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The Marty Cortland Stimulus Plan: Buy Canada

Marty has been bugging me for weeks to post this. The funny thing is, he’s actually half-serious. He thinks the United States should offer to buy Canada.

The Marty Cortland Stimulus Plan

Look, if we’re going to spend $10 trillion on this bailout with no guarantees that it will work, then I have a better idea: Let’s scrap the current plan and buy Canada instead.

I figure it will cost us $12 trillion on the front end, but …

– it will put the money directly in the hands of the Canadian consumer, resulting in immediate and substantial U.S. economic stimulus;

– we can recoup our investment in less than five years, and we’ll own a hard asset worth at least four times our investment; and

– it’s the ultimate capitalistic solution to our current problems.

As cockamamie as it sounds, there’s precedence for this. Jefferson spent $15 million in 1803 dollars on the Louisiana Purchase when the United States’ GDP was $480 million. Granted, at $12 trillion, we’ll be spending almost 84 percent of our $14.3 trillion GDP — but to put things in perspective, the per capita GDP in Jefferson’s day in 2009 constant dollars was $1,500, versus $47,000 today, making his outlay far more costly on a per-capita-GDP-adjusted basis. And what did Jefferson get us for $15 million? Only 829,000 square miles of land and a mostly hostile native American population with no measurable GDP. Buying Canada more than doubles our land mass (adding a whopping 3.85 million square miles!), adds 33 million educated, mostly friendly, mostly English-speaking citizens, and increases our GDP by $1.44 trillion. On an apples-to-apples basis, there’s no comparison.

Granted, Canadians are less productive than Americans — their per capita GDP is only $43,700 versus our $47,000 — meaning that the transaction will be slightly dilutive to our national earnings; but their federal debt, at a negligible $459 billion, is only $14,000 per Canadian, versus our $11 trillion federal debt, or $36,000 for every man, woman, and child in the country. Taking on their federal debt, but spreading the combined debt over our combined populations, would reduce our U.S. per capita debt by almost $3,000 per person.

And what do we get, tangible value-wise, for our $12 trillion? Well, with 13.8 billion acres of certified forests at an annual harvest of $150 per acre, we get an annuity stream of $2.8 trillion per year (and we put a whole lot of people to work logging that timber). With 179 billion barrels in proven oil reserves — second only to Saudi Arbia — we get $9.5 trillion in the ground at today’s price of $53 per barrel. And Canada accounts for 36 percent of the world’s potash production, with 59 percent of the world’s proven reserves. At $600 per ton and 10.7 billion tons of potash in the ground, we add another $6.4 trillion to the balance sheet. And this is before all of the iron ore, silver, nickel, zinc, copper, gold, lead, molybdenum, coal, natural gas, diamonds, fish, and wildlife we get in the bargain.

“But,” you say, “Quebec has been trying to break away from Canada for years, with no success. How are you going to do it?” To which I say, Google would never let its search or Adwords divisions decamp to another company. But at the right price, Google itself can be bought.

Canada has 23.4 million registered voters. Under the Constitution Act of 1982, amendments to the Canadian Constitution require the consent of two-thirds of the provincial legislatures representing at least 50 percent of the national population. We would essentially make a tender offer to 12 million of the country’s registered voters offering them $1 million in tax-free U.S. dollars to support an amendment to their Constitution dissolving their sovereignty and annexing themselves to the United States of America. Like the old corporate tender offer strategies (before minority shareholder safeguards were adopted), the offer would be on a first-come, first-filled basis.

Why do I think that we could get 12 million Canadians to take us up on our offer? I don’t. I think we would in fact get substantially more than 12 million takers, and we would have to turn a whole lot of citizens away. That said, with 8.5 million families, it would be safe to assume that at least one adult in the family would be a recipient, so the level of left-out-of-the-party disgruntlement would be manageable.

Bottom line, I believe that Canadians are really no different than Americans when it comes to aspirations for a better life, coupled with a sharp and persisting class envy. The median net worth of Canadians is $148,000, and barely 1 percent of the population has more than $1 million in liquid assets. Twelve million newly minted millionaires changes the dynamic profoundly. Like the old Vegas casino saying (“Walk in a Democrat; leave a Republican”), the chance to become an instant millionaire would make even the most nationalistic Canadian start whistling Yankee Doodle Dandy. Plus, with their beloved Obama in the White House, now is the most propitious time, culture-wise, to pull this thing off.

Granted, it’s an audacious plan, but Paul Krugman complained that Obama’s stimulus plan was not big enough. Mine is more than 20 percent bigger than the current plan, preserves and creates jobs (imagine $12 trillion sluicing into the economy!), reduces our per capita national debt, pays for itself in five years, adds almost unimaginable tangible net value to our national balance sheet, and changes the landscape, both figuratively and literally, for generations to come. And it completes our manifest destiny. What’s not to like? — Marty Cortland

39 comments on “The Marty Cortland Stimulus Plan: Buy Canada

  1. It sounds great and all, but we’d have to put up with all of those Canadians…

    It’s just not worth it.

  2. I thought Canada was the 51st state. Eh?

    Does this mean that Sonic will start serving poutine? Right on.

  3. I would like it because then I can start using my outrageous Franch-Canadian accent everywhere and people would just think that je suis un Quebecois. Savoir Faire is everywhere!

  4. Wouldn’t that mean all signs would need to be in both English AND French?
    Also wouldn’t that give Palin an even better chance at running for president next time around by increasing the hockey mom/ moose hunting population by a hell of a lot? I don’t think I like either of those two things.

  5. Chris, no we wouldn’t! As with every LBO or hostile takeover, there will need to be some cuts made, both in terms of benefits and staffing.

  6. What a coincidence. I was just thinking about the tax and revenue benefits of Dallas annexing the Park Cities.

  7. Canada basically did that with Newfoundland in 1949 and there’s been some talk of them doing it again with Iceland after their financial collapse.

  8. Dear Marty,
    As an ex-pat, it’s nice to see that you still write as though your azz was in your head. It lends flavour and colour to your prose.

    As I write today, there are approx. 33,601,791 hearty, Canada-loving soulds living in my homeland.
    See: http://www.statcan.gc.ca/edu/clock-horloge/edu06f_0001-eng.htm

    I can assure you that not a one of them aspires to be lie you or has American-envy at what has become of this country. With a stable home-ownership rate at ~68%, some 3% higher than the sinking US avg, without a tax deduction for a mortgage to help, and a stable banking system, whats’ to love? Especially coming from an anon. right-wing, nouveau riche blowhard living in the top 10 of the most hard-azzed, uncaring to the poor and diadvantaged, mysoginistic ststes in the Union.

    Sell yourself to Dallas, first.

  9. Why not save the money and just invade? One of the reasons they have so little national debt is they spend almost nothing on defense. They let US taxpayers foot the bill, knowing full well we have to ride to their rescue to protect ourselves. A great deal for them.

  10. If nations were to become available for purchase, let me suggest that in terms of realizing potential operational cost synergies — e.g., end of border protection costs, significant interest savings from elimination of the peso, etc. — that Mexico presents the more compelling buy.

    Moreover, I was once engaged to a Canadian girl, who acutely attented me to the reality that there is nothing that a Canadian hates more than to be mistaken for an American.

    Final consideration: Pamela Anderson.

    Discuss.

  11. Dear Mr. Canuck:

    You spell as if you’re still owned by Great Britain.

    Dear TOMC:

    I’ve considered the Pam Anderson and Mike Meyers problems, but they live here now. Therefore, we’ve realized that loss already.

    With respect to Mexico, why would we have to shell out money? Couldn’t we just take down the border wall and get it for free?

    Best,
    MC

  12. Dear Marty,
    That’s why I’m still in skool.

    BTW: It’s a flux capacitor Marty… that’s what your brain needs. A flux capacitor.

  13. After we annex the Park Cities, Dallas could use the sewers that the PCs borrow to funnel money into the Trinity Project.

  14. @Canuck: So far, the Americans have been more civil in this discussion (including Marty). Do you feel you are representative of Canadians? I was under the impression that they were generally pretty nice.

  15. Eric,

    Our increased proclivity for sketch comedy would be cancelled out by a preponderance of morose, vaguely pretentious folk-rock that’s good, even seminal — but funny? Joni Mitchell, funny? No. Leonoard Cohen a laff riot? Negatory, good buddy. Neil Young, keepin’ his sunny side up? Once every twelve years for one month only, like one of those bizarre flowers you read about but have never seen.

    Net result: No funnier.

  16. Dear Mr. Canuck:

    I was referring to your spelling of flavor and color, where you used the British variant, not to “sould,” which might have been a Freudian slip. (U.S. to Canada: “You guys for sale?” Canuck on behalf of Canada: “Sold!”)

    But I guess your response at least proved Eric wrong.

  17. Fuckin Yanks have nothing better to do than write crap like this. No wonder the world hates you

  18. Hey Tyler Aries! No fair. Don’t let Marty represent us all.
    We don’t hate you. In fact, you’re not even a blip on our radar screen. Not when we have real countries like China to worry about.

  19. Short of this becoming an international incident, most of my Canadian friends found it amusing, in the usual egomaniacal American way. However, if it will help the slow southern march of the Timbit speed up any…

    For the Texans, imagine your reaction if New York wanted to buy Texas.

  20. Don’t tease us, Seven. If New York is going to make an offer, please get them to hurry up!

  21. That was brilliant. Coming from someone with M&A experience, your article really intrigued me.

  22. I hope this would mean more sunbelt NHL teams moving back to where they appreciate hockey, like winnipeg, quebec and hartford (I know not technically canada, but essentially in the maritimes).

  23. Thanks, Tom P. I actually conceived of this about two years ago as a take-private deal to be launched by a consortium of hedge funds and private equity groups. Canada has considerably more value on a break-up basis than I indicated in my post. The deal would essentially be self-financing (by either pre-selling assets and/or floating bonds backed by hard assets) — with a big promote for the guys who put it together.

    When the economy and stock market crashed, I offered it up on a first-look basis to our government as a patriotic gesture. But, with inflation all but guaranteed if the Obama administration goes forward with its bailout/stimulus plan, there will be a scramble to get capital into inflation-proof hard assets.

    All yuk-yuk aside, this deal could get done. There is plenty of cash on the sidelines (estimated to be approximately $3.85 trillion in money market funds alone) to finance the equity tranche, which, at most, would be a 12-month hold.

    The interesting philosophical/sociological issue is having a “country” owned by a bunch of hedge funds and PEGs. (But then again, Iceland is owned by fewer citizens than I can see out the window of my office, so it’s more a matter of scale.)

    Best,
    MC

  24. Hi Mr C.,

    Thanks for your comment! While I still wouldn’t agree to the offer, I can certainly see where you’re coming from and why. It’s refreshing to hear some options beyond the current short-sighted “solutions”.

    I’ve left a reply on my blog. All the best,
    MM