WTO Report on Boeing Confidential for...48 Minutes or So

Today the World Trade Organization released a confidential interim report on Boeing subsidies that the Wall Street Journal is already reporting criticizes payments to Boeing from the Department of Defense and NASA. And "without going into details," Ecology and Transport Minister Jean-Louis Borloo said, the report "finds in favour of the essence of the European Union's complaint."

UPDATE: Senator Maria Cantwell has issued a statement as well:

While I can’t discuss the details of the WTO’s preliminary ruling, I can say that the WTO panel rejected 75 to 80 percent of the European Union’s originally alleged subsidy claims. In dollar terms, the WTO found only a small fraction of the $20 billion in subsidies alleged by the EU. Most of those subsidies have long since been withdrawn. Importantly, the findings did not identify any existing prohibited subsidies, contrary to some media reports.

Allegedly unfair subsidies for Airbus and Boeing have been taking up a good deal of WTO staff time recently. France's stalwart defense of the WTO's ruling represents a marked shift since Airbus was found to have received some $20 billion in prohibited European subsidies in June. Then, the Wall Street Journal could find little WTO credibility on European shores:

Airbus officials said the EU would appeal the ruling. "There's not a single WTO case that hasn't been changed on appeal," an Airbus official said.

While on the one hand, the amount of aid appears roughly comparable in both instances (some $20 billion for Airbus and $24 billion for Boeing, which includes Washington state's tax breaks for the aircraft manufacturer), Boeing emphasized in a statement that there's subsidies and then there's subsidies.

In particular, Boeing objects to what it calls "launch aid"--low-interest government loans used to bring new planes to market. In a statement issued in advance of today's ruling, Boeing said:

Launch aid, which represented the lion's share of the involved illegal aid (roughly $15 billion), is unique to Airbus, unparalleled within U.S. industry, and – as the WTO has confirmed – harmful to U.S. aerospace interests and the American worker.

"To date, Airbus and its government sponsors have defiantly resisted abandoning launch aid. Media reports indicate that plans remain in place to provide billions of Euros of launch aid for the A350, a product that will compete with the Boeing 777 and 787. Unless that money is provided on full commercial terms, that would be an incomprehensible step in light of the recent ruling against launch aid and the outstanding obligation under WTO rules that Airbus repay the $4 billion in illegal launch aid it received for the A380, or restructure the A380's financing to proven commercial terms.

The interim report will remain "confidential" for some months, until a final report is issued, which results will likely then be appealed. The bystander likely feels some sympathy for the perspective of Peter Mandelson, formerly Britain's business secretary, and EU trade commissioner, when he inveighed against seeking a legal remedy that has cost "millions in legal fees and still promises no clear-cut solution."