VW chose profit over the planet
Volkswagen promoted itself as a "green" corporation for the same reason that it circumvented emissions regulations, explains.
IT'S ONLY been a week, but it's already being dubbed one of the biggest-ever corporate scandals.
Volkswagen, the world's largest auto manufacturer, was recently caught rigging millions of its cars to cheat on emissions tests. Software known as "defeat devices" was installed in more than 11 million cars that enabled the vehicles to pass emissions tests they would otherwise have failed. The illicit devices detect when a car is being tested and direct the engine to pump out far less pollutants--98 percent less--into the air than they ordinarily do when on the road.
The fallout has been swift and profoundly damaging for the company. In a single week, more than a quarter of the company's total value of shares has been completely wiped out. Governments in Germany and the U.S. are already promising to impose heavy fines--some sources say the total amount could add up to as much as $10 billion to $20 billion. Executives have resigned, sales have been suspended, and a massive recall of rigged cars looms large.
Of course, if you were to take the VW brand's self-image at face value, these revelations would come as something of a severe shock. Volkswagen has spent the last several years cultivating a public image that evokes precision, efficiency and ecological sensitivity--VW's are "clean, quiet and powerful" as a recent advertisement put it.
The company has courted millennials with talk of "clean diesel technology." Indeed, before the scandal broke, VW was held up by the Dow Jones Sustainability Index as the "greenest," most environmentally conscious carmaker in the world. This is only one of many awards that the company has racked up over the years for its supposed commitment to ecological sustainability.
No doubt much of the public outrage directed at VW owes to the contradiction between the company's "green" reputation, on the one hand, and its systematic engagement in fraudulent polluting, on the other. As more and more information about the company's decision-making comes to light, the easier it becomes to see the matter in purely ethical terms, as a case where greed blinded those at the top.
The public will be encouraged to conclude that this scandal is the result of cynical, deceptive actions on the part of a few corporate executives--"a few bad apples"--at the top of Volkswagen. But thinking about the issue in this way would be a mistake, since it would lead us to overlook the larger, systemic problems with capitalism that this scandal reveals.
WHAT ARE some of those systemic problems? First, this scandal exposes the bankruptcy of a reigning illusion of our era--that we can change the world simply by changing our consumer habits. These revelations shatter the myth that environmental destruction can be averted by way of "progressive consumerism" whereby we simply have to "vote with our dollars" to achieve a greener, more sustainable economy.
The opposite might seem to be true given that VW's stock plunged after the scandal broke. Isn't this evidence that bad environmental practices are bad for business? Not exactly. Investors aren't bailing because of environmentalist sympathies--they're selling off their shares because negative press, fines, suspension of sales and product recalls are all bad for business.
Put another way, it's unlikely that fleeing investors are reallocating their resources to Greenpeace as a result of this scandal. And this is to say nothing about the consumers who bought VW's on the (mistaken) assumption that they really were making an environmentally friendly purchase. In their case, the "buy green" mantra did no good for the planet whatsoever.
Simply put, buying this instead of that doesn't change the fact that capitalism is driven by one overriding consideration: profit.
The groups pedaling fantasies about righteous consumer activism are often the same ones lying through their teeth as they sell products that harm the planet. In the case of VW, the company consciously carved out a niche as a "green" manufacturer for the same cynical reason that it put the "defeat devices" in its cars in the first place: to make as much money as possible.
We'd be naive to think that VW is unique in this regard--the odds are that competing carmakers had plans to engage in--or were already engaging in--the same sort of dirty dealings. Perhaps the real scandal is that we're routinely told that the very corporations destroying the environment are, in fact, the ones leading the charge for sustainability and environmental justice.
It's also important to point out that this is hardly the first time a major corporation--or, for that matter, a major car manufacturer--has systematically lied to consumers to maximize profit. The problem is built into the fabric of capitalism.
To take a particularly egregious case--and there are many to choose from--recall that in the 1970s, Ford executives decided that it would be better to continue to make a car (the Pinto) they knew to be highly unsafe for another six years instead of fixing the problem and losing serious market share to foreign compact-car makers. They calculated that there would be at least 180 deaths a year from exploding Pintos, but they expected the monetary costs of settling those cases with the victims' families to be less than the profits they'd lose if they stopped production and redesigned the car.
BY ALL accounts, VW executives were employing similar reasoning when they decided to cheat on emissions tests. They simply did what the system encourages capitalists to do: ruthlessly, relentlessly chase after ever-greater profits. Competition in the marketplace puts enormous pressure on individual capitalist firms to cut corners and reduce costs wherever possible--even if this means sacrificing human lives and the environment or breaking the law.
A firm that fails to cut corners invites being forced out of business by other firms that do. The result is a race to the bottom whereby corporations routinely sacrifice the ecological health of the planet for the sake of expanding their market share and profits. Thus, what is often held up as capitalism's defining virtue--its emphasis on unplanned, vigorous competition for profit--turns out to be the cause of some of its worst effects on humanity and the planet.
It's unclear what will come of this growing scandal, but hopefully the outrage over VW's massive "greenwashing" campaign will lead greater numbers of people to raise deeper questions about capitalism and the environment. Rather than focusing on the culpability of high-ranking individuals at VW, important though that is, we need to ask more fundamental questions.
Why did anyone ever think that profit-seeking corporations like VW, egged on by global competition, would prize environmental sustainability more than their own bottom line? Why did anyone think that an industry devoted to maximizing the number of people driving private cars and burning fossil fuels should be entrusted with the ecological future of the planet? And why aren't we asking how to produce fewer cars in the first place and invest more labor and resources in public trains, streetcars, buses and bikes?
It's unlikely that we can give convincing answers to these questions without, at the same time, raising serious doubts about the prospect of meeting the environmental challenges we face within the narrow confines of a system based on profit.