All those foreign manufacturers dining so richly nowadays on the newly swollen wallet of the Canadian consumer can't just nakedly admit that's what they're doing.

Greed might be a fine corporate incentive, but it has no place in a communications strategy.

So these companies issue smoky explanations about how they are exhausting pre-existing inventories, created when the Canadian dollar was at a much lower level, and how the system takes time to adjust to a stronger currency (even if the price hikes back when the loonie was falling seemed to take no time at all).

But when driven into a corner by the facts — for example, that the Acura MDX, a vehicle manufactured in Alliston, Ont., now costs at least $54,498 US in Canada, but only $40,910 here in the United States — the manufacturers resort to what has become their mantra.

The markets, they say, are different. And that's that.

It's a galling answer, especially to Canadian consumers who have been putting up with the disadvantages of an anemic currency for so long and who, reasonably, expect a break now that their loonie is actually worth more than the U.S. greenback.

But it's also the depressing truth. Canada might be technologically advanced and well educated, and a nation with its public finances in apple-pie order, but even in our free-trading, globalized world, Canadian consumers are a second-class citizenry.

There are relatively few of them, they are contained behind a political border that doubles as an economic barrier, and their choices are limited. In the end, they pay what they are told to pay.

South of the 49th

Here in the U.S., of course, the rules are much different.

America's 300 million consumers represent the biggest, richest and most competitive economy in history. They account for five per cent of the world's population but 30 per cent of its consumption. Much of the world, including Canada, makes its money by selling goods to Americans.

As a result, the U.S. dollar's slide against the Canadian loonie, the euro and other hard currencies has been irrelevant to consumers here.

"We haven't seen a major impact on prices as a result of the weak dollar," says Omer Esiner, senior market analyst with Ruesch International, a global currency tracker. "I think a lot of it has to do with the fact that manufacturers overseas are eating the cost of their strong domestic currencies."

Put another way, if manufacturers are keeping prices high in Canada because they can, they aren't raising them here in the U.S. because they can't. Not if they want to keep doing business in American markets.

Because Americans always have alternatives. Someone else is always willing to step in and offer them a better deal. Not that consumers here even notice.

Most, for example, don't realize they are paying less for a bottle of decent French wine at any corner liquor store here in Washington than Parisians do in their bodegas. The American girls who buy Lululemon pants in Clarendon, Va., don't know and don't care that the Canadian firm charges its customers in Toronto considerably more.

People here are too busy enjoying it all, encouraged by a government that urges them on to ever more consumption.

Only in the United States does the government allow taxpayers effectively to write off the interest they pay on consumer loans (as long as the loan is rolled into the family mortgage). Go to the mall, George W. Bush famously counselled Americans after the 9/11 attacks.

Business as usual, in modern America, means endless spending.

The benefits of a weakened buck

"It's a privileged position here because everybody in the world is trying to make the American consumer comfortable," says Clyde Prestowitz of the Economic Strategy Institute in Washington, DC.

But Prestowitz, a former U.S. trade official, knows the American deal is even sweeter still.

Washington essentially prints the world's money and has since the end of the Second World War. All internationally traded commodities, most importantly oil, are priced in U.S. dollars.

"It gives the U.S. a huge privilege," says Prestowitz. "It means that Americans can buy and borrow in their own currency. So whereas you in Canada, if you want to buy a Toyota, you have to sell something to get U.S. dollars and then you go buy a Toyota. In America all we do is just print dollars and send the paper to Japan and we get the Toyota."

Now, there is still some concern here about the dollar's slide, even if, as Prestowitz says, it's limited to a few academics in New York and Washington.

If the weakening goes far enough, the laws of economics dictate that prices here should rise; and several more sharp declines could provoke a run if international investors decide to park their available cash in some other currency.

Some members of Congress voiced mild worries last week and the administration responded, as it always does, with a rote expression of its commitment to a strong dollar.

But the U.S. government is also keenly aware of the benefits it is already reaping.

U.S. manufacturers are gearing up to sell their suddenly cheaper wares in world markets, notes Ruesch's Esiner. "Exports over the past couple of months have risen sharply and are contributing to overall growth here in the U.S."

His conclusion: "I think that the weak dollar up to now has had more benefit than it has harmed the U.S. economy."

So, what should be bad news for America winds up being bad news for just about everybody else instead. The rest of the world's foreign currency reserves, mostly held in U.S. dollars, are suddenly worth less, and foreign manufacturers now have to compete against cheaper U.S. exports.

The combination drives other countries crazy. A frustrated French President Nicolas Sarkozy told Congress last week that if the U.S. government doesn't do something about the falling dollar, it risks "economic war."

The assembled lawmakers didn't appear too worried. Such a war is a distant prospect and, anyway, it's not as though Americans would lose.

Video

What about U.S. consumers? Their dollar's been plunging to record lows against the loonie and Euro in recent days. So are Americans feeling banged around by their weakening buck? Turns out.. No. The U.S. customer is still king. What gives?

Neil Macdonald reports for The National (Runs 3:53)

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