Our neighbors to the north are trying to bring the heat on us. When I was up in Montreal two weeks ago, I did hear the usual “mine is bigger” argument going on in the lobby of the Opus Hotel, as a Canadian went on and on and on about healthcare. The day before, a bit of channel surfing brought me to Prime Minister Stephen Harper, talking about how Canada had fared better than the United States through the worldwide financial crisis. Now, the Canadians are saying that the U.S. has to do a better job of managing its financial system, because when Americans sneeze, the rest of the world blames us for giving them a cold.
Mark Carney, Bank of Canada Governor, and Jim Flaherty, the country’s Finance Minister, say that Canada has done its part, and now it’s time for the rest of the world to contribute. Of course, most of this is directed at the United States. The big problem to which they point is that imbalances involving countries like the United States, which run hefty trade deficits, and others that run tubby surpluses, like China, can be destabilizing.
Because not everything is our fault, Carney and Flaherty also say that economies in Asia need to let their currencies float more freely.
Canada’s probably just bitter about the exchange rate. When the U.S. dollar plummeted against its Canadian counterpart (and so many other currencies) under the Bush administration, it got difficult for Canada to export to the south. Now, with our dollar down 14 percent against theirs, Canada’s back in the same situation. Now, Canada is dealing with its first trade deficit with the United States after a 30-year run of surpluses.
They concede that progress is being made, but it’s not enough. As usual, Canada’s focused on the currency (they’re always focused on the currency, up there). So, when in doubt, blame the States.