Posts Tagged ‘General Motors’

“GM will pay $900M to end US criminal probe over ignition-switch issues”

Details at ABA Journal. The settlement inevitably invites comparison with Toyota’s agreement to pay the federal government $1.2 billion to settle criminal charges over alleged coverup on the sudden acceleration issue. One difference that comes to mind is that GM’s use of a flimsy ignition switch was a genuine design flaw that appears to have contributed to numerous accidents and deaths, while the Toyota “flaw” was imaginary.

P.S. “Apparently, there is no Vice President In Charge Of Going To Jail at General Motors.” [Daniel Fisher]

December 10 roundup

  • “Judge dismisses ‘American Idol’ racial bias lawsuit” [Reuters]
  • “Don’t sue your art dealer, because you won’t win” [Shane Ferro, Business Insurance on fate of Ronald Perelman suit against Larry Gagosian]
  • Lawyer with big case pending before West Virginia high court bought plane from chief justice’s spouse [ABC, Charleston Daily Mail, WV Record]
  • Remembering Bruno Leoni, classical liberal known for theory of superiority of decisional law process over legislation [Cato panel this summer, Todd Zywicki/Liberty and Law]
  • “If I ever shoot your wedding, I’ll be sure to add a clause of ‘You cannot sue me for $300,000.'” [@GilPhotography on PetaPixel coverage]
  • “Court Unconvinced by Lawyer Dressed as Thomas Jefferson” [Lowering the Bar]
  • Arizona attorney general to GM: gimme $10K for every vehicle you’ve sold in my state [Bloomberg]

On GM, Toyota, politics, and the neglect of safety

I was a guest Tuesday on the Roger Hedgecock program at the San Diego Union-Tribune, discussing the way Washington, D.C. seems to have come down at least as hard on Toyota as on General Motors, maybe harder, even though the safety shortcomings falsely attributed to Toyota appear actually to be present in the GM case.

One striking feature of the GM story is the extent to which a culture of putting as little as possible on paper appears to have undermined GM’s capability to grasp the scope of the safety problem with the flimsy ignitions and their relationship to nonfunctional airbags. Bill Vlasic of the New York Times reports:

To the legal department at General Motors, secrecy ruled. Employees were discouraged from taking notes in meetings. Workers’ emails were examined once a year for sensitive information that might be used against the company. G.M. lawyers even kept their knowledge of fatal accidents related to a defective ignition switch from their own boss, the company’s general counsel, Michael P. Millikin.

As I’ve often noted, organizations gripped by fear of legal consequences or hostile oversight often develop a “put as little as possible on paper” mentality, even though such a mentality regularly proves counterproductive to the organization’s mission by fostering ignorance and lack of coordination and allowing bad practice to take root.

May 30 roundup

Welcome Wall Street Journal readers

Last week the Department of Justice announced a deal with Toyota in which the Japanese automaker would fork over $1.2 billion and place itself under supervision for allegedly not being forthcoming enough with information at the height of the 2009-2010 panic over claims of unintended acceleration in its cars. The acceleration claims themselves had turned out to be almost entirely bogus, and were refuted in a report from the federal government’s own expert agency, NHTSA. Instead, the prosecution relied on a single count of wire fraud: Toyota had supposedly given regulators, Congress and the public an erroneously positive view of its safety efforts. It should therefore have to “forfeit” a huge sum supposedly related to the volume of business it did over a relevant period.

I’ve got an opinion piece in Monday’s Wall Street Journal (unpaywalled Cato version here, related Cato post here) about this whole appalling affair, which should frighten other businesses that might face draconian charges in future not just for compliance infractions, but more broadly for defending their products in the court of public opinion. Meanwhile, the Justice Department’s grandstanding and demagogic press release goes to some lengths to leave the impression “that unintended acceleration is some mysterious phenomenon of auto design unrelated to flooring the accelerator.” Someone here is irresponsibly misleading the motoring public and withholding vital safety information, but it’s not Toyota.

A few related links: NHTSA unintended acceleration report, Car & Driver’s coverage, and my 2010 opinion piece. And Holman Jenkins at the WSJ (paywalled) compares the still-unfolding story of ignition problems at GM, also discussed by Paul Barrett at Business Week.

Environment roundup

  • Behind a YouTube anti-fracking video labeled “Hydraulic Fracturing turns gardenhose to flamethrower,” there’s quite a story [Star-Telegram]
  • BPA-endocrine alarms: “Why Nick Kristof’s Scientific Illiteracy Threatens Us All” [Trevor Butterworth, Forbes]
  • Incy wincy spider shuts down $15 million construction project [Fox]
  • Regulatory Balkanization of gasoline market worsens price volatility [Morriss/Boudreaux via David Henderson; more, WSJ] Will CAFE sink GM? [Holman Jenkins via same]
  • “After a fire at a massive oil plant in California, residents want compensation. But it’s not that easy” [Above the Law]
  • “Dispatches from the Duke Conference on ‘Conservative Visions of Our Environmental Future'” [Jonathan Adler]
  • Broadway, dark? “The high cost of closing Indian Point” [Lesser & Bryce, NYP]

Labor and employment roundup

  • Failure to accommodate employee’s religious belief forbidding hair-cutting results in $27K payout by Taco Bell operator [EEOC, North Carolina]
  • There’s a reason they call it Government Motors: nonunion GM assembly workers get shaft [Fountain]
  • Mayor Bloomberg refreshingly sane on “living wage,” though not alas rent control [Heather Mac Donald, Secular Right]
  • “The cost of labor isn’t the main problem, it’s the rigidities,” says French CEO [Bloomberg]
  • Maryland governor signs bill softening “workplace fraud” law that bedevils firms that use independent contractors [H.B. 1364, earlier]
  • Watch out for ghastly, mislabeled “Paycheck Fairness Act,” they’re trying to bring it back [Diana Furchtgott-Roth, Examiner, earlier]
  • “The most infuriating part of this is that it takes five years of litigation to fire a badly behaved police officer” [Josh Barro, Masnick/TechDirt, on cop’s harassment of skateboarder; Baltimore Sun (police union calls officer’s firing “outrageous.”)]