The states are not independent countries. They are all subsidiary units of one country. Some have been in this association for centuries.
But would some states (california?) benefit from having an independent currency? Establish its own interest rates, taxation etc?
That sort of stuff was tried before. We had a little kerfuffle to settle the matter. The upshot was that it was determined that states could not go off on their own whenever they darn well felt like it.
US “states” are not “states” as the rest of the world uses the term. They should be considered “federal provinces”, for provinces is what they actually are.
I seem to recall the incident you refer to. But I was thinking more hypothetically, the fact that European countries resist economic integration on the basis of retention of fiscal control could be an argument to secede for a “state” in economic distress. I’m not familiar with American federal history but hasn’t Texas retained the right to secede from the Union?
While the constant drumbeat of “the Confederacy was right” sites and posts is enough to drive one mad, yet it must be said that this is not quite right, either. The US states do possess distinct sovereignties, as provinces ordinarily do not.
No, but it did retain the right to divide into as many as five states, so as to increase its effective Senatorial representation from two to ten. Fortunately, the fear of a breakdown in Texan solidarity, should that happen, has always kept the threat in abeyance.
Not in the least. I likewise challenge the person who claims that Texas has the “right” to subdivide itself to produce the SPECIFIC portion of the US Constitution or the Texast state Constitution that says this.
Texas has no more right to subdivide into multiple states than does, say, Delaware. Section 3 of Article IV of the Constitution:
Texas may, therefore, indeed divide into five portions, or two, or 28, as long as the Congress and the Texas legislature agree. As can, say, California. A principle of the Constitution is that all new states are admitted on the same footing as the Original 13. In the case of Texas, specifically, the Supreme Court said:
Where the confusion arises is that Texas was an independent republic before admission; unlike, say, Iowa. The conditions of the Joint Resolution admitting Texas included this provision:
Further reading of this section, however, shows that this provision is concerned not with the number of states to be formed out of Texas or with some “special right” of divisibility granted to Texas. This section was included to address the delicate balance of Slave and Free states and the Missouri Compromise:
Again, the Joint Resolution admitting Texas, and the Treaty of Annexation, did not grant Texas any right that the other states did not already have. I realize that I have just contradicted multitudes of Texas junior high school civics teachers, but there you go. The original documents are pretty clear.
The language Dogface is seeking is in the joint resolution of Congress admitting Texas as a state, signed by President James K. Polk on 29 December 1845. More about this, including the actual language can be found on snopes.com at the following website
As for Texas’s (or any state’s) unilateral right to secede I think that was definitively answered in 1861. Whether that decision was legally correct is mere esoterica, as a pretty strong precedent was established.
Damn simulposts. Go through all that trouble to look up the originals myself, and there’s Snopes scooping me.
Do we have a “harrumph” smiley?
I hate to say it, but this has got a wee bit far afield of discussions of the Staff Report on currencies… ?
Sure has But it’s very educational.
Yep. A little tangent now and again is great learning, but now we’ve asked and answered the Texas question, so I’m trying to steer us back to the main track.
Nay, I’m young. I’m Republican. And I have no intention of dying anytime soon.
I believe that eventually we’ll have a world-wide currency, however I cannot envision such happening until the world starts to get along better with itself.
Right or wrong of wars, so long as countries kill each other, we’ll likely never have the unity to mimic Europe on a large scale.
To summarize:
Reasons for different currencies:[ul][li]Separate control of import/export ratio.[]Separate control of economic costs (e.g., labor, insurance, infrastructure) relative to other currency regions.[]Separate control of government spending (budget deficit/surplus).[]Separate control of economic growth rate[/ul]Overall: more economic independence.[/li]
Reasons for same currency:[ul][li]No exchange costs.[]No risk of currency instability (especially no boom/bust cycles caused by currency speculation).[]Larger markets (economies of scale, and greater specialization).[]Greater economic flexibility (i.e., easier for companies and workers to relocate).Smoothing of growth/recession cycles.[/ul]Overall: more economic interdependence.[/li]
If the world’s economy becomes tightly enough integrated, then it is likely that one world-wide currency will be adopted. (It may be a de facto standard rather than an official one.) However, I cannot see this happening this century. There is just too much difference in ecomonic development patterns among different nations for this to occur. Only once most countries have reached a similar level of economic development, will a one-currency be realistically possible.
Nice summary, Pleonast, I’d only add one additional argument against a common currency: inertia, the strongest force in the universe. “We’ve never done it that way before.” And especially when heads of government think that a common currency means “surrendering sovereignty” and “losing control.”
BTW, I think you’re being a big sanguine about the potential future world-currency. When I first started working internationally, in the early 1980s, we talked about the goals of what was then called the European Economic Community (EEC), which included a common currency. Americans and Europeans alike laughed at this as being entirely impractical, and would never be reached in our lifetimes. Less than 20 years later, and here we are. So, I’m more careful about what I predict nowadays.
Thanks, C K Dexter Haven, just trying to keep the thread on track.
You’re right about inertia against a single world currency. That’s why I expect we’ll have a de facto currency rather than an official one. Although, I guess the WTO or its successor could eventually work toward a single currency.
The primary reason I don’t think we’ll see a single world currency anytime soon is Sub-Saharan Africa. Too many hopeless economic (and political) basket cases there. Even if they get their acts together (probably with external help/prodding), they’ll be in a high-growth mode for long time, just because they’re so underdeveloped now. It’ll be better for them to keep a separate currency.
More regional currencies are much more likely this century. With good management, South America, East Asia, and North Africa could each form viable single-currency blocs. But even once each of those regions catches up to the western economies, I expect differences in economic cycles will keep larger super-regional blocs from forming.
But hey, who knows what the future will bring? 
I think you’re all pointing the wrong way on this – the real question is “when will the euro be dropped?”
Single currency has been tried by dozens of countries outside of Europe and is still in effect in many of them – countries that have either used the US dollar as their actual paper currency, or tied their own currency’s value to the dollar by manipulating the exchange rate. This has generally been done by third world countries or smaller countries in an attempt to stabilize their economy. The problem is that it does not stabilize their economy, it just postpones the collapse until such time as the government can no longer maintain the exchange rate. It’s been quite messy.
Europe, in spite of language and culture differences, is reasonable homogeneous as far as economies go (at least from a global perspective). The euro is already having troublesome effects on some countries within the EEC, and I think the late adopters are seeing the future in time to avoid a troublesome fate. It may be that the euro does not survive when all is said and done.
Oh, and I don’t plenty of republicans that would accept a world currency – as long as it has George’s face on the front of it! As for this humble democrat, I like the finkle. Euros just take all the fun out of coin collecting.
Please demonstrate how this “right” is any different from what is already provided for in Federal and Constitutional law for all states.
No. If you want further discussion on Texas, start a new thread in General Questions or Great Debates or somewhere. I allowed this thread to go a bit off on a tangent briefly, but now it’s back to the euro.
Pleonast provided a very good summary of pros and cons to unified currencies, but there is an important point to be made: The loss of control is upon the individual monetary authorities (e.g, the Fed), not the fiscal authorities (e.g., US Congress).
The distinction between the Euro and the United States Dollar is the implementation of the “single currency.”
The USA still allowes each state unbridled fiscal authority. Sure, in current times the federal government uses various tactics to get various states to spend money the way the Feds want, but in the end, it’s still up to each state how it spends its own money. The European Monetary Union, in contrast, placed very strict requirements on its member countries, such as bands of allowed inflation and fiscal deficit. (I wouldn’t want to get further into this point for fear of losing my self control at the keyboard.) This has not happened in the USA.
Yes, in the case of the EMU/Euro, fiscal authority was given up, but that was due to how Euro member countries chose to implement the Euro. If giving up fiscal authority had been a requirement of making a single currency, then the USA wouldn’t be as it is today.
As to the question at hand: I too don’t see a global single currency or global Euro in the foreseeable future. De facto global currencies are born out of necessity and practicality, but an official single currency would require very great advances in geo-politics.