Andrew G. Marshall: Here Comes the Amero


Richard Moore

North-American Monetary Integration: Here Comes the Amero
By Andrew G. Marshall

Global Research, January 20, 2008

Many have now heard rumblings of the ³amero², a proposed North American currency
to replace the Canadian loonie, dollar and peso. However, most of the mentions 
of this concept, when discussed in the mainstream media tend to focus on 
suggesting that talk of an ³amero², and in effect, the accompanying North 
American Union, is nothing but a conspiracy theory created by deluded xenophobes
afraid of immigration and globalization. The Boston Globe recently wrote such a 
story, titled, ³The Amero Conspiracy², which stated, ³The SPP [Security and 
Prosperity Partnership] does exist, and its tri-national task forces continue to
meet, but its members consider it a way for the United States, Canada, and 
Mexico to collaborate on issues such as customs, environmental and safety 
regulations, narcotics smuggling, and terrorism. The amero, on the other hand, 
appears to be purely theoretical.²1

However, despite being conveyed as ³purely theoretical², a recent article in the
national Canadian newspaper, the Financial Post, referred to the amero, not as a
theoretical idea or conspiracy theory, but as a potential reality. The article 
entitled, Fix the Loonie, lays out the process to be undertaken before the 
adoption of a continental currency known as the Amero.

The article was written as a response to a previous article written in defense 
of Canada¹s flexible exchange rate system, to which it states, ³David Laidler's 
recent defence of Canada's flexible exchange rate system misses completely the 
point made by Nobel Prize winning economist Robert Mundell in his famous article
on optimum currency areas. Mundell's article has been widely credited with 
providing the intellectual base for the European Monetary Union and merits 
attention.²2 The article continued elaborating on the previous point made by 
Mundell, stating, ³If flexible exchange rates are best for Canada on the grounds
presented by Laidler, why would flexible rates not be best also for Alberta, 
Ontario or New Brunswick?² It continued, ³Milton Friedman's response to Mundell 
was that he would not advocate flexible rates for every possible region.²

The article contends that Canada is currently suffering from what the author 
refers to as the ŒDutch Disease¹, ³which is named after the problems that 
developed in the 1960s when the Netherlands sold natural gas that had been 
discovered on its coast. The increases in Dutch exports of resources, like those
of Canada in recent years, resulted in a strong appreciation of exchange rates, 
which was reinforced by interest rate policies of central banks and currency 
speculators.² It further states that, ³The disease manifests itself through the 
loss of domestic manufacturers' ability to compete abroad and with imports.² The
author then contends that, ³The disease manifests itself through the loss of 
domestic manufacturers' ability to compete abroad and with imports,² and that, 
³The Bank of Canada can keep interest rates low to discourage capital inflows 
and thus exchange rate increases, but at the cost of fuelling inflationary 

The author then states that there is only one true cure for Canada¹s ŒDutch 
Disease¹, ³inoculation of the system by fixing the exchange rate at a level that
allows manufacturers to be competitive, perhaps at the rate the Bank of Canada 
research identifies as the long-run equilibrium, around US90¢.² The author goes 
on to explain the reasoning behind this by giving the example that, ³The 
Netherlands and Austria in the years before the introduction of the euro 
successfully operated such a system and enjoyed near perfectly stable exchange 
rates against the German currency. The essential ingredient in this success was 
the official commitment of the central banks of these two countries to maintain 
the same interest rate as that of the German central bank.²

So if Canada were to do the same in relation to the US dollar, then Canadian 
interest rates would be subject to the rates set by the US Federal Reserve, with
our Bank of Canada lock in step. The author goes on to say, ³An analogous 
commitment by the Bank of Canada with respect to U.S. interest rates may not be 
credible, tested by speculators and therefore ultimately doomed to failure.² 
Then the article continues, and makes a startling announcement:

³However, there is a solution to this lack of credibility. In Europe, it came 
through the creation of the euro and formal end of the ability of national 
central banks to set interest rates. The analogous creation of the amero is not 
possible without the unlikely co-operation of the United States.

This leaves the credibility issue to be solved by the unilateral adoption of a 
currency board, which would ensure that international payments imbalances 
automatically lead to changes in Canada's money supply and interest rates until 
the imbalances are ended, all without any actions by the Bank of Canada or 
influence by politicians.

It would be desirable to create simultaneously the currency board and a New 
Canadian Dollar valued at par with the U.S. dollar. With longer-run 
competitiveness assured at US90¢ to the U.S. dollar. [Emphasis added].²

In summation, what the author is proposing is to fix the Canadian loonie to the 
US dollar at US$0.90, create a currency board, which would be an unelected, 
unaccountable, group of people to handle our monetary policy, creating a route 
around using the publicly owned Bank of Canada, to ensure the creation of a ŒNew
Canadian Dollar¹, which would be a prelude to the Amero. The author then 
explains that, ³Fluctuations in global demand for natural resources will always 
result in competition for labour and capital among Canadian manufacturers and 
producers of resources. But, at least, the firms in these sectors would no 
longer have to concern themselves with exchange-rate fluctuations and policies 
of the Bank of Canada.² The article finishes by stating, ³There will also always
be changes in the U.S. (and Canadian) dollar exchange rate against the euro and 
other major currencies. But these changes would have minor effects on the 
Canadian economy because 80% of the country's trade is with the United States.²

The author of this article is Herbert Grubel, a professor of economics emeritus 
at Simon Fraser University, who also happens to be a Senior Fellow at the Fraser
Institute, one of Canada¹s largest and most prominent pro-big business think 
tanks.3 Other senior fellows at the Fraser Institute include Eugene Beaulieu, 
who sits on the Academic Advisory Council to the Deputy Minister of 
International Trade in the Department of Foreign Affairs and International Trade
for the Government of Canada, Martin Collacott, former Canadian Ambassador, Tom 
Flanagan, ho is known as the ³man behind Stephen Harper², and is a member of 
what is known as the ŒCalgary School¹, which is an unofficial group of like 
minded thinkers who espouse neo-conservative views, and hold significant 
influence in the current Conservative government, even referring to Flanagan as 
the ³Godfather of Canada¹s conservative movement.²4

Flanagan also used to work for Preston Manning, who is also a senior fellow at 
the Fraser Institute, a former Member of Parliament, and former leader of the 
opposition, and other senior fellows include Gordon Gibson, a former Assistant 
to the Minister of Northern Affairs and later Special Assistant to the Prime 
Minister, Wilf Gobert, former Director and Vice Chairman of Peters & Co. 
Limited, ³an independent, fully integrated investment firm which has specialized
for 35 years in investments in the Canadian oil, natural gas, and oilfield 
services industries,² Michael Harris, former Conservative Premier of Ontario, 
Jerry Jordan, former President and CEO of the Federal Reserve Bank of Cleveland,
Ralph Klein, former Premier of Alberta, Rainer Knopff, a professor and also a 
member of the ŒCalgary School¹, and Brian Tobin, a former Industry Minister.5

The author of the Financial Post article which mentioned the amero, Herbert 
Grubel, wrote a paper for the Fraser Institute in 1999, entitled, ³The Case for 
the Amero: The Economic and Politics of a North American Monetary Union², in 
which he laid out the case for the creation of a regional currency for North 
America.6 In this paper, Grubel wrote that, ³The plan for a North American 
Monetary Union presented in this study is designed to include Canada, the United
States, and Mexcio,² and that, ³The North American Central Bank, like the 
European Central Bank, will have a constitution making it responsible only for 
the maintenance of price stability and not for full employment.²7

In discussing the issue of sovereignty related to a monetary union, Grubel 
stated that he thinks that, ³sovereignty is not infinitely valuable. The merit 
of giving up some aspects of sovereignty should be determined by the gains 
brought by such a sacrifice.²8 He continued in saying, ³It is important to note 
that in practice Canada has given up its economic sovereignty in many areas, the
most important of which involve the World Trade Organization (formerly the 
GATT), the North American Free Trade Agreement,² as well as the International 
Monetary Fund and World Bank.9 Despite admitting to several agreements and 
organizations of which strip Canadian sovereignty, Grubel suggests that losing 
sovereignty in these areas is still worth the benefits.

The introduction of the Amero is an integral aspect of the process of creating a
North American Union, much like the European Union. This process is being 
undertaken through the implementation of the Security and Prosperity Partnership
of North America (SPP), which was signed by the leaders of the three North 
American governments in March of 2005. This agreement is orchestrating the 
bureaucratic ³harmonization² among the three North American nations to pave the 
way for a North American Community, akin to the previous European Community, and
ultimately, a North American Union.

The push for this agenda is being driven by the US-based Council on Foreign 
Relations (CFR), the preeminent American think tank, and the Canadian Council of
Chief Executives, as well as the Mexican equivalent, Consejo Mexicano de Asuntos
Internacionales. In May of 2005, the three groups, as a result of their joining 
forces in a Task Force, released a report entitled, ³Building a North American 
Community,² in which they state that, ³The Task Force offers a detailed and 
ambitious set of proposals that build on the recommendations adopted by the 
three governments at the Texas summit of March 2005. The Task Force¹s central 
recommendation is establishment by 2010 of a North American economic and 
security community, the boundaries of which would be defined by a common 
external tariff, and an outer security perimeter.²10

Thomas P. D¹Aquino was the Canadian Co-Chair of the Task Force report and is 
also the President and CEO of the Canadian Council of Chief Executives, other 
Canadian members of the Task Force report include Allan Gotleib, former Canadian
Ambassador to the United States, Pierre Marc Johnson, former Premier of Quebec, 
John Manley, former Deputy Prime Minister of Canada, and after 9/11, negotiated 
the Smart Border Agreement with the US Secretary for Homeland Security Tom 
Ridge, and Wendy Dobson, former President of the C.D. Howe Institute, another 
one of Canada¹s most prominent think tanks, and former Associate Deputy Minister
of Finance in the Government of Canada.11

The C.D. Howe Institute has on its board of directors, individuals from Imperial
Oil Canada, a subsidiary of Exxon Mobil, General Electric Canada, BMO Financial 
Group, TD Bank Financial Group, Nortel Networks, Manulife Financial, Bank of 
Nova Scotia, Enbridge Gas Distribution, EnCana Corporation, Ford Motor Company 
of Canada, HSBC Bank of Canada, Astral Media, Merrill Lynch Canada, CIBC World 
Markets, and N M Rothschild and Sons Canada.12

In 1999, the C.D. Howe Institute published a report entitled, From Fixing to 
Monetary Union: Options for North American Currency Integration.13 In the paper,
it is argued that, ³The easiest way to broach the notion of a NAMU [North 
American Monetary Union] is to view it as the North American equivalent of the 
European Monetary Union (EMU) and, by extension, the euro.²14 It continued in 
discussing the issue of sovereignty, stating, ³That a NAMU would mean the end of
sovereignty in Canadian monetary policy is clear. Most obviously, it would mean 
abandoning a made-in-Canada inflation rate for a US or NAMU inflation rate.²15

The concept of a North American currency has not only been the object of 
discussion within powerful big-business think tanks, but has, in fact, been 
discussed in government positions. In May of 2007, Canada¹s then-Governor of the
Bank of Canada, David Dodge, said that, ³North America could one day embrace a 
euro-style single currency,² the Globe and Mail reported. Further, the article 
stated that, ³Some proponents have dubbed the single North American currency the
Œamero¹,² and further, ³Answering questions from the audience after a speech in 
Chicago, Mr. Dodge said a single currency was Œpossible¹.²16

In November of 2007, the Globe and Mail reported that, ³Canada should replace 
its dollar with a North American currency, or peg it to the U.S. greenback, to 
avoid the exchange rate shifts the loonie has experienced, renowned money 
manager Stephen Jarislowsky told a parliamentary committee yesterday,² and 
quoted Jarislowsky as saying, ³I think we have to really seriously start 
thinking of the model of a continental currency just like Europe.²17 The article
continued, ³Mr. Jarislowsky, a former Canfor Corp. director, said the loonie's 
rise to above par with the U.S. dollar is destroying manufacturing and could 
devastate the forest sector,² and that, ³Mr. Jarislowsky said Canada could 
either aim for a common North American currency or peg the loonie to the U.S. 
greenback at about 80 cents (U.S.), allowing it to float within a small band.² 
Jarislowsky, a billionaire often considered to be Canada¹s Warren Buffet, is a 
member of several corporate boards, and is also a member of the board of 
directors of the C.D. Howe Institute.18

Appearing on Larry King Live recently, former Mexican President and initial 
signatory to the Security and Prosperity Partnership, Vicente Fox, when asked a 
question about whether or not it was possible to see a common currency for Latin
America, responded by stating, ³Long term, very long term. What we propose 
together, President Bush and myself, it's ALCA, which is a trade union for all 
of the Americas. And everything was running fluently until Hugo Chavez came. He 
decided to isolate himself. He decided to combat the idea and destroy the idea,²
to which Larry King interjected, ³It's going to be like the euro dollar, you 
mean?² and Fox responded, ³Well, that would be long, long term. I think the 
processes to go, first step into is trading agreement. And then further on, a 
new vision, like we are trying to do with NAFTA.²19

So clearly, there is a move on toward a regional currency for North America, in 
conjunction with the formation of a North American Union. Monetary sovereignty, 
and especially the power to create and issue money, is perhaps more central to 
the idea of a free, democratic and sovereign nation than the right to vote. If 
we do not have the power over the issuance of money, it does not matter whom we 
vote for. It¹s the Golden Rule: he who has the gold, makes the rules. We, as 
Canadians, and other peoples of their respective nations should never relinquish
this sovereignty over to regional boards, private banks, or other unaccountable 
individuals. It is our right, not a privilege, and giving up such a right is 
akin to giving up the right to vote; it is anathema to democracy and a free 

1 Drake Bennett, The Amero Conspiracy. The Boston Globe: November 25, 2007:

2 Herbert Grubel, Fix the Loonie. The Financial Post: January 18, 2008:

3 Fraser Institute, Senior Fellows. Found at:

4 Marci McDonald, The Man Behind Stephen Harper. Walrus Magazine: October, 2004:

5 Fraser Institute, Senior Fellows. Found at:

6 Herbert Grubel, The Case for the Amero. The Fraser Institute: September 1, 


7 Herbert Grubel, The Case for the Amero. The Fraser Institute: September 1, 

      Page 4:
8 Grubel, Ibid, Page 17
9 Grubel, Ibid, Page 17

10 Council on Foreign Relations, Building a North American Community. 
Independent  Task Force on the Future of North America: May, 2005, Page vii:

11 Council on Foreign Relations, Building a North American Community. 
Independent  Task Force on the Future of North America: May, 2005, Pages 42-48.

12 C.D. Howe Institute, Board of Directors. Found at:

13 Thomas Courchene and Richard Harris, From Fixing to Monetary Union: Options 
for  North American Currency Integration. C.D. Howe Institute, June 1999:

14 Thomas Courchene and Richard Harris, From Fixing to Monetary Union: Options 
for  North American Currency Integration. C.D. Howe Institute, June 1999, Page 

15 Thomas Courchene and Richard Harris, From Fixing to Monetary Union: Options 
for  North American Currency Integration. C.D. Howe Institute, June 1999, Page 

16 Barrie McKenna, Dodge Says Single Currency ŒPossible¹. The Globe and Mail: 
May  21, 2007

17 Consider a Continental Currency, Jarislowsky Says. The Globe and Mail: 
November  23, 2007:

18 C.D. Howe Institute, Board of Directors. Found at:

19 CNN, CNN Larry King Live. Transcripts: October 8, 2007:

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