No CrossRef data available.
Article contents
United States International Financial Policy*
Published online by Cambridge University Press: 07 November 2014
Extract
The United States and Canada have had a more or less parallel economic development throughout their histories and they have emerged from World War II as the two most important creditor nations of the world. It is not surprising, therefore, to find that their foreign economic policies and objectives are similar in character. Our countries are the leading champions of liberal trade policies and of a world system of multilateral payments. They constitute the vanguard in the fight against economic blocs and restrictive exchange and trade practices. Not only is a large portion of the foreign trade of both Canada and the United States dependent upon a system of multilateral payments but trade between Canada and the United States requires settlement by means of a Canadian surplus with third countries.
The differences in our approach to international economic problems stem largely from the difference in the relative importance of foreign trade in the two countries. In 1938 Canada's total foreign trade amounted to nearly 40 per cent of her national income, while total exports and imports of the United States were only 8 per cent of United States national income. On the other hand, United States exports in 1938 were three and a half times the value of Canadian exports and the world supply of United States dollars has been generally recognized as the most important single factor in world trade. (I believe that in the future when we speak of a “dollar shortage” it will not be necessary to differentiate between United States and Canadian dollars.) Canada, therefore, has the greater immediate economic interest in world trade, but the United States has, in a sense, the greater responsibility. Canada must adjust her economy to a given international economic environment while, at the same time, co-operating with other countries in the creation of a more favourable world environment. The primary concern of the United States must be with the environment itself. Needless to say the task of our administration in promoting a worldwide liberal trade programme would be far easier if United States foreign trade were 40 per cent of our national income instead of less than 10 per cent.
- Type
- Articles
- Information
- Canadian Journal of Economics and Political Science/Revue canadienne de economiques et science politique , Volume 12 , Issue 3 , August 1946 , pp. 313 - 321
- Copyright
- Copyright © Canadian Political Science Association 1946
Footnotes
*
This paper was presented at the annual meeting of the Canadian Political Science Association in Toronto, May 24, 1946. The views expressed in this paper are the author's and not necessarily those of the agency in which he is employed.
References
1 Rasminsky, L., “Anglo-American Trade Prospects: A Canadian View” (The Economic Journal, 06-Sept., 1945, pp. 161–78).Google Scholar
2 Proposals for Expansion of World Trade and Employment (Department of State, Washington, 1945), p. 14.Google Scholar
3 Anglo-American Financial and Commercial Agreements (Department of State, Washington, 1945).Google Scholar
4 Proposals for Expansion of World Trade and Employment, p. 14.
5 Articles of Agreement, The International Monetary Fund and International Bank for Reconstruction and, Development (Treasury Department, Washington, 1944), p. 14.Google Scholar
6 Proposals for Expansion of World Trade and Employment, p. 15.
7 Anglo-American Financial and Commercial Agreements, p. 9.
8 Articles of Agreement, Article VI, sec. 3.
9 Ibid., Article IV, sec. 5f.
10 Bernstein, E. M., “British Policy and a World Economy” (American Economic Review, Dec., 1945, pp. 891–908).Google Scholar
11 The repurchase provisions do not apply if the member's monetary reserves are below its quota, or if the Fund's holdings of the member's currency are less than 75 per cent of its quota (Articles of Agreement, Article v, sec. 7).
12 Statement of the Foreign Loan Policy of the United States Government by the National Advisory Council on International Monetary and Financial Problems, February 21, 1946.