Date: 03 Jan 97 04:36:35 From: jfmezei <firstname.lastname@example.org> Organization: SPC References: 1 2 3 4 5 6 7
View raw article or MIME structure
email@example.com wrote: > In general, I fail to understand the heat generated by this debate. My > Econ 101 said that subsidies/tariffs/etc were bad because of the cost to > the *host* economy Subsidies are bad when they sustain an industry which is endemically inefficient. They cost the nation money, and have no long term benefit since the industry will always be inefficient. Look at industries in the former East Block. Good example of the above. Air France might also be a good example, and now, they were told to shape up or die, they are trying to get fit ASAP before their subsidies run out. However, this contrasts sharply with a government investment in a startup industry which need a lot of cash to get going and shows long term promise of jobs and sustainability. (note: long term really means long term outside of North America). Aerospace industries get "subsidies" in one form or the other all over the world. If Airbus gets "more" subsides than the other guys, one must ask the question: "Can Airbus survive on only the "world average" amount of subsidies, and if so, how many years will it take for Airbus to grow/adapt to this". It is somewhat unfair to expect Airbus to have no government help whatsoever, and still let other manufacturers get benefits from government spending.