The Volkswagen scandal reveals the corruption of the Left's regulation dreamworld

Liberal, competitive capitalism is the opposite of the law of the jungle because it depends on rules. Those who transgress must be swiftly punished.


Allister Heath in The Telegraph


If I were Jeremy Corbyn, I would be thanking my lucky stars for the scandal that threatens to engulf parts of the car industry. Nothing is more guaranteed to galvanise the Left-wing cause than a corporate conspiracy – and the VW diesel affair, which reads like the script of a Hollywood movie, ticks all of the boxes. Lies, secret computer technology programmed to fool the authorities, a deliberate breach of environmental regulations by a rapacious corporation: it’s all there, and crying out for the full George Clooney treatment.

Fortunately, this latest blow to the reputation of big business won’t be enough to rescue the doomed Labour leader. But those of us who support capitalism must lead condemnations of VW’s egregious behaviour, and explain clearly that a functioning free market implies a scrupulous adherence to the rule of law.

What is most damning about this scandal is that an almost identical deception had already been uncovered. In October 1998 the US Department of Justice and Environmental Protection Agency fined seven heavy-duty diesel engine makers for equipping their engines with an older version of “defeat devices” – just like in the VW scandal, software designed to detect and trick the official tests. The automotive industry must be forced to change its ways. It must become truly transparent, and there needs to be a crackdown on abuse.

It is vital that free-marketers explain again and again that proper liberal, competitive capitalism is the exact opposite of the law of the jungle or of a Hobbesian free for all: it is a remarkably disciplined system. Individuals are encouraged to pursue their self-interest; but unlike in a kleptocracy, they can’t force anybody to trade with them and must respect the sanctity of private property rights, contracts and the legal system.

It doesn’t matter how big your company is or how rich you are: a pledge must be met; a product must deliver what it says on the tin; lies are never acceptable. Breaking the law must lead to pitiless prosecution; and selling customers a pup must result in litigation and thorough compensation.

Free markets are at once realistic about human nature – unlike naive Leftyism, they don’t assume that people are altruistic or self-policing – and civilising, in that they force people to adhere to strict norms of behaviour. As Milton Friedman put it in his famous libertarian theory of business ethics: “There is one and only one social responsibility of business ... to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud.”

There will always be dishonesty, in all walks of life, in every industry and profession, in the public and private sector and in all economic and social systems. Yet humanity’s inherent fallibility, and the need for eternal vigilance, doesn’t invalidate the fact that free markets are the best possible system to create wealth and prosperity for all.

But while corporate scandals always force the political right onto the defensive, this particular story is just as bad, if not worse, for the Left-wing world-view. It shreds many of its favourite assumptions, highlights endless government and political failures and mercilessly exposes the flaws at the heart of the ridiculous virtue-signalling that has passed for environmental policy in recent years.

Take the nonsensical claim that the City of London is a cesspool of iniquity, home to a uniquely amoral tribe of adrenalin-junkies willing to lie and cheat whenever bending the rules is deemed to be a gamble worth taking. The truth is that no industry can claim moral superiority, and all are blighted by a tiny minority of rogues: even old-fashioned manufacturers in the supposedly gentler, law abiding industrial capitals of Old Europe can and do commit fraud, taking insane risks to pull the wool over regulators’ eyes. The anti-London euro-enthusiasts were wrong, once again.

Or consider another Left-wing shibboleth: the idea that Wall Street’s lobbying and influence means that it effectively controls the US political system. Yet the VW scandal reminds us that heavily unionised car manufacturers have traditionally been far better at getting their way, collecting handouts and bailouts and directing legislation. They have convinced politicians, especially in Germany, France and Brussels, to turn a blind eye to indefensible testing practices that would never be tolerated in any other industry.

What must be most galling to the Left is that VW is structured exactly in the way they would love every company to be. It is partly owned by a German state; the remainder of its ownership structure means that it is protected from a hostile takeover; and it has the sort of two-tier board structure beloved of the dafter corporate governance activists, complete with plenty of trade union representation. Yet it didn’t make a blind bit of difference. In the fraud stakes, the Anglo-American model of financial capitalism and the Germanic and Japanese models are one and the same. Once again, the euro-enthusiast belief that everything is always better in Europe has been spectacularly refuted.

Last but not least, the scandal has highlighted the gross hypocrisy of politically correct companies, as well as how the environmental agenda can backfire spectacularly. Industrial firms should be honest: if they don’t like green rules, or believe that meeting them would impose price hikes on their customers, they should say so, not loudly sign up and bask in the moral high ground while surreptitiously ignoring the rules.

As to the embrace of diesel as a supposedly cleaner alternative to petrol, it has been a disaster caused entirely by official error. Desperate to meet Kyoto Treaty carbon dioxide targets, the European Union decided in the late 1990s to bet the bank on diesel. This reduced CO2 but increased emissions of nitrogen dioxide and particulates, an own goal if ever there were one.

The idiocy of the policy, backed by German carmakers, but for which the Eurocrats must bear responsibility, is only now becoming apparent. Nobody emerges from this sorry saga with any credit.

Nothing wrong in killing; you just shouldn't urinate on the corpses.

Robert Fisk: This is not about 'bad apples'. This is the horror of war

How many other abuses took place off camera? How many Hadithas? How many My Lais?

Robert Fisk

Friday, 13 January 2012

So now it's snapshots of US Marines pissing on the Afghan dead. Better, I suppose, than the US soldiers pictured beside the innocent Afghan teenager they fragged back in March of last year. Or the female guard posing with the dead Iraqi prisoner at Abu Ghraib. Not to mention Haditha or the murder videos taken by US troops in the field – the grenading of an old shepherd by an Iraqi highway comes to mind – or My Lai or the massacre of refugees by US forces in Korea or the murder of Malayan villagers by British troops. Or the Bloody Sunday massacre of 14 Catholics by British troops in Derry in 1972. And please note, I have not even mentioned the name of Baha Mousa.

The US Marines' response to the pissing pictures was oh so typical. These men were not abiding by the "core values" of the Marines, we were informed. Same old story. A "rogue" unit, a few "bad apples", rotten eggs. Maybe.

But if there is one game of pissing on the dead, how many others happened without pictures? How many other shepherds got fragged in Iraq? How many other Hadithas have there been? There were plenty of other My Lais.

As laptop filmography gets better, so it all comes slopping out, the rapes and slaughter – and yes, by the Taliban the stoning of young women for supposed sexual misconduct in Afghanistan; by al-Qa'ida, executions and throat-cuttings in Iraq.

And no – the Americans are not the Nazis, the Brits are not the French Paras of 1960 Algeria (but surely we're not comparing the French paras to the Nazis). The Canadians handed prisoners over to Afghan thugs for brutal questioning but the Canadians are not like Saddam's secret police – and, I suppose, the Taliban are not Stalin's NKVD or Putin's KGB (before he became a statesman). And you can't compare – surely – the Soviet invaders of Afghanistan in 1979 with Genghis Khan.

So let's take a little guessing game. A British Sunday paper reveals shocking revelations of torture and cigarette burning, of physical brutality where prisoners must be hospitalised for a week, of possible electric torture. The French in Algeria? Saddam's mukhabarat? Nope. It's The Sunday Times Insight Team's report of 7 May 1972; the victims, of course, IRA suspects in Belfast. A "rogue" unit? A "few bad apples"? I doubt it.

When the Gloucestershire Regiment went on a rampage near Divis flats, smashing every window in the street the day before they were due to leave Belfast, the line was changed. They had been under "enormous strain" – but weren't these the "Glorious Gloucesters" of Imjin River fame? And the killer Paras of Derry – weren't these the same Paras of Arnhem Bridge?

And so we go on. Yes, British troops murdered SS prisoners after Normandy – just as the Red Army did in the Second World War and the Americans. And all this gets a bit dull, doesn't it?

Dresden was worse than the Blitz – but who started it? Hiroshima was worse than Pearl Harbour (ditto). The Canadians bayoneted German prisoners in the First World War – but the Germans really did committed atrocities in Belgium in 1914. And what about Waterloo? What did we do with the heaps of French dead? Why, we honoured them by shipping their corpses off to Lincolnshire and using them as manure on the fields of East Anglia.

If war were not about the total failure of the human spirit, there would be something grotesquely funny about the American reaction to the pissing pictures.

For note, it was not the killing of these men that worried the Marine Corps in the US – it was the pissing. Nothing wrong in killing amid the "core values" of the Marine Corps; you just shouldn't urinate on the corpses. And even more to the point: YOU MUSTN'T DO IT ON CAMERA! Too late. It comes to this. Armies are horrible creatures and soldiers do wicked things but when we accept all these lies about "bad apples" and the exceptionalism of crime in war – "there may have been some excesses" is the usual dictator-speak – we are accepting war and going along with the dishonesty of it and we are making it more possible and easier and the killings and rapes more excusable and more frequent.
And how should armies react? With one word: guilty.