Monday, March 24, 2014

Who's driving responsibility?

Even as auto manufacturers introduce more and more vehicles that secretly collect more data about us, we are discovering that when it comes to disclosing information about themselves it's a different story.
General Motors, for example, is just the latest manufacturer caught hiding information about a serious defect. In February the automaker issued a recall of 1.5 million vehicles to repair ignition defects linked to at least 12 deaths. GM knew about the defect for more than a decade. This from the recipient of a $49.5 billion too-big-to-fail government bailout.
GM faces an investigation from Congress, the Justice Department and, ah, the company itself.
Then there's Toyota that last week agreed to pay a $1.2 billion fine to avoid prosecution over safety problems linked to 37 deaths. Just as was the case with GM, Toyota executives knew for years about potential problems with floor mats and gas pedals. The company misled consumers and the National Highway and Traffic Safety Administration about the scope of the defects until regulators forced the information out. Some 9.4 million vehicles were eventually recalled.
The $1.2 billion fine was the largest penalty ever paid by an automaker, but it was a penance of the $13 billion fine Toyota could have faced had it not settled.
By its own admission, Toyota sought to protect its brand ahead of its customers' safety. By settling, the company protected not only its bottom line -- not to mention the just under $60 billion Toyota has on hand -- but its execs, not one of whom will face criminal sanctions.
That's the way it always works. Somewhere in the bowls of the corporation, faceless executives make decisions that harm others and when they're caught the company pays a fine -- often, though not in Toyota's case, without admitting any wrongdoing. The fine is a cost of doing business, a cost passed on to shareholders and customers. Meanwhile, the executives in charge are handed bonuses and country club memberships. No perp walk for them.
Probably that's OK in a country where the Supreme Court has decided companies are "people." By that skewered thinking, a corporation being fined is a "person" being fined.
All of this isn't over, of course. Toyota and GM face more investigations and the lawsuits are piling up. If those costs came directly out of the pockets of the executives responsible, the defects would have been caught and cured much, much earlier.

No comments:

Post a Comment