American currency union
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Currency union in the Americas is an idea based on the common European Union currency, the euro. The hypothetical American currency is sometimes referred to as the amero. The proposal is supported by some economists, but is not likely to be enacted in the near future.
Region
As well as calls for a currency for the Americas as a whole, in Canada discussions of a more limited crossborder currency union are common. The C.D. Howe Institute, one of Canada's leading economic think tanks, advocates the creation of a shared currency between Canada and the United States. The Fraser Institute, a leading conservative think tank, has also argued in favour of the amero. Herbert G. Grubel, a senior fellow of the Fraser Institute, came out with a book title The Case for the Amero in September 1999. Conversely, groups such as the Council of Canadians strongly oppose any move towards currency union as being extremely harmful for the Canadian economy and Canadian sovereignty.
Cases for
There are many lower levels of currency cooperation that have occurred in the Americas. A number of states – such as Argentina and Canada – have at times tied their currency to the United States dollar, and in 2000 Ecuador adopted the US dollar as its sole currency. In much of Central America and the Caribbean the US dollar is already a de facto secondary currency, and it serves as parallel legal tender in both Panama (since independence in 1903) and El Salvador (since 2001). Some pundits thus argue that currency union is all but inevitable, whether it is desired or not.
Cases against
A major obstacle to the creation of a unified currency is the sheer dominance of the United States in any such union. Unlike any state in Europe, the USA has a larger economy than all the other American nations combined, and monetary policy would thus inevitably be heavily tilted in favor of the United States. #redirect Another obstacle for the creation of an American Monetary Union would be getting the Central and South American nations to join. South America continues to shift towards the left while the US is shifting towards the right. The major differences between the ideologies of the countries of the Americas would make it nearly impossible for anything productive to occur.
Effects
Timeline
See also
External links
- [Canada Should Pursue North American Currency Union]
- [Alternative Amero Currency Article]
- [Fraser Institute - The Case for the Amero]
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