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Conservative Caucus Chairman [[Howard Phillips]], [[WorldNetDaily|WND]] columnist and author [[Jerome Corsi]], activist [[Phyllis Schlafly]], among others, have formed a coalition against the amero.<ref>{{citeweb| url=http://www.canadafreepress.com/2006/cover121406.htm |title=Debut of the Amero, |author=Judi McLeod |publisher=Canada Free Press |date=2006-12-14}}</ref> On [[January 22]], [[2007]], Republican Representatives [[Virgil Goode]] of Virginia, [[Tom Tancredo]] of Colorado, [[Walter Jones]] of North Carolina, and [[Ron Paul]] of Texas were among the 43 federal lawmakers who introduced H. CON. RES. 40, a resolution that expressed: <blockquote>"The sense of Congress that the United States should not engage in the construction of a [[North American Free Trade Agreement (NAFTA) Superhighway System]] or enter into a North American Union (NAU) with Mexico or Canada."</blockquote>
Conservative Caucus Chairman [[Howard Phillips]], [[WorldNetDaily|WND]] columnist and author [[Jerome Corsi]], activist [[Phyllis Schlafly]], among others, have formed a coalition against the amero.<ref>{{citeweb| url=http://www.canadafreepress.com/2006/cover121406.htm |title=Debut of the Amero, |author=Judi McLeod |publisher=Canada Free Press |date=2006-12-14}}</ref> On [[January 22]], [[2007]], Republican Representatives [[Virgil Goode]] of Virginia, [[Tom Tancredo]] of Colorado, [[Walter Jones]] of North Carolina, and [[Ron Paul]] of Texas were among the 43 federal lawmakers who introduced H. CON. RES. 40, a resolution that expressed: <blockquote>"The sense of Congress that the United States should not engage in the construction of a [[North American Free Trade Agreement (NAFTA) Superhighway System]] or enter into a North American Union (NAU) with Mexico or Canada."</blockquote>

== Effectivity==
The described profits in the economic efficiency of the member countries must be hefted towards the possible losses in their macroeconomic performance. It is foreseeable, nevertheless, that such disadvantages are small or nonexistent. The type of flexible exchange has not brought to Canada the macroeconomic benefits that were promised by who proposed that policy. The rate of unemployment keeps elevated and the economic growth has been slow. The economic thought evolution and the accumulated empirical experience in many countries have shown that the “subtle adjustments” in economic matter have failed under the regime of floating exchange rate. On the other hand, the greater flexibility in the work market, essential to cushion economic shocks, decreased by the mere existence of the floating exchange rate. The temporary protection that was given to the producers and workers by means of exchange depreciation, generated inefficiencies very similar to those that in the past produced the temporary protection granted by duties. In the case of Mexico, the floating exchange rate adopted since 1995 has worked surprisingly well in respect to the pessimist perspectives that were had, but there prevails a very high inflation, of around 9 percent in 2000, with interest rates that stay near the 15 percent, that turn to be prohibitive for an appreciable reactivation of the credit.

The United States has less potential benefits of a monetary union than which Canada and Mexico would win, but there will be non-despicable dividends. A monetary union, as the described one, will reduce the threat that the American dollar will lose its superiority in case the euro displaces the dollar in the rest of the world, which at the moment seems rather remote, but can happen way ahead. In addition, the United States will benefit by having more stable and prosperous countries as neighbors. When the United States was united to international organizations like the International Monetary Fund (FMI), the World Bank (WB), the World Commerce Organization (WCO) and the North American Free Trade Agreement (NAFTA), the gained profits in economic and political matter fully compensated the modest loss of sovereignty that entailed its adhesion. In this same tradition, the United States can well find that it is worth to add itself to the proposed monetary union.


== Rumors of "Amero coins" ==
== Rumors of "Amero coins" ==

Revision as of 22:39, 21 October 2008

Map of the theoretical NAU, with Canada, Mexico and the United States

The North American Currency Union is a theorized economic and monetary union of the three principal countries of North America, namely Canada, the United States, and Mexico.[1] Implementation would probably involve the three countries giving up their current currency units (Canadian dollar, U.S. dollar, and Mexican pesos) and adopting a new one, created specifically for this purpose. The hypothetical currency for the union is most often referred to as the amero.[2][1] The concept is modeled on the common European Union currency (the euro), and it is argued to be a natural extension of the North American Free Trade Agreement (NAFTA) and the Security and Prosperity Partnership of North America (SPP). Conspiracy theorists contend that the governments of the United States, Canada, and Mexico are already taking steps to implement such a currency.[1] No current members of any country's government have officially stated a desire to implement a "North American Union."[3][4]

The commercial integration occurred between Canada, the United States and Mexico since the beginning of the North American Free Trade Agreement (NAFTA), has generated big amounts of commerce and investment between the three countries in extraordinary dimensions. Nor who proposed the Treaty, nor their detractors, have ever dreamed that the commercial and investments flows would reach the levels that they have acquired. The way in which the NAFTA allowed that the Mexican economy surpassed in a few six semesters the crisis in which it fell in December 1994, contrasts remarkably with what happened twelve years before, when the closed Mexican economy contributed in taking almost seven years to recover of the debt crisis. In this context, it is natural that the next stage of discussion on what to do improve even more the benefits that can be derived from the vicinity in the North American region includes the exposition of new ways of institutional approach. One of the more helpful ideas has been the one to propose a regional monetary union as suitable means to surpass the recurrent exchange crises that so much damage has done to Mexico and, to a lesser extent, to Canada in last the three decades.

It is particularly significant that this debate is taking place not only in Mexico and some other nations to the south of the continent, but even in countries like Canada that, in appearance at least, they have obtained a reasonably successful situation. The book that now offers the Research Center for the Development, C.A. (RCDCA) on this subject has as intention to encourage and to inform about this debate. The author of the text is the distinguished Canadian academic Herbert Grubel, Professor Emeritus of the Fraser Institute. The text was adapted and updated by Manuel Suárez Mier, Mexican economist.


Basis and origin

The letter A inside a circle. The proposed symbol for the amero, originally chosen by Herb Grubel in "The Case for the Amero" [5]

The idea for a North American currency union was first proposed in 1999 by Canadian economist Herbert G. Grubel.[1] A senior fellow of the conservative Fraser Institute think-tank, he published a book titled The Case for the Amero in September 1999,[2] the year that the euro became a virtual currency. Another Canadian think-tank, the C.D. Howe Institute, advocates the creation of a shared currency between Canada and the United States.[6]

After the report came out, center-left nationalist groups in Canada expressed their opposition to any currency union because they view it as an attempt by American businesses to gain access to Canada's extensive natural resources while dismantling the nation's social services.[1] The 100,000 member strong Council of Canadians, a progressive advocacy group, has declared one of its central issues to be the threat of "deep integration".[1]

It was soon introduced as a monetary foundation of "macro economic cooperation" among the three NAFTA countries by Dr. Robert A. Pastor, Professor of International Relations at American University, a member of Council on Foreign Relations(CFR), who served as co-chair and a member of the 2005 CFR' Independent Task Force on the Future of North America. [7] [8]

The amero is a common currency proposed for North America and spreadable to Central and South America within time. Between the proponents of this idea are the C.D. Howe Institute and the Fraser Institute of Canada. Also the Research Center for Development, C.A. (RCDCA) of Mexico, that is directed by Luis Rubio. The currency would initially circulate in the countries of the North American Free Trade Agreement (NAFTA), since Greenland is an autonomous territory belonging to the Kingdom of Denmark, in Europe.

The day in which the Monetary Union of North America begins to function, Canada, the United States and Mexico will replace their national currencies with the amero. That day, all the bills and coins denominated in U.S. dollars will change at the rate of one by one by an amero (A). Canada and Mexico will exchange their respective currencies, the Canadian dollar and the Mexican peso, to an exchange rate that leaves to the competitiveness and wealth of both nations unaltered. Within the three countries, prices of goods and services, salaries, investments and liabilities, will be turned simultaneously to ameros at the same exchange rate in which the respective national currencies were converted.

Support

Canada

One argument is that it would save up to $3 billion in currency transactions.[9] The same authors also stated that Canada's GDP could rise by up to 33 percent in a 20-year period given the adoption of a single currency.

The idea of a common currency has historically been unpopular in English speaking Canada, in comparison to the province of Quebec where it has received more support. An opinion poll taken in 2001 found that in Quebec over 50 percent of respondents favoured the idea. While in the rest of Canada the majority of respondents opposed the idea of a shared currency. [10]

Mexico

The possibility of a monetary merger has also been discussed in Mexico as a natural step to take after NAFTA.[11] Former Mexican president Vicente Fox echoed that view and expressed his hope for a greater integration of Canada, Mexico and the United States, including an eventual monetary union, whilst on a 2007 promotional tour for his book "Revolution of Hope."[12][13]

Support in other regions

Lower levels of currency cooperation have been practiced in the Americas before. Some nations such as Argentina, Brazil and Canada have at times tied their currency to the U.S. dollar. Some of them, such as Aruba, Bahamas and Barbados still do.

The U.S. dollar is officially accepted alongside local currencies in El Salvador (since 2001), Nicaragua, Peru, Honduras, and Panama, although in practice two of these countries (El Salvador and Panama) are fully dollarized. In 2000, Ecuador officially adopted the U.S. dollar as its sole currency.

Unofficially, the U.S. dollar is treated as a de facto secondary currency in much of Central America and the Caribbean.

Currency integration is also one of the many long-term aims of Unasur (Union of South American Nations), a supranational organization comprising all the sovereign nations of South America, modeled after the European Union.

Symbols

The plan for a North American Monetary Union displayed in this study is designed to include Canada, the United States and Mexico. Under the proposed plan, the bills and coins in circulation of the new monetary unit, tentatively called “amero”, will carry their own symbols in a side and the national emblems of each country in the other, thus preserving important symbols of the national identity. The conversion of the respective national currencies to ameros will be determined to an exchange rate that keeps unaltered the real entrance of each country, its pre-existent wealth and international competitiveness at the time of the conversion.

The North American Central Bank, like the European Central Bank, will have a constitution that will only make it responsible for the maintenance of the stability of prices and not of the total use of labor hand. The three countries in the union will have representatives in the directive levels of the Bank in proportion to their relative size, in terms of some weighed average of population and national income, with average raters that would be determined through negotiation between parts. Each country will receive the corresponding profits to the emission of ameros -the seignorage- that they use in their respective economies.

The commerce between the members of the monetary union will be stimulated by the elimination of transaction costs and the implicit risks in the currency interchange. There will be greater stability in the prices and, something very important; the interest rates will lower approximately one percentage point in Canada and Mexico, where they still stay at a level of two digits, even more.

Criticisms and problems

Opposition to a North American currency union exists high up in the governments on both sides of the Canada–United States border. Herbert Grubel, the first proponent of the amero, admits that American officials show no interest in the topic.[1] He concedes that "there wouldn't be very much benefit for the United States" in an amero.[1] Likewise, the Canadian Department of Finance strongly opposes the creation of a common currency with the United States, citing the loss of economic sovereignty. In briefing documents to Minister of Finance Jim Flaherty, finance officials concluded:

"A North American common currency would undoubtedly mean for Canada the adoption of the U.S. dollar and U.S. monetary policy. Canada would have to give up its control of domestic inflation and interest rates."[14]

Trade-offs

From the point of view of the Canadian and Mexican governments, a major obstacle to the creation of a unified currency is the sheer dominance of the United States in any such union. Unlike any country in the EU, the USA has a larger economy than the rest of its respective continent/union combined.

A University of California, Santa Barbara paper puts forward the idea that the United States simply has too many advantages from the status quo to move toward a single currency.[15] The United States dollar already acts as a global currency, meaning any transition to a 'new' currency would risk compromising this position and could cause a shift toward the euro or yen. The U.S. dollar is currently being used in over half of all the world's exports, double the total United States foreign trade. The adoption of the amero could threaten the seigniorage that America currently gains from its American dollar. While seignorage would still be gained from the amero, this would be shared among the Bank of Canada, the Federal Reserve, and the Banco de México. Therefore, even if the amero were used just as much as the U.S. dollar, the advantages would be shared among two or more countries, and not exclusively earned by the United States.

Differing economic policies and situations

Several problems could arise in regards to macroeconomic management. By submitting to a common currency, the countries would lose considerable autonomy in the management of the currency itself, including the setting of interest rates. Amongst the three potential participants, there is considerable difference in policy which would have to be reconciled.

Debt is a factor affecting currency prices. As of 2008, the debt of the United States continues to increase, while the debt of the Canadian federal government is being reduced. [16] This is a clear advantage for Canadians and it would not be reflected if the currencies were to merge. The importance of commodities also factors into this equation.

A concern with any unified North American currency is the differing economic situations between each country. The Eurozone is broadly similar being service-based economies[17] based on high public spending (compared to the United States), high taxes and wealth being created by the sale of goods and services. North America on the other hand has three distinct economies; one based mainly on agriculture and manufacturing, with a demand for free trade (Mexico), another based on services such as retail, with low taxes and low public spending (United States), and a third based on services with higher taxes and higher public spending, with a large sector in primary goods such as oil, mining and lumber (Canada).[citation needed]

Political mandate

Lou Dobbs, a reporter and commentator for CNN, has posited that the formation of a "North American Union" is actually being approached in Mexico, without the knowledge and consent of the majority of the people who would be affected by this.[18]

Conservative Caucus Chairman Howard Phillips, WND columnist and author Jerome Corsi, activist Phyllis Schlafly, among others, have formed a coalition against the amero.[19] On January 22, 2007, Republican Representatives Virgil Goode of Virginia, Tom Tancredo of Colorado, Walter Jones of North Carolina, and Ron Paul of Texas were among the 43 federal lawmakers who introduced H. CON. RES. 40, a resolution that expressed:

"The sense of Congress that the United States should not engage in the construction of a North American Free Trade Agreement (NAFTA) Superhighway System or enter into a North American Union (NAU) with Mexico or Canada."

Effectivity

The described profits in the economic efficiency of the member countries must be hefted towards the possible losses in their macroeconomic performance. It is foreseeable, nevertheless, that such disadvantages are small or nonexistent. The type of flexible exchange has not brought to Canada the macroeconomic benefits that were promised by who proposed that policy. The rate of unemployment keeps elevated and the economic growth has been slow. The economic thought evolution and the accumulated empirical experience in many countries have shown that the “subtle adjustments” in economic matter have failed under the regime of floating exchange rate. On the other hand, the greater flexibility in the work market, essential to cushion economic shocks, decreased by the mere existence of the floating exchange rate. The temporary protection that was given to the producers and workers by means of exchange depreciation, generated inefficiencies very similar to those that in the past produced the temporary protection granted by duties. In the case of Mexico, the floating exchange rate adopted since 1995 has worked surprisingly well in respect to the pessimist perspectives that were had, but there prevails a very high inflation, of around 9 percent in 2000, with interest rates that stay near the 15 percent, that turn to be prohibitive for an appreciable reactivation of the credit.

The United States has less potential benefits of a monetary union than which Canada and Mexico would win, but there will be non-despicable dividends. A monetary union, as the described one, will reduce the threat that the American dollar will lose its superiority in case the euro displaces the dollar in the rest of the world, which at the moment seems rather remote, but can happen way ahead. In addition, the United States will benefit by having more stable and prosperous countries as neighbors. When the United States was united to international organizations like the International Monetary Fund (FMI), the World Bank (WB), the World Commerce Organization (WCO) and the North American Free Trade Agreement (NAFTA), the gained profits in economic and political matter fully compensated the modest loss of sovereignty that entailed its adhesion. In this same tradition, the United States can well find that it is worth to add itself to the proposed monetary union.

Rumors of "Amero coins"

In August 2007, rumors and conspiracy theories began circulating across the Internet regarding alleged United States Treasury-issued "amero" coins.

The inspiration behind these rumors may have been the posting of images of medallions created by coin designer Daniel Carr.[1] Carr, who designed the New York and Rhode Island 2001 statehood quarters, sells medals and tokens of his own design on his commercial website, "Designs Computed" (also known as "DC Coin").[1] Among his designs are a series of gold, silver and copper fantasy issues of "amero coins" ranging in denomination from one to one thousand.[1] The coins have the legend "Union of North America" on the back with his company's logo, a stylized "DC",[20] in small type.[21] Concerning his "amero" designs, he mentions on his website:

My goal with these coins is not to endorse a Union of North America or a common "Amero" currency. I fully support the United States Constitution, and I would not welcome (in any form) a diminishment of its provisions. I expect that these coins will help make more people aware of the issue and the possible ramifications. I leave it up to others to decide if they are in favor of, or against a North American Union. And I encourage citizens to voice their approval or disapproval of government plans that impact them.[22]

Unauthorized postings of images taken from his website have been reposted widely across the Internet, often being used as supposed "proof" of the amero coinage. Notably, former Internet radio talk show host Hal Turner ran a full article on his website about the "amero coin", claiming to have arranged for a United States Government minted "amero" to be smuggled out of the Treasury Department by an employee of that organization.[23]

Following Turner's assertions of federal minting of ameros, a web site marketing the curio coins released a statement debunking Turner's claims of a government cover up regarding Daniel Carr's amero products.[24] The debunking website Snopes also ran a further debunking of Turner's claims, stating:

"Neither the U.S. Mint nor the U.S. Treasury has a hand in creating these 'Ameros'. These coins are merely collectibles offered to the buying public by a private company in the business of manufacturing such curiosities."[25]

Hal Turner claimed that Carr's website had been created in haste in a matter of days expressly to discredit his claim about the coinage. [26] However, Carr's designs have been available through his website since 2005,[27] and according to a WHOIS search at Network Solutions, the domain "dc-coin.com" was registered by Daniel Carr on 27 September 2005.[28] In October 2008, Hal Turner released a video showing an apparent 20 Amero coin, with claims that shipments of the currency had been sent to China. [29] Yet the coin in Hal Turner's video is identical to a medallion on Daniel Carr's "dc-coin" website, listed as "UNA 2007 1 Amero, Copper, Satin Finish". [30]

See also

References

  1. ^ a b c d e f g h i j k Bennett, Drake (2007-11-25), "The amero conspiracy", International Herald Tribune, retrieved 2007-11-28
  2. ^ a b Herbert G. Grubel (1999). "The Case for the Amero: The Economics and Politics of a North American Monetary Union" (PDF). The Fraser Institute. Retrieved 2007-09-20.
  3. ^ "SPP Myths vs Facts". Security and Prosperity Partnership of North America. Retrieved 2007-12-31.
  4. ^ "President Bush Participates in Joint Press Availability with Prime Minister Harper of Canada, and President Calderón of Mexico". Office of the White House Press Secretary. Retrieved 2007-12-31.
  5. ^ The Case for the Amero: The Institutions of a North American Monetary Union
  6. ^ "Canada Should Pursue North American Currency Union" (PDF). C. D. Howe Institute. June 22 1999. Retrieved 2007-09-25. {{cite web}}: Check date values in: |date= (help)
  7. ^ Robert A. Pastor (2001). Toward a North American Community: Lessons from the Old World for the New. Peterson Institute. ISBN 0881323284, 9780881323283
  8. ^ "Robert A. Pastor". SourceWatch. August 11 2008. Retrieved 2008-09-25. {{cite web}}: Check date values in: |date= (help)
  9. ^ W.B.P. Robson and D.E.W. Laidler (2002). "No Small Change: The Awkward Economics and Politics of North American Monetary Integration". C.D. Howe Institute Commentary: The Border Papers, Toronto, Ontario. 29. C.D. Howe Institute.
  10. ^ Leger Marketing Group (August 30 2001). "A Study of How Canadians Perceive Canada-US relations". {{cite journal}}: Check date values in: |date= (help); Cite journal requires |journal= (help)
  11. ^ Fabián Muñoz El Norte (April 10, 1999). "Unificarían moneda México, Canadá y EU". Retrieved 2007-09-05.
  12. ^ Vicente Fox | The Daily Show | Comedy Central at www.thedailyshow.com
  13. ^ CNN.com - Transcripts at transcripts.cnn.com
  14. ^ Chase, Steven (2007-11-22), "Consider a continental currency: Jarislowsky", The Globe and Mail, retrieved 2007-11-28
  15. ^ Benjamin J. Cohen (2004). "North American Monetary Union: A United States Perspective". Global & International Studies Program. Retrieved 2007-09-05.
  16. ^ Federal government net financial debt at www40.statcan.ca
  17. ^ European Economic Statistics, Fig.2.2.2, Eurostat Statistical Books
  18. ^ CNN.com - Transcripts at transcripts.cnn.com
  19. ^ Judi McLeod (2006-12-14). "Debut of the Amero,". Canada Free Press.
  20. ^ Catalog of Minted Items by Daniel Carr at www.designscomputed.com
  21. ^ "Photos of notional amero coins". The 'Amero' Currency. Retrieved 2007-12-03. {{cite web}}: External link in |publisher= (help)
  22. ^ "UNA Amero Pattern Coins". DC Coins. Retrieved 2007-09-25.
  23. ^ "Amero Coin Arrives (Internet Archive)". Hal Turner Show. Retrieved 2007-09-10.
  24. ^ "Response to Turner claims of U.S. Government Amero Cover Up". AmeroCurrency.com. Retrieved 2007-09-11.
  25. ^ "Amero Uproar". Snopes.com. Retrieved 2007-09-08.
  26. ^ "Hal Turner's AMERO Coin Story". Educate-Yourself.org. Retrieved 2008-08-29.
  27. ^ Internet Archive Wayback Machine at www.dc-coin.com
  28. ^ WHOIS domain registration information results for dc-coin.com from Network Solutions at www.networksolutions.com
  29. ^ "Hal Turner Shows NEW Amero Currency". Youtube.com. Retrieved 2008-10-09.
  30. ^ "UNA Ameri Pattern Coins". dc-coin.com. Retrieved 2008-10-18.
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