bargaining position if it were removed.
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Likely, because we don't have the infrastructure in place to supply Eastern Canada from Western Canada... and also because as we learned from the National Energy Program crisis under Trudeau, Western Canada is happy to "Let the Eastern bastards freeze in the dark." Posts: 10886 | Registered: Feb 2000
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I don't like straw man, either, but there are points that needed to be made and now have been.
I'd have been just as happy if the anti-immigration person hadn't been "the Republican." Many Republicans are pro-immigration. The free-market economists are among them.
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quote:Originally posted by twinky: Likely, because we don't have the infrastructure in place to supply Eastern Canada from Western Canada...
Right, but pretty soon the Northwest passage will be open due to global warming, so you can ship it by tanker instead. Plus, winters will be milder so they won't need as much. It's a win/win!
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Fugu: I am alittle familiar with the system he created that was adopted post WW2.
Twinky: I never said it was new, but it IS an expanding industry as science gets close and closer to being able to effectively extract oil from tar sand.
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No he, the Bretton Woods system is named after a place (in New Hampshire), and it is the system I'm referring to (just calling it "Bretton Woods" is fairly common).
It involved an attempt to unify exchange rates (within a very small amount of variance). It worked okay for a little while (largely due to the US committing to huge cash outflows that were perhaps not the wisest course), and then disintegrated due to the strain doing so put on economies. And that was with a gold standard, theoretically simplifying things.
edit: and not just a gold standard, but a huge gold inflow from the all the countries that owed us tons (literally, in gold) of money. Which was most of the rest of the western world at the time.
quote:Originally posted by twinky: Likely, because we don't have the infrastructure in place to supply Eastern Canada from Western Canada...
Right, but pretty soon the Northwest passage will be open due to global warming, so you can ship it by tanker instead. Plus, winters will be milder so they won't need as much. It's a win/win!
It's probably good you don't have the infrastructure in place anyway. If you did, it'd probably be just like the pipeline in Alaksa. I've read several articles in the last few years that have said if the permafrost ever melted in Alaska, the pipeline would become, at least temporarily, inoperable. I haven't read if they ever overhauled it or not, but Canadian permafrost, much like Alaska's will be melting soon, despite what Alaska's Senator Ted Stevens said, we aren't about to enter a 900 year cooling period. Half the pipeline is built above ground, elevated to keep the heat from the oil away from the ground so it won't melt. If it does melt, the ground will subside and the pipeline will crack. Imagine how bad that could be over 400 miles or so of pipeline.
It'd be funny if Canada's government complained that they should have control of the Northwest Passage because other countries might pollute their shores if there is an oil spill, and then they go and start shoving it through the Passage as fast as they could, but even if it were the case, it's their passage, they can do what they want.
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quote:No he, the Bretton Woods system is named after a place (in New Hampshire), and it is the system I'm referring to (just calling it "Bretton Woods" is fairly common).
Ah, thanks for the correction.
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quote:Originally posted by Qaz: I don't like straw man, either, but there are points that needed to be made and now have been.
I'd have been just as happy if the anti-immigration person hadn't been "the Republican." Many Republicans are pro-immigration. The free-market economists are among them.
I believe that a significant number of free-market economists are no longer interested in being associated with the Republican Party. The free-marketers, often characterized by the Chicago school, are more libertarian (little ell) than anything else. They were politically aligned with the Republicans back in Regan’s era, but Bush’s economics aren’t what I’d generally call free-market, and his social policies don’t exactly bring much admiration from those who prize liberty. Since I’ve been following it, I’ve noticed a significant shift of economists away from blankly defining themselves as Republican.
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