At the Farnborough international airshow last week, the four European countries with a big stake in Airbus — Britain, France, Germany and Spain — held a press conference to discuss why the subsidies they give to the aerospace giant are permissible under World Trade Organization rules. The statement they released was not true: the WTO has ruled twice now that most of the subsidies are illegal and must be withdrawn or restructured. Instead of complying with the WTO ruling, though, the four nations have launched a public-relations offensive aimed at obscuring the fact that Airbus (unlike rival Boeing) exists because of a 40-year pattern of market-distorting subsidies. In fact, the four countries recently gave Airbus additional billions of euros in illegal subsidies to develop a new jetliner its head marketer says is designed to render Boeing’s 777 obsolete. The patience of U.S. officials with Europe’s lies about its trade practices is at an end, and the U.S. Trade Representative is moving to secure authority from the WTO to impose punishing sanctions. I have written a commentary for Forbes that you can read here.
Find Archived Articles: