On May 15, the World Trade Organization issued its final and definitive ruling on a case brought by the U.S. Trade Representative against European aircraft subsidies in 2006. The ruling is a huge win for Boeing, America’s biggest exporter, opening the way for Washington to impose billions of dollars in tariffs on European goods as a way of forcing compliance with trade rules. The WTO found in 2010 that every jetliner Airbus has ever brought to market was illegally subsidized, and directed European governments to desist. They failed to do so, and now have lost their last appeal before the trade body. Once Washington starts imposing tariffs on items held dearest by the Europeans, Airbus will probably lose its subsidies and for the first time since 1970 have to fly entirely under its own power. That will make it easier for Boeing to compete. I have written a commentary for Forbes here.
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