Is America still a serious nation?
Consider. While U.S. elites were denouncing Donald Trump as unfit to serve for having compared Miss Universe 1996 to “Miss Piggy” of “The Muppets,” the World Trade Organization was validating the principal plank of his platform.
America’s allies are cheating and robbing her blind on trade.
According to the WTO, Britain, France, Spain, Germany and the EU pumped $22 billion in illegal subsidies into Airbus to swindle Boeing out of the sale of 375 commercial jets.
Subsidies to the A320 caused lost sales of 271 Boeing 737s, writes journalist Alan Boyle. Subsidies for planes in the twin-aisle market cost the sale of 50 Boeing 767s, 777s and 787s. And subsidies to the A380 cost Boeing the sale of 54 747s. These represent crippling losses for Boeing, a crown jewel of U.S. manufacturing and a critical component of our national defense.
Earlier, writes Boyle, the WTO ruled that, “without the subsidies, Airbus would not have existed … and there would be no Airbus aircraft on the market.”
In “The Great Betrayal” in 1998, I noted that in its first 25 years the socialist cartel called Airbus Industrie “sold 770 planes to 102 airlines but did not make a penny of profit.”
Richard Evans of British Aerospace explained: “Airbus is going to attack the Americans, including Boeing, until they bleed and scream.” And another executive said, “If Airbus has to give away planes, we will do it.”
When Europe’s taxpayers objected to the $26 billion in subsidies Airbus had gotten by 1990, German aerospace coordinator Erich Riedl was dismissive, “We don’t care about criticism from small-minded pencil-pushers.”
This is the voice of economic nationalism. Where is ours?
After this latest WTO ruling validating Boeing’s claims against Airbus, the Financial Times is babbling of the need for “free and fair” trade, warning against a trade war.
But is “trade war” not a fair description of what our NATO allies have been doing to us by subsidizing the cartel that helped bring down Lockheed and McDonnell-Douglas and now seeks to bring down Boeing?
Our companies built the planes that saved Europe in World War II and sheltered her in the Cold War. And Europe has been trying to kill those American companies.
Yet even as Europeans collude and cheat to capture America’s markets in passenger jets, Boeing itself, wrote Eamonn Fingleton in 2014, has been “consciously cooperating in its own demise.”
By Boeing’s own figures, writes Fingleton, in the building of its 787 Dreamliner, the world’s most advanced commercial jet, the “Japanese account for a stunning 35 percent of the 787’s overall manufacture, and that may be an underestimate.”
“Much of the rest of the plane is also made abroad … in Italy, Germany, South Korea, France, and the United Kingdom.”
The Dreamliner “flies on Mitsubishi wings. These are no ordinary wings: they constitute the first extensive use of carbon fiber in the wings of a full-size passenger plane. In the view of many experts, by outsourcing the wings Boeing has crossed a red line.”
Mitsubishi, recall, built the Zero, the premier fighter plane in the Pacific in the early years of World War II.
In a related matter, the U.S. merchandise trade deficit in July and August approached $60 billion each month, heading for a trade deficit in goods in 2016 of another $700 billion.
For an advanced economy like the United States, such deficits are milestones of national decline. We have been running them now for 40 years. But in the era of U.S. economic supremacy from 1870 to 1970, we always ran an annual trade surplus, selling far more abroad than Americans bought from abroad.
In the U.S. trade picture, even in the darkest of times, the brightest of categories has been commercial aircraft.
But to watch how we allow NATO allies we defend and protect getting away with decades of colluding and cheating, and then to watch Boeing transfer technology and outsource critical manufacturing to rivals like Japan, one must conclude that not only is the industrial decline of the United States inevitable, but America’s elites do not care.
As for our corporate chieftains, they seem accepting of what is coming when they are gone, so long as the salary increases, stock prices and options, severance packages, and profits remain high.
By increasingly relying upon foreign nations for our national needs, and by outsourcing production, we are outsourcing America’s future.
After Munich in 1938, Neville Chamberlain and Lord Halifax visited Italy to wean Mussolini away from Hitler. The Italian dictator observed his guests closely and remarked to his foreign minister:
“These men are not made of the same stuff as the Francis Drakes and the other magnificent adventurers who created the empire. These, after all, are the tired sons of a long line of rich men, and they will lose their empire.”
If the present regime is not replaced, something like that will be said of this generation of Americans.
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