It seems that neither Airbus nor Boeing has had much more of an advantage than the other; considering both companies have been getting illegal subsidies from their government. While each country helps their airplane companies, they are also both complaining to the WTO that the other is cheating. It is unfathomable that this has been ongoing for close to 7 years now! There is nothing to dispute, each country needs to follow the rules and stop illegally subsidizing their airplane distributors, and move on. The WTO has better things to do than referee this trivial of a situation that should have been resolved by now.
These two companies (Boeing and Airbus) are the top two distributors of commercial jets in the world, and they are in a constant battle with each other to be number one. Could this seemingly never ending, childish dispute between Europe and the United States be causing the trade of goods between them to suffer? Its very possible. If they would stop accusing each other of the same crimes, they may be able to both benefit by becoming stronger trading partners, and trade larger amounts of goods with each other. This in turn may help to stimulate both economies.
http://wallstcheatsheet.com/stocks/battle-over-aircraft-subsidies-heats-up.html/
It is interesting to see these large competing companies fight each other for a crime they are both commiting. I understand that they each want to be the leader in their market, but as you said they should both be charged for the illegal subsidies and should end this childish dispute. However because the market is so competitive and each company is will to do whatever it take to get ahead, I think that the absence of these crimes will not help the trade between the companies.
ReplyDeleteI definitely agree with Brittany and Scott that it is a childish dispute, both the American and European officials involved in this dispute should grow up frankly. In this scenario, the fact is that European and the U.S. governments are each attempting to give their own aircraft manufacturer an unfair advantage over the other country's aircraft manufacturer. Since government intervention is present in the marketplace, though, and since each country has a different set of rules/standards governing trade, I'm not sure that government subsidies can necessarily be called a 'crime'. Governments subsidize goods all the time. I think the WTO exists to serve as a "one-size-fits-all" type of mechanism for setting singular trade standards/rules. The problem with the WTO is that there is no 'one-size-fits-all' way in which you could accurately set trade/standards without problems occuring, simply because different countries have different trading patterns, along with unequal amounts of trade. However, assuming that both the U.S. and Europe each care about the importance of trade with one another, I think that it is definitely important that they both take responsibility for what they did and make amends. I don't think it's appropriate for Europe to punish the U.S. by extorting $12 billion. Instead, U.S. and European officials should compromise and work together to avoid future disputes.
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