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“Go big or go home.” That’s the advice that the collective pundit chorus is chanting at President Obama. Small ball isn’t going to get the job done, they say. The chorus has seen this movie before—it was called the Carter Presidency—and they know how it ends. It ends badly.
Alas, the chorus’ idea of “going big” is basically more stimulus, in whatever form they favour. For some it’s Quantitative Easing 3.0. For others, it’s some kind of “grand bargain.” Still others favour tax cuts. Still others favour classic Keynesian prime-pumping, through increased government spending.
These are all worthy ideas (or theories), but there’s an implicit sunset assumption; sometime after they begin they end. And that if they don’t work before they end, confidence in the government’s ability to do anything to jump-start economic activity will be diminished at best, and demolished at worst.
Make no mistake about it; on its present course, global economic activity is likely to get worse before it gets better. There is a very real possibility that the woes of the eurozone will mushroom into a Lehman-style financial crisis in September or October of this year. Such a financial crisis initially would be euro-centric, but ultimately (and quickly) it would have global ramifications.
Most important, it would destroy what little confidence exists about the possibility of any kind of near-term economic growth. The United States and the entire western world would be looking at a 10-year slog to recovery and the very real possibility of what diplomats call “geopolitical instability” on the European continent.
What is needed now is something really big—a great notion that allows Americans a whole new view of their future. The idea that just might change everything is a merger between the United States of America and Canada. If President Obama proposed such a union, it could alter the trajectory of history and ignite an explosion of economic activity.
What would a United States of North America (or the United States of America and Canada) accomplish? Future energy needs: met. Food supply: 100-year horizon. Brainpower upgrade (for both countries): major. Improved education institutional base: instantly. Financial system stability: increased. Health care coverage: done (from President Obama’s point of view). National security upgrade (for both countries): significant. Larger territorial presence: obviously. More vigorous trading partnership: on day one. The list goes on (and on).
Downside: Canadian Senators! Hey! Into every life a little rain must fall. Plus, we’ll have to regard Canadians as our equals, which is of course preposterous, but again, rain is part of the weather. And the Quebecois? Irritating, I agree. But so what? It’s all small beer. In 30 years, everyone will be American anyway. It’s more fun.
Back in 1991, Boris Yeltsin proposed to then-President George H.W. Bush that the United States acquire Siberia from the collapsing Soviet Union for $2 trillion. President Bush passed on the deal, on the theory that although it was a great deal for the United States (and a history book maker for him personally), it was too destabilizing. It was one thing that the Soviet Union was literally falling apart. It was another thing altogether if that collapse resulted in Siberia becoming the 51st state.
But a merger is not an acquisition. And even if it didn’t work (or the Canadians rejected the tender offer), Obama would still be credited with thinking big and putting everything on the line to try to reverse the relentless downward spiral of our present economic situation.
America has long lived around the idea of the frontier; that you could light out to uncharted territory and stake your claim. President Kennedy sold his Administration’s agenda (and the space program within it) as a “new frontier.” That’s what America needs now to break out of its funk: a new frontier. Canada is not a frontier, but it’s the next best thing. A merger between the two countries would open up a whole new world of possibilities.
Why not? The one thing we know for sure is that the Obama Administration’s inter-agency sub-committee’s recommendation isn’t going to be better or bolder. It will be small ball or a collection of small balls packaged as “big ball.”
And whatever they propose will not work. The United States of North America, in 15-25 years, would work. Big time.