Boeing vs. Airbus

Boeing vs. Airbus

Clash of the Corporate Welfare Titans
July 14, 2005

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The United States and the European Union (EU) may be on the brink of the largest trans-Atlantic trade war ever. At issue are government subsidies for the makers of passenger jets—Boeing in the U.S. and Airbus in Europe. 

Both sides claim the moral high ground in this dispute, but in fact governments on both sides of the Atlantic heavily subsidize their jet makers. Washington launched this dispute, even though Boeing may be the largest beneficiary of corporate welfare in the U.S. Meanwhile, Airbus resembles more a government agency than a private business.

The Dispute. On May 31, 2005 a year of negotiations between U.S. and EU trade officials escalated into the first stages of a trade war when U.S. Trade Representative (USTR) Rob Portman asked the World Trade Organization (WTO) to step in, requesting the WTO establish a dispute settlement panel.