Thursday, February 08, 2007

What It Could Have Been Matters

Today's WSJ reports:

"European Union officials hope Boeing Co.'s surging fortunes will complicate its efforts to stop government support for European rival Airbus. The EU today was expected to ask the World Trade Organization to examine Boeing's revenue recently, a time when the Chicago aerospace titan is resurgent, when considering a long-running trade dispute over aircraft subsidies. It hopes the more-recent results will demonstrate that European subsidies for Airbus aren't hurting Boeing." Read more here.

If your subsidies cause me to lose customers and lower my revenue as a result, the fact that now my revenue has increased does not mean that your subsidies have not hurt me.

The bottom line: Without subsidies Boeing could have earned more revenue than it has now. And yes, even after its recent surge. That is what matters.

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