Let me break this down in why The NAU is a bad idea.
First of all, let me make a example. If a Airline Company was the only company in existance, had no competition. What is stopping that company from doing whatever they want to the people who want to travel? They can adjust there prices as they see fit, making it ridiculously high. However if they had competition. That competition would be lowering its prices to attract more people to it's. As it does that, the other company will then lower it's prices to stop its customers from switching over and to attract more customers.
Competition keeps everything where it should be. While having a monopoly allows the company to do whatever it pleases.
Now for a fact, let's take both the current U.S. and Canadian Government.
What Bush did in Iraq and Afghanistan was shitty, further more all the secrets he kept from the American people and is still keeping. He pretty much feeds his power hunger and so far nothing has been done to stop it. It was left unti'll his term was ended to get him out of there.
Now for the Canadian Government, Stephen Harpers Government is by far the most secretive government Canada has ever had. He got is into Afghanistan, and further more most of the Canadian population doesn't even know why. Hes in so many scandals, etc. Hes also feeding his power hunger. Doesn't tell us anything about what is going on except for when he wants to say something.
Now, let's assume that we did this NAU Agreement. What's stopping that one leader of NA (Who has a monopoly of NA) from doing whatever he wants? Nothing, by doing NAU you are just setting up a monopoly for the leader of NA and giving him even more power by merging the Canadian and US Economy, resources and Military.
Now, what's stopping that leader from also merging NAU with EU? Again, the answer is nothing. He doesn't have any competition so he can pretty much do anything he wants with us. Remember those ID Cards that pretty much allows the Government to do whatever with your Identity? Guess what it's store for the new NAU

.
Indeed, what a great idea lol. If NAU does pass however, the only way it would work is if a new system was added where there is no ONE man in charge of the country. It would be several men who votes on actions regarding the country. Setting up competition once again.
A good idea would be to have the same election system in each country. U.S. has theres, Canada has theres, and Mexico has theres. Theres you three leaders right there, who vote on the actions NAU takes as a country.