Volkswagen, Germany’s largest company, caused possibly the biggest scandal in German economic history. The full consequences can still not be foreseen. The workforce is concerned regarding their future. The financial damage due to penalties and compensation is inestimable but certainly gigantic. And wider business fear losses due to the damage done to the image of German products.
Perhaps the full scale of the consequences of the scandal will be seen on the international and political scales: The German government constantly plays the role of ‘head teacher’ or, to be more exact, disciplinarian, in Europe. Its ruling establishment effectively says “We show everyone how it’s done right”. Greece was brought to heel and subjected to moralistic wagging finger – “contracts must be honoured”. Now the Volkswagen scandal means this ‘authority’ is damaged.
Socialists should learn from the scandal and find a solution in the interests of the environment and the workforce. Anyone expecting the company and the government to do this is going to be disappointed. A solution requires nothing less than a radical change in society.
The VW scandal raises many serious questions:
How did VW think they could deceive the whole world?
There are basically two reasons for this. One is simple habit. The whole automobile industry is used to being able to deceive the public without any consequences. Every driver knows that fuel consumption levels are much higher than the official figures. This can be proved simply by looking at your fuel costs and the mileage of your car. With the toxic nitrogen oxides (Nox) from diesel engines, it is a bit more complicated. But even here there is evidence. The International Council on Clean Transportation writes: “The legal limits for Nox emissions from diesel cars in the EU were lower by 85% between the years 2000 (‘Euro 3’) and 2014 (‘Euro 6’). Euro 3 to Euro 6 are European emissions norms, Euro 6 is the one currently in force). In the same period of time, the actual level of Nox emissions went down by only 40% and are seven times higher than what is actually allowed by Euro 6.(real emissions behaviour of modern diesel vehicles). Therefore, the actual emissions levels have been way above legal limits for years, without any consequences, because the legal limits only have to be achieved under test conditions.
Why did VW go beyond the confines of normal deceptions and manipulate the results even more? Tougher legal limits in the USA could not be achieved even under known test conditions without costing more money, VW feared losing ground to competition in the fight for sales and because problems and solutions cannot be openly discussed within the company (as in other companies too) but are dictated from above. Engineers and managers who expressed doubts, were allegedly shouted down with the refrain, “No is not an option”. An insider told Focus online magazine (29.09.2015), “Even when a project cannot be completed in the allotted time, nobody dares to ask for more time.” In short, VW is dominated by the exact same conditions that many working people know from their own place of work.
The role played by senior shop stewards and top trade unionists in the company is also important. “Members of the Works Committee were bribed by company executives with money, luxury holidays and services of prostitutes, and in this manner their decision-making was corrupted” claimed a Wikipedia article about a VW corruption scandal in 2005). Peter Hartz, former head of personnel at VW (and initiator of the Hartz laws) was convicted of embezzlement in connection with this scandal. The former IG Metall union chairman, Berthold Huber, is currently acting-chairman of the board of supervisors of Volkswagen.
Why do the political powers that be not proscribe a realistic emissions test and stricter monitoring? Because the tail does not wag the dog. The German car lobby is one of the most powerful and influential lobby groups in the country. Under pressure from the car lobby, Merkel prevented an already agreed European compromise to reduce climate-harming emissions in 2013.Laws and Regulations concerning the car industry were sometimes written by their representatives and adopted almost word for word by the government. The connections between the car industry and politicians are close, and in the case of VW traditionally, closer still. Karl Marx wrote in the middle of the 19th century, “Legislation, whether political or civil, never does more than proclaim, express in words, the will of economic relations” (The Poverty of Philosophy)
What is the root cause of the automobile industry having so much influence?
The automobile industry is a key industry worldwide. Its rise defined the 20th century. The spark plug ignition engine, the diesel engine and the car were all invented in Germany. In terms of turnover, the automobile industry is, by far, the most important sector of industry in Germany. German car manufacturers produced 15 million cars across the world last year.
What is the problem?
The manipulation of the emissions levels was about fulfilling strict US limits for nitrogen oxides under test conditions and on a test bench (and only on a test bench). The software built into VW engines recognises that a car is on a test bench (because the car is not moving, despite the wheels turning) and switches the engine and the exhaust gas cleaning into a special mode. This occurs at the expense of engine performance and consumption of a special additive (AdBlue). During actual driving, the nitrogen oxide emissions are 35 times higher than the legal limit. These limits have been made stricter over the last few years because nitrogen oxides are dangerous in a number of different ways. They irritate and damage the respiratory system and reduce lung function. Nitrogen oxides from motor exhaust fumes also lead to increased creation of ground-level ozone, which is also an irritant gas. They also cause acid rain that damages forests and plants.
What could the solution be?
It remains to be seen if there will be a technical solution, at least for some of the eleven million cars that are on the road with the manipulated VW software. What is certain is that the European legal limits are not being adhered to, in reality, even if they are fulfilled on the test bench (which is all the current laws ask for). From a technical point of view, it would be possible to fulfil the legal limits. This is the conclusion reached by the ICCT mentioned above. When it tested 15 modern diesel vehicles by different manufacturers under real conditions, it reported that “some of the vehicles tested showed average emissions below the Euro 6 limits, which demonstrates that the technology required for fulfilment of the legal norms under real conditions already exists today”.
The solution goes beyond the production of cars
Whether three-litre, hybrid or electric cars, all solutions being discussed take for granted that the car will remain the number one means of transport. This would mean continuing and worsening a catastrophe. A few facts regarding the car industry:
- Over 3,000 people die on the roads in Germany every year
- Around 400,000 people are injured in accidents every year
- According to research and estimates by the World Bank and the World Health Organisation, between 1 million and 1.2 million people worldwide die as a result of traffic accidents, every year. The number of road deaths is higher than the number of people killed in wars (Wikipedia)
- In Germany, the risk of death is 58 times higher when travelling in a car, compared to when travelling by train.
- The probability of an accident is 111 times higher per car journey than it is per train journey (based on number of kilometres travelled by a person).
- Motorised traffic pollutes the air, is highly damaging to the climate, takes up space in the cities and wastes our time in traffic jams.
- Car manufacturing puts a strain on the environment. Sixty seven million cars were built worldwide in 2014, and the number is set to rise.
A different transport system
So the solution cannot be simply about making more cars. With the technological possibilities of the 21st century, it would not be particularly difficult to fulfil the desire for individual mobility using buses and trains, in a safe and environmentally friendly manner. This would also be cheaper because the costs of building and maintaining roads, the cost of air pollution and the material losses of traffic accident victims, as well as the loss of (working) time due to traffic jams, all have to be added in when considering the true cost of travelling by car.
A transport system that serves the interests of humans and the environment could only be achieved against the bitter resistance of the car companies and associated industries. One hundred years’ experience with the car industry shows that it is only possible to change it by breaking its power. This means taking transport into public ownership under democratic control and management. On this basis, and on the basis of a broad discussion in society, production could be transformed towards public transport.
Who should pay?
The top managers and major shareholders who are responsible should be made to pay for the damage caused. After all, princely sums paid to top managers are always justified by referring to the huge responsibility which goes with such positions, while the dividends enjoyed are justified as a reward for entrepreneurial risk. Well then, now is the time to face up to the responsibility and the entrepreneurial risk. The VW workforce was not taking the decisions. Staff on temporary contracts should not be made redundant while the former VW boss, Winterkorn, has a multi-million euro fortune to fall back on and might even get a golden handshake, as well.
Who should investigate?
Volkswagen has damaged not just itself as a company but society as whole, particularly since the air that we breathe has been and is being polluted even more. Therefore, there is a public interest in an investigation into the VW scandal. All internal documents must be made public. VW should not be allowed to invoke the notion of ‘trade secrets’. After all, a criminal is not allowed to invoke the right to privacy in order to prevent his home from being searched.
A commission of enquiry must not be put in place from the top but rather by the grassroots. For example, representatives of the VW workforce could be elected at a works’ meeting and there could also be elected delegates from environmental organisations and organisations with a proven record of being critical towards the motor industry, such as PRO BAHN (which speaks on behalf of rail passengers). Other car manufacturers must also be investigated and all the results published. The scandal should also provide cause to clean up all the structures and connections between union officials and management. An average wage for union officials, re-imbursement of expenses and all monies above and beyond this to be handed over to the union; officials to be answerable to the membership and subject to recall at all times, all of these measures need to be enforced. This scandal in Germany’s biggest company, part of the most important sector of Germany’s economy, only serves to show, in a particularly clear manner, the consequences of an economic system in which the motive for production is not the well-being of people and the environment but rather increasing profits. We have accustomed ourselves to regarding this as ‘normal’, but it is anything but. Or, to put it differently: Normality is the scandal.