When does a subsidy warrant investigation? Answer: When a powerful trading nation has something to gain from being indignant. The pending court battle over state subsidies for the world's two biggest aircraft manufacturers - to be adjudicated by the World Trade Organisation - really defies belief. This is so because fiscal support of one form or another has propped up the aviation industry since its inception. It would be almost laughable if European Union and United States taxpayers weren't ultimately going to foot the bill for the armada of lawyers who will spend the next three to four years fighting for a decision to which neither side intends to adhere. And it would also not have become an issue if all those subsidies, soft loans, research and development grants, tax incentives and big brown bags full of cash hadn't funded some spectacular new aircraft. The US filed for 'consultations' - the first step in the WTO arbitration process - in October last year, right around the time when the hoopla surrounding Airbus Industrie's launch of the futuristic A380 was reaching its peak. Boeing was smarting from losing its title as the world's No1 aircraft manufacturer to Airbus and appeared to be nowhere near hitting former chief executive Harry Stonecipher's goal of selling 200 new B787 Dreamliners - its competitive response - by the end of the year. The dispute faded for a while after sales in the B787 picked up substantially, partly because it is a good product, but also because Airbus's response - the A350 - was not yet competitive. The trade waters remained calm until Airbus lost a couple of deals - Air Canada chose 14 B787s when the cheque was rumoured to be already in the post for Toulouse - and sent the A350 back to the drawing board to tweak up a stronger product. 'We needed to lose a couple of deals to sharpen our attention,' a senior Airbus official told Below Deck in Tokyo this week. 'Some good probably came of that because the product we had planned to bring to market probably wouldn't have been very competitive.' But the spark that brought the dispute to formal arbitration was when John Leahy, Airbus chief commercial officer, said he hoped to announce 100 orders for the A350 this month at the biennial Paris Airshow. That, of course, could derail the growing sales impetus of the B787. Yes, in between, Airbus offered to scale back by 33 per cent the Euro1.3 billion ($12.4 billion) it had requested from its four European stakeholder countries - and the Americans feigned outrage that Airbus lacked commitment to completely eliminate subsidies, as if they themselves would not support such a move. However, that was little more than good drama, acted out in the court of public opinion. There has since been a lot of spin-doctoring. And, as ever with spin-doctoring, some home truths can be found between the lines. 'Commercially, Airbus is a huge success,' EU trade commissioner Peter Mandelson (pictured) said in a statement this week. 'This is why Boeing has been so instrumental in bringing this case to the WTO, not because it fears subsidy but because it fears competition.' The first part is absolutely true, which begs the question why Airbus continues to seek launch aid. The second part is also probably true, but Mr Mandelson neglected to mention that the same can be said of Airbus. Both will use whatever resources - ethical or otherwise - available to them to tilt the commercial playing field in their favour. I believe that's called free enterprise. But all this dancing is not about either side's fundamental or ethical objections to soft money - hell, they thrive off it. It is about using the facade of WTO arbitration to gain a temporary competitive advantage at the taxpayers' expense. For either side to pledge allegiance to the sanctity of the ideals of the WTO - such as free trade - is hypocrisy personified. It is, after all, the same two trade blocs that apply and remove tariffs and quotas like Band-Aids whenever cheaper, Asian-made products flood their shores. Subsidies, rightly or wrongly, have been a way of life in the aviation business since the Wright brothers took to the air in 1903. Neither the European Union nor the United States fundamentally objects to them, nor is either likely to observe a WTO ruling that doesn't go their way.