OK, I know, I'm not going to make everyone happy here and I'm not going to find anyone who agrees with me completely. Keep in mind, I'm a godless rationalist and the following ideas and thoughts reflect that.
The first thing that I would do is amalgamate Canada and the USA politically, with an eye towards Mexico in the next 50 years. Canada and the USA share the same Western ideology, and philosophy. There is no need to have a political border between the two nations. Culture can still be maintained, just like the South in America has a different culture from the American nomadic-like individual who lives in Buttswipe, Minnesota.
Now the issues(easy ones first):
Prostitution
Legalize it. Regulate it. It is a reality. The government should make money off it, and the health of the prostitutes should be monitored regularly. Most sex is about prostitution anyways, whether it is has to do with marriage, pre-marital dating(when the woman tries to hook the man). Whether it is an emotional gain or materialistic gain, it is prostitution. Sex driven by biogical reasons only does happen, but it isn't the main reason two people are together for more than a one or two night stand.
Gambling
Legalize it. Again, the black market on gambling is huge. It is going to happen regardless. Everyone knows that people are betting, whether it is with old fashion bookies or new fashion internet bookies. The government should be in on it. Back when there weren't any offshore houses, at least the money would stay in domestic hands, but now it leaves the country. It is ridiculous for this to happen. If it becomes regulated and legal, at least problem gamblers can be spotted quickly and helped.
Drugs
Legalize pot. Keep alcohol legal. Life sometimes is harsh and we need to escape every once in a while if we choose to. Myself, I hardly ever drink. I used to when I chased skirts. I have other means of escape, but I don't want to deny the less creative. Heroin and cocaine should be dealt with severely. The drug dealer and importers should be looking at a minimum of five years for a first offense. The users should get a 3 month sentence for a first offense in a drying out jail(different than a regular jail full of actual criminals). Second offense would be a year. Cocaine and heroin can kill you immediately. Illegal. Drunk drivers should be jailed 3 months, no questions asked for a first offense. And 2 years for a second offense. A universal test will be needed for those who drive stoned, and they should receive the same sentence as drunk drivers.
Death Penalty
If you murder a stranger, you get the death penalty and or if you murder a child not in your immediate family, you can get the death penalty. These are cold blooded murders in my books. Emotionally driven murderers (and I'm not calling terrorist acts emotionally driven) should receive 30 years to life.
If someone rapes a child(this includes any adult having sex with anyone 12 or under), they get 30 years to life. No exceptions. Not even for Priests.
Abortion
The world has enough unwanted children, but I'm not going to use this as the basis for my belief here. Any stance on abortion is considered contraversial these days, but everyone has a stance.
I believe that if the woman can live with her decision to abort a fetus, it is her choice. I consider any living being that can't survive outside of the womb and grow up without expected defects to be abortable. According to what I've read on the subject, I am comfortable with 26 weeks. After 26 weeks, no abortions. But there is no law that prevents a pregnant woman from going skiing or sky diving or falling down a flight of stairs(wink wink).
Separatation of Church and State
No religion in public schools. None. Zero. No homeschooling either. We don't need kids to grow up thinking the sun revolves around the earth. If you want religion in school, there are private schools, there is also your house of worship. If you don't have enough of a population to have a private school for your specific religion, move to a country that does. No, Sikhs cannot bring hatchets to school because of religious freedom. Christmas and Easter are to be grandfathered in as holidays. It will still be OK for kids to hand out Christmas cards (as long as they dont contain anti-semitic messages) and Valentines day cards (kids need to deal with the reality that they may not receive one if they are an unlikable sociopath. It is a good lesson in life).
Taxation and a Paperless Monetary System
The future is here. Start implementing this now. Fingerprint and/or wrist chip technology should be used for ALL financial transactions that are not done on-line. Pin numbers will still be needed to keep the hackers (limb hackers that is) away from identity theft.
Personal taxes and business taxes should not be brain surgery. My idea is to have government regulated approved expenses and other deductions for every type of job imaginable and every type of business imaginable(this will keep the government busy as they have to approve what is what for each case if something new is brought up). All transactions will fall into the specific individuals own expense categories (personal living expenses versus expenses related to business, which come off gross income). Every transaction falls into one of the categories. At the end of the year, the government emails you a statment on much you owe. It will be a straight 20% of earned net income (yes, you still get to deduct Retirement Savings as against gross income). All welfare checks will have the 20% deducted at source.
A person can have multiple business accounts if he or she has different sources of income. Different pins are needed for these accounts because the deductions will be different. Corporations will be dealt with the same way as an individual. A straight 20% tax on net income. No off shore tax deductions will be allowed for corporation or individual.
All goods and services will have a 10% tax as well. No exceptions. Native Indians included.
Privacy
Since the government already knows all your transactions(see above), they can react accordingly based on any red flags that may come up. This should curtail terrorist funding and other black market dealings. I guess the door is open for barterring (drugs for guns, for example), but again, any unusual types of transfers or purchases will warrant a red flag. And I give the government unlimited power to act against suspicious activity.
Immigration
I'm realistic enough to know that 30,000 years from now, if man is still around, every human alive will probably have olive skin and slightly slanted eyes. The society will be mainly agnostic and atheist. But this isn't 30,000 from now. People are still upset over cultural and/or racial differences, especially if someone wants to come over here an impose their own cultural dogma on us.
Immigration should be related to current employment levels. If unemployment rates are too high, immigration should cease until they decline.
All immigrants need to sign an oath stating they know they will be kicked out immediately if they commit any criminal act that has a sentence of one year or more attached to it and they will comply with all rules in place on the date of their arrival. This is a lifetime contract.
War on Terror
At this present time, Radical Islam is an immediate threat to Western civilization and the future of life on this planet. We can not sit idly by and wait to be attacked. Their fairly young dogma must be changed. Their culture must be reformed.
Eskimos don't need their culture reformed, but the Muslim world does. Until such a reform occurs, the War on Terror is a top priority.
Health Care
This is where a good chunk of your tax money will go. And I am not against having a tiered hospital set up either. If you can afford it, you are free to seek premium care. But basic needs will be payed by the government(Canada's system).
Trade
Outsourcing and trade is a problem. I think the only way around it is to impose more significant tariffs. Domestic jobs need to be protected at all costs. Canamerica can not continue to be a Sugar Daddy for the rest of the world. Aid should be cut off except in humanitarian circumstances. Any region that welcomes terrorism should be exempt from aid.
Gay Marriages
If gay people want to get married, let em. Really simple. What is marriage any ways? The highest divorce rates are found amongst the most religious. Now since I'm allowing for gay marriages, can you guys stop kissing in public? I just don't like looking at it. It isn't a law or anything. Just do me a favor. Thanks. Oh yeah, women you can keep kissing in public, that's cool.
Censorship
TV stations, radio station and newspapers can either choose to have adult content(cursing and/or nudity) or not have it. Just let the religious goody two shoes know ahead of time that a certain TV station may show a nipple at any given time so that they can channel block it if they choose.
I'm also pro-cum shot too when it comes to late night TV. Why hide it? It's a reality. Put it on Fear Factor. It would be fun.
OK, now you know where I stand and what I would do if I was Supreme Ruler of Canamerica. Like the good Atheist that I am, all the above is subject to change based on new information. It was a constant flow of new information, that turned me from an assumptive believer in god to a proud non rigid Atheist in the first place.