A large area using a single currency will tend to exacerbate original, possibly small, regional differences. The manufacturing industry in The Netherlands was badly damaged by the discovery of offshore energy deposits. This new source of wealth drove up the country’s currency, making their manufactured exports uncompetitive.

Alberta is doing this to Ontario as we speak.

Free Trade is an even wider force for competitive ruin. We buy everything from China, because it’s cheaper there, and await their return of all that cash to buy everything we have left they might want. Mostly, investment in our energy out west. Soon I expect real estate, if it turns out you can still make money in real estate in Canada. (doing what? banking? for whom? bankrupt middle class-ers? accommodation? for whom? bankrupt middle class-ers?)

Now Iceland, which has had some interesting experiments with financial activities, is talking up adopting our loonie. This is a very bad idea. Iceland is an energy-economy country. That means Alberta would have competition, and Ontario would have two Albertas forcing the currency up and our competitiveness down.

My understanding of the IceSave debacle is, er, fairly rough. There were some investments. They were held mostly in the UK and The Netherlands and done via banks in those countries. When the investments went south, those countries’ banks were legally obliged to cover some of the losses. The legal position of Iceland at that exact time was such that it was not obliged to cover those same losses. There were unfriendly noises from Britain and Holland. The Icelandic (? never get these titles right) equivalent of parliament voted to pay up. It amounted to tens of thousands of dollars for every man, woman, and child in the country. The equivalent of their President said, should I fail to sign this bill, by law it goes to a referendum. He did and it did. Massive voter turn out. Major vote against.

This is the last I heard of this debacle. I do recall some vague details of what the Icelandic central bank did. They split the bank in trouble into two parts: one holding the potential bad debt, the rest holding all the good stuff. Hasta la vista, baby, went the bad bank. The good one is still operating and quite profitable.

So, what’s my point, you are asking. I have several.

• No currency sharing. No currency sharing. No currency sharing. What I tell you three times is true (with apologies to Lewis Carrol, eh?). Do not let this happen. Not with Iceland. Not with the USA. Not with anybody.
• Currency mitigation should be part of federal policy. Ontario needs the cash equivalent of the competitive losses from the higher dollar.
• We need a new Prime Minister. One that doesn’t hate Ontario and love Alberta. One that doesn’t think the world’s largest single source of carbon dioxide emissions is A-plus OK. One that doesn’t think the tales of mutated fish and carcinogenic chemicals downstream of The Tar Sands is fine, so long as he doesn’t have to live, eat, drink, or breathe there. One that doesn’t understand that 200 tankers per year (one estimate) through our western seaboard is an environmental risk of major proportions. One that listens to voices other than his own. One that considers opinions other than his own. A leader, not a dictator. One we can trust.