Boeing disclosed Wednesday that it will have to eliminate at least 4,000 positions at its commercial aircraft operation this year, and maybe twice that number as the operation strains to stay price-competitive with rival Airbus. Boeing jetliners are generally more advanced than their Airbus counterparts, but Airbus often prices its offerings lower so Boeing needs to cut costs to the bone. One item missing from media coverage of the cuts is how the federal government has made it harder for Boeing to stay in the game. First, it has failed to punish illegal trade subsidies provided by European governments without which Airbus might not even exist. Second, it has failed to sustain a functioning export credit agency even though every other major trading nation has one and the current agency, Ex-Im Bank, costs taxpayers nothing. Third, it has purchased military derivatives of Boeing’s jetliners in a fashion that weakens the financial capacity of the enterprise to compete with Airbus. And then there is the fact that America has the world’s highest corporate income tax rate. I have written a commentary for Forbes here.
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