Subsidies are bad economics

Published on September 27, 2017

The U.S. Department of Commerce decision to impose a 220% levy on Bombardier's C Series planes is very bad news for the Canadian industry and workers.

But Ottawa is responsible for giving Boeing ammunitions against Bombardier.

The liberal government should never have given $372M in aid to Bombardier with undisclosed clauses that can be interpreted as a subsidy.

Subsidies are bad economics, unfair for taxpayers and other companies, and inefficient when trying to solve international disputes. It's true that Boeing and other aircraft manufacturers also get subsidies.

But Canada will never win a subsidy race with economies 10 times bigger than we are.

It's time to renegotiate an expanded ASU international treaty to limit government aid to aircraft manufacturers, as proposed by the MEI.