(Had to cut and past from the digest) First, Evan, thanks for pointing out the analogous examples...I was aware of them, just trying to back myself up a little ;) The government isn't investing only because it's the only entity willing to invest so much money (even then, I'm not sure of the facts) but what my thought is: Is it in France's best interest to NOT help Airbus out with the A380? Ever since Airbus' beginnings, it was helped by the government(s) because it needed it, it needed the financial and moral support from the governments to be able to grow. Airbus didn't become a fully integegrated company (stockholders etc.) until 2001, so it really is just beginning without some sort of help from the government. I guess they just haven't gotten that far from separating themselves from their "parents". -Chris <<Date: Sat, 16 Mar 2002 11:44:09 -0500 From: Evan McElravy <emcelr@po-box.mcgill.ca> Subject: Re: those repayable loans > - Remember these are REPAYABLE loans. Airbus WILL > still be required to pay back the loans. They're still > paying back loans given to them years ago, so it's not > like the government is just giving them money. Well, there the devil is in the details. Would Airbus have gotten such a loan from a bank, or was the government the only willing creditor for the project (which is enormously risky)? If the former, is Airbus paying a bank rate with bank terms to the government of France, or are they getting the aerospace equivalent of Detroit's zero financing? If the answer is no to either of these questions, then, in some sense, the French government is "just giving them money." If we're all free-marketers now (and of course we're not), what's it to the French government whether Airbus competes with Boeing in the plus size airliner market or not? > (On a side note, do you think the European airlines > are happy that our US-carriers received all that > money, never to be repaid back to the gov't?) No, I'm sure they're not. And as an American, I'm not real happy either with this use of the national purse. I don't think it was very necessary, and will probably just prop up airlines that were already failing pre-9/11 for a little while longer. But having said that, these are not analogous situations. The fact that Europe does not manufacture a jumbo jet is not the same sort of problem as having the air traffic system of the United States shut down by government order for three days following an armed attack on our largest city. > - What's it to us if they do this under the table or > not? Boeing does receive indirect help from the > government via the military. Give Boeing a military > contract to develop some planes and who's to say where > the money from that program goes to? Once again, not analogous. Military contracts are sweetheart deals of the highest order, no doubt, but Boeing _is_ actually selling something to the government (usually!). For that money, they do actually have to manufacture x number of KC-135s or Chinook helicopters or whatever. They just don't send the check over to the commercial aircraft division to invest in a new 747 derivative, whatever the paranoid fantasies in Toulouse. I'm sure that Airbus would love to sell military hardware to the various European armed forces, but of course - with the qualified exceptions of Britain and France - Europe has chosen to keep armies about as well armed as the Girl Scouts. Doesn't Airbus offer a military transport that not a single country in Europe has expressed any interest in at all? It's an open secret that European security is guaranteed by the American taxpayer, which is certainly a good deal if you can get it. But when these governments, which mostly buy what military hardware they do have from U.S. contractors, including Boeing, turn around and say this amounts to an unfair subsidy for American commercial aircraft manufacturers, it's a little hard to take with a straight face. > I'm not pulling all this out of nowhere, just some > thoughts because last week, I turned in an 80-page > senior thesis on the privatization of Airbus as being > the key element to its success in the commercial > aviation market. Yes, quite right. But if they're still needing loans from Uncle Jacques, they've got a long way to go yet. Evan McElravy emcelr@po-box.mcgill.ca http://users.penn.com/~cpa1/>> ===== -Christopher Liao Pawtucket, Rhode Island Wooster, Ohio ================================ http://pages.wooster.edu/liaocl/ __________________________________________________ Do You Yahoo!? Yahoo! Sports - live college hoops coverage http://sports.yahoo.com/