If VW were a pupil in the European Boarding School… whom would we blame, VW or the headmaster of that school?

Sir, Richard Milne at the end of his report of Volkswagen’s woes writes: VW makes about the same number of cars as Toyota – but has almost double the number of workers – 593.000 to 344.000”, I guess then that 249.000 workers would not be in total agreement with the titling of the report: “System failure” November 5. You just cannot have the cake and eat it too.

It must be quite clear that to overcome such a competitive disadvantage, VW had to resort to other means… in this case clearly not so elegant or legal means. Do I condone it? Of course not, but let's keep the debate real. The trade off between carbon emissions and jobs is very much out there in the real world.

But let us now also suppose VW was a pupil in the European Boarding School. If it had acted this way, blatantly infringing regulations during years… whom would we blame, VW or the headmaster of that school?

Or should 249.000 potential Toyota workers want Toyota bosses to cheat on the headmaster too?

@PerKurowski ©

Is it not dumb to kill the goose that lays the golden eggs just because it laid a bad one?

Sir, John Kay asks correctly: What purpose is achieved when taxpayers, by fining state-funded hospitals, in effect fine themselves? “It is natural but wrong to blame executives” October 21.

I would go further still by asking: What is the reason to fine corporation that generate jobs in such a way that it weakens them? Instead of in cash, is it not better to have those fines paid in shares… the current shareholders may not like to get diluted, but it is always better to dilute the wealth of the owner of the goose that lays golden eggs than the goose itself.

And of course, if you need clarification, the goose here stands for banks and for Volkswagen.

@PerKurowski ©

Berlin, are there no more urgent sustainability needs to serve in Europe than having Volkswagen recall 8.5m diesel cars?

Sir, Jeevan Vasagar and Chris Bryant report “Berlin forces VW into mandatory recall of up to 8.5m diesel cars across Europe” October 16. Why on earth would Berlin do a dumb thing like that?

What will that cost? Are there no more urgent needs to serve in Europe than recalling diesel cars?

Is it because the hurt inept emissions controllers who were cheated now want revenge? A lover’s spat?

How does the world benefit from forcing VW into mandatory recall of up to 8.5m diesel cars across Europe?

What will that cost? Is Europe really so buoyant that it can pay for an 8.5m diesel cars recall across Europe?

Is recalling these cars the most effective way to cut emissions that pollute, and to help the earth’s sustainability?

How much useful research could not be funded with what is to be wasted on the recall of 8.5m diesel cars?

Frankly if you want to punish Volkswagen without punishing other don’t recall cars give the diesel car owners, or other, some Volkswagen shares instead.

Sir, as a reminder, here is a previous letter on that.

@PerKurowski ©

To avoid collateral damages, the fines of those who create and finance jobs should be paid in new shares and not in cash.

Sir, I refer to Henry Foy’s and James Politi’s “Volkswagen scandal fuels fears for jobs across Europe” October 13.

Again it points to reasons why the world should not impose fines payable in cash on those who misbehave and deserve punishment, but who generate jobs, or credit. That would only weaken them and thereby cause many casualties among the civilians who are not responsible.

Have them instead to pay all fines by issuing new shares to be delivered to whomever a judge feels should get these.

The dilution of existent shareholders is more than enough punishment to guarantee that management will be more careful.

And this is especially valid when regulators, by their incompetence or any other reasons, have helped to induce the misbehavior. 

http://teawithft.blogspot.com/2015/10/vw-emissions-controls-fines-for.html

http://teawithft.blogspot.com/2015/10/bank-fines-should-be-paid-with-bank.html

@PerKurowski © J

VW & emissions & controls: Fines for allowing itself to be tricked, should not become a revenue source for governments

The more I read about the Volkswagen affair the more convinced I become of that, what really does not bring anything to the table in terms of justice, economic efficiency or even sustainability, is having VW to pay huge fines to a government that hosted such inefficient emission controllers who allowed themselves to be tricked by clearly immoral but also quite ingenious engineering tricks.

On reading Richard Milne’s “Wolfsburg fears fallout from VW scandal” October 12 this is what I would suggest:

Decide on a substantial amount to fine Volkswagen for their misbehavior, but make it pay all that fine by issuing (green) shares in Volkswagen, to all who bought its diesel cars and to all of its employees. That way you do not weaken a company, or a city, while at the same time, presumably, you introduce among VW’s shareholders a wish for a better corporate behavior, so as not having their shareholder participation further diluted.

And then, just how you use hackers to assist you in building safety features for increased cyber-security condemn, all the Volkswagen engineers responsible for the misdeeds, to social work, by developing emission controls that work.

PS. This is somewhat similar to the fines on banks, which directly hurts their lending capacity, precisely when we need it the most.

@PerKurowski ©  J

World/Germany: Don’t fine Volkswagen for the benefit of those who should have controlled emissions better. Be smarter.

Sir, I refer to Chris Bryant’s “New VW chief signals cost cuts to pay for emissions bill” October 7.

If I were Volkswagen’s new chief executive, I would not accept, laying down, to “slash costs to help to foot the bill for the diesel emission scandal” No way! I would strengthen Volkswagen by making a counteroffer the world could not resists… because of its implications.

I would offer the authorities, in lieu of any fines related to The Scandal, to give to each of VW’s 600.000 employees, and to each of 11.000.000 of VW’s diesel car buyers, for example €1.000 in Volkswagen preferred "green" shares, convertible into ordinary VW shares.

And, if the offer was accepted, I would not waste one € correcting wrongdoings on the past, but instead duplicate the € 11,5bn research budget of last year.  But, that’s just me.

I dare you to find one environmentally concerned, who is not a statist, who would not agree with me.

PS. Volkswagen, don't delay your answer... the faster the better.

@PerKurowski ©  J

When Volkswagen is fined, as it should be, let all its diesel car buyers get some VW shares, instead of cash.

Sir, Wolfgang Münchau writes about “Volkswagen’s threat to the German model” October 5. Of course, that would be the case, if Volkswagen is forced to “a fire sale of assets in order to pay damages and fines [that] could easily add up to more than €100bn.”

But that would just be a typical stupidity of our days, like when our banks are fined, and then we find their lending capacity utterly diminished.

I am not a German, but if I were, I would urge the government to see that each Euro Volkswagen had to pay in fines because of its truly shameful “manipulation of emission tests”, was to be paid in shares issued at current market prices to the owners of diesel cars... those concerned about pollution. 

That would not weaken Volkswagen, much the contrary it could strengthen it. If our successful companies do wrong, there’s nothing in it for us to be vengeful, on the contrary there is a great opportunity to be constructive. Never weaken the strong to make them work better… strengthen them… but, then again, that’s just little me thinking.

@PerKurowski ©

When paid by Volkswagen, the fines should go to patent free research of better diesel engines… and emission controls

Sir, Brooke Masters write “Drivers who bought VW’s “clean diesel” engines are now faced with technical fixes that could well reduce both fuel efficiency and power. Their communities have much dirtier than anticipated air” “Lawsuit on behalf of 1m $1 investors is something to fear. Somebody ought to sue” October 3.

Indeed but when suing make sure that if you win it can make a difference, not just make up for something secondary.

Many Volkswagen’s diesel engine buyers, who said they bought it out of environmental concern, many of them just green show-offs, now have a legitimate grievance being left out hanging like fools. But, if they are going to sue, they should at least request that, if successful, all fines paid by VW should go to finance the development of patent free better diesel motors.

Brooke Master’s also writes: “There are many frivolous [and not non frivolous] law suites were the attorneys on both sides walked away with millions of dollars in fees”. And with that she reminds me of that, at least in the case of banks being sued, all lawyers should be paid their fees in bank shares… I mean so that we do not hurt the lending capacity of banks and with that of ten thousands of innocent bystanders borrowers… the sort of civilian casualties.

Perhaps if we start looking into the issue of where compensation payments and fees go to, and how it is paid, then perhaps we will start looking at tort reform from a much more productive angle.

@PerKurowski

Those creating regulations that can be cheated provide the cheaters competitive advantages.

Sir, Michael Skapinker writes: “Devising a system to detect when a car is being tested surely required planning, expertise and a specific decision. It must have required forethought. It is not something you can drift into through incrementally deteriorating behavior”, “Volkswagen, its software and the psychology of cheating” October 1.

Indeed and we must blast Volkswagen for doing that. But, is it not also the responsibility of regulators to make absolutely certain that cheating cannot happen? Otherwise they will be providing the cheaters with a competitive advantage to win over those who do not cheat. At the end of the day, though Volkswagen needs to be punished, severely, let us not forget that it all happened thanks to lazy regulators who thought it was enough to regulate and no would cheat or game it.

Exactly the same happened when bank regulators allowed banks to hold very little capital against what was perceived as absolutely safe, and the securities backed with lousy mortgages to the subprime sector were dressed to the nines, wearing false AAA ratings.

@PerKurowski

Perhaps Paris should have a little tête-à-tête with Volkswagen about what to do about embarrassing pollution ratings.

Sir, Adam Thomson discusses the embarrassment to Paris its lousy environmental readings could cause when, for a UN conference in November, “some 40,000 politicians, delegates, scientists and environment experts will descend on Paris to discuss what is billed by many as humanity’s last hope of saving the planet from irreversible climate change”. “Dark and dirty days in the city of light” September 23.

Perhaps Paris should have a little tête-à-tête with Volkswagen to see if it has any ideas about what could be done.

Or, in these days when Volkswagen has so utterly destroyed the credibility of emission controllers, Paris could perhaps just discreetly let out something like: “Our emission readings are sincere”

Oops… should those who have responsibility for supporting tourism in big cities also need to have tête-à-têtes with App developers like Plume?

http://ourpiedaterre.blogspot.com/2015/09/the-vw-volkswagen-emission-control.html

@PerKurowski