If VW had merely killed innocent consumers by putting in faulty switches, they’d have been fine. No problem. Sorry, simple mistake. But play with the golden God of Carbon emissions? Now you have a problem.
I received an E-mail the other day from a reader, after I mentioned the incredible fines that were going to be placed upon Volkswagen for fiddling with their emissions software: Dear Bob, I have a question: Why is the US currently massively fining European institutions and companies? Is there a history to this or is it 'new'? Maybe you could explain this in detail in one of your newsletters. Kind regards and thanks, Patrick.
I can indeed Patrick. Let’s follow a couple plots here. First I want to start with General Motors. GM went ahead and put cars on the road that they KNEW had faulty ignition switches. A lousy 1 dollar part, but a part so incredibly important, that if it failed, your car shuts off. No power, no airbags, no power brakes, basically a car coasting along.
The big problem I have with it is that GM KNEW they had a problem. But they selling cars, and didn’t institute a recall. Depending on who’s numbers you want to use, the confirmed deaths range from a low of 129, to over 300 because of failed air bag deployment in crashes. The bottom line is that people died in cars produced with a KNOWN defect.
Let’s see what the Director of Auto safety had to say…. “GM killed over 100 people by knowingly putting a defective ignition switch into over 1 million vehicles. Yet no one from GM went to jail or was even charged with criminal homicide,”
“This shows a weakness in the law, not a weakness in the facts,” he said. “GM killed innocent consumers. GM has paid millions of dollars to its lobbyists to keep criminal penalties out of the Vehicle Safety Act since 1966. Today, thanks to its lobbyists, GM officials walk off scot-free while its customers are 6 feet under.”
- Clarence Ditlow, executive director at the Center for Auto Safety.
So, General Motors gets to kill people, and guess what their Fine was? 900 million dollars, no criminal penalty and a promise to do better next time.
Let’s move along… Fortune magazine reports: On Monday afternoon, Thomas Lund [one of the highest ranking former officials of Fannie Mae] settled charges brought by the Securities and Exchange Commission back in 2011 that he helped deceive shareholders of Fannie Mae in the run-up to the financial crisis.
The suit claimed that Lund, who was the head of Fannie’s single-family division, helped hide more than $100 billion of subprime exposure from Fannie’s shareholders, allowing it to continue to back more and more risky loans.
Now, just like Bill Bonner explained, Thanks in part to Mr. Lund’s chicanery, the bubble in mortgage finance caught investors unaware. This resulted in losses of at least $8 trillion in the U.S. stock market alone.
Mortgage debt had become a key component of Wall Street collateral. When housing prices fell, many of the big banks were faced with insolvency. Arguably, in September 2008, this brought the entire financial industry – and the world economy to the edge of collapse.
Losses in the housing market were colossal and came with great personal suffering. We don’t remember the number. But something like 10 million households found themselves “underwater,” with mortgage debt in excess of the value of their houses.
Millions of people lost their homes when lenders repossessed them.
Because of the CRIMINAL actions of folks like this Lund Character, the entire financial system collapsed, Bail outs, bail in’s, insane interest rates and the whole host of ills we are living through emerged. So what happened to him? Let’s see…
Furtune Mag continues…. Lund’s penalty for his role: a mere $10,000. What’s more, the penalty won’t even be considered a fine. The SEC agreed to classify the payment officially as a “gift to the U.S. government,” not an actual punishment.
But the worst part is this: Lund won’t even pay the penalty. The agreement allows Fannie to make the payment for him, which it has agreed to do. And don’t forget: The government had to bail out Fannie and still controls it.
Wow. So, GM killed folks and got a slap on the wrist. This guy defrauded umpteen thousands of folks out of their homes, their “lives” and helped create the greatest meltdown in 75 years. He gets a 10K dollar slap on the wrist and they call it a “gift to the Government”. Oh, My. God.
Now back to Volkswagen. VW is one of, if not the biggest auto complex on earth. They employ over 600,000 people via engineering, design, plant maintenance, etc. They produce vehicles for the world. So what was so horrendous that they did, to bring an 18 BILLION dollar fine upon themselves? They fiddled with the software concerning emissions on their diesel engines. Basically it said the car was producing less “carbon” than it actually was. They didn’t kill anyone, they didn’t swindle hundreds of millions of dollars. Nope, they simply lied about their carbon amounts. For that…they’ll be darn near bankrupted.
See any problem with this? I do. Why are they pouncing on VW so hard? For two reasons actually, but they work perfectly in concert. First, the Elites have been pushing global warming on us for more than 15 years now. According to them ( and now the Pope) global warming is the single biggest threat of all time and they stand fully ready to regulate, tax, and make you conform to the carbon credit market. Or you’ll die.
If VW had merely killed innocent consumers by putting in faulty switches, they’d have been fine. No problem. Sorry, simple mistake. But play with the golden God of Carbon emissions? Now you have a problem. An 18 BILLION dollar, job killing, company crushing problem.
But it’s much deeper than that. As I said this is a double edged sword. Because the US expects all nations to do as we tell them without question, if you don’t toe the line, bad things happen to you. Ask Libya. Ask saddam. Ask Syria. Ask Russia.
Well the US has been having issues with certain aspects of Germany. Germany got hot under the collar about all the NSA spying. Then Germany had the audacity to ask for its gold to be sent back, an absolute crime of epic proportions. Then they got rather perturbed that because of US sanctions on Russia, German business was getting crushed and losing billions in trade. To top it off, members of Germany’s banking sector were opposed to the QE programs of Brussels. Germany was getting boisterous and that’s a no-no.
So, as usual the US had to show who’s boss. Because as George Bush declared, you’re either with us or against us. He wasn’t just talking about terrorism folks. It’s everything, business, trade deals, NATO expansion, poking Russia in the eye, fomenting Government overthrows, all of it.
But the final stake in VW’s heart was that they had plans to build a massive all-electric car in China. They had plans to spend 22 Billion Euro’s in China making 15 different models, some of which were cheaper than Tesla’s, went further, recharged in mere minutes and performed better. Do you think the US was going to miss the opportunity to shut down that little expansion of Chinese/German business?
So now you know why VW is getting absolutely shellacked over this. It certainly isn’t their cars, they make some of the most high MPG vehicles on earth. There have been NO complaints about too much smoke or dirt coming out of their tailpipes. This was a “hit” nothing less.
And the hit will come fast and furious. People will sue them for “loss of resale value” and the “over the top” greens will scream to the courts that VW is somehow killing Bambi. Now don’t get me wrong, VW did indeed “lie” and break the rules. No question about it. However, does the punishment really fit the crime?