Volkswagen’s installation of software for circumventing emissions standards in at least 11 million cars worldwide is just the kind of thing that makes people think of “business ethics” as a contradiction in terms. It doesn’t help that the auto industry as a whole has a long and tarnished history of such behavior. From the hard-to-handle Corvairs that helped launch Ralph Nader to fame, to the exploding Pintos of the 1970s, to more recent examples involving ignition cutoffs, unintended acceleration, and malfunctioning airbags—defects their respective manufacturers often knew about but kept secret—sneaking substandard, potentially dangerous products into showrooms seems as much a part of the deal as offering undercoating. Not every recall notice is compelled by a government agency’s post-sale discovery of a sometimes deadly defect. But enough are to remind us why regulations and regulatory agencies are needed. Is this also the place to bemoan the rarity of severe and enforceable punishment, including damaging fines and criminal penalties?
A few things stand out about the Volkswagen revelation. First, it seems to many a kind of personal betrayal: Why did they do it? Timmons Roberts at the Brookings Institute gets to this, writing about his “long love affair” with VWs dating back to childhood, a love affair now soured. Anyone who grew up in or around families (or had college friends) with VW buses, or learned how to drive stick-shift in an old Beetle, would probably understand.
So maybe nostalgia played a part in the credulousness with which, as cost-conscious and environmentally aware adults, customers trusted the carmaker’s claims about fuel efficiency, clean-running engines, and higher performance in its newer diesel models. But you can’t have it all: such performance isn’t possible in a diesel vehicle also required to meet emissions standards. Thus software that intelligently activates emissions control only to get through a test, and automatically deactivates it once the car is back on the road, where emissions soar—“ten to forty times the legal limit of nitrogen oxide and nitrogen dioxide, pollutants that are extremely irritating to human lungs and that combine with other pollutants to create ozone and smog,” as Roberts points out. Volkswagen buyers may also have been softened by deceit, especially in Europe. The Guardian this week detailed the long campaign there by automakers to “incentivize” diesel “in the knowledge that its adoption would reduce global warming emissions but lead to thousands of extra deaths from increased levels of toxic gases.”
The scandal also reveals much about the place of automaking (and Volkswagen in particular) in German culture, business, and politics. Lower Saxony, the state in which the company is headquartered, owns about 20 percent of it and is “deeply involved with its affairs”, and deeply identified with the industry as a whole. The company’s corporate governance is apparently a mess — “a breeding ground for scandal,” according to one expert. And that the brand is practically synonymous with Germany could weaken the government’s claim to the moral high ground on matters like austerity on the one hand and compassion for refugees on the other.
Then there’s essential fact of what this is: cheating. Reports have noted that carmakers here and and even more so in Europe are generally trusted with providing their own proof of compliance, which doesn’t do much for actually ensuring compliance. Companies cheat because they can. Sometimes they resort to low tricks like removing back seats or stereos or anything else they can from test models to reduce weight and thus improve results. Sometimes they employ high tech. As detailed by Zeynep Tufekci in the New York Times, the Volkswagen case highlights the rise of what’s known as “cheating software” and how complacency about technology may raise issues about our own complicity in its effects:
We are rightly incensed with Volkswagen, but we should also consider how we have ceded a lot of power to software that runs everything from our devices to our cars, and have not persisted in keeping tabs on it. We correctly worry about hackers and data leaks, but we are largely ignoring the ramifications of introducing software, a form of intelligence, to so many realms — sometimes called the Internet of Things.
Low- or high-tech, cheating is cheating, and cheating on crucial standards, she notes, “is more than slight misconduct.” Volkswagen did wrong, and it’s been forced to come clean. But if you think about it, the signs were always there. Among the many choices available to consumers is to ignore such signs, or to pay attention to them.