“Mr. President,

It is clear that Volkswagen has deliberately broken the law, and deliberately misled both regulators and customers.  It was wrong to do so.  It should rightly face appropriate and proportionate penalties.

But we must understand the regulatory environment in which this scandal has emerged.  The truth is that legislators were consumed by climate hysteria and carbon-phobia, and as a result we pushed car owners, and the auto industry, towards diesel, which was seen as a lower-emission fuel.

In fact its CO2 emissions are only marginally less than petrol, and in any case CO2 is not a pollutant.  It is a natural, non-toxic trace gas which is essential to life on Earth.  But as we are now realising, diesel’s other emissions – SOx and NOx and particulates — are highly toxic, and our dash for diesel has done more harm than good.

VW was trying to follow regulatory pressure by moving to diesel power, but found that it was unable at the same time to meet emissions targets, so it decided to cheat.  It was wrong to do so, but so were we, as legislators, wrong to impose conflicting and contradictory demands on the industry.

I see a parallel here, Mr. President, with our ill-judged rush to promote bio-fuels, before we understood the issues of energy inputs to agriculture, and the implications of Indirect Land Use Change.  By mandating 10% biofuels, and then later rowing back, we sent confused signals to industry and caused great damage to investors.

It is no part of my job to defend German industry.  But nor is this a time for schadenfreude.  I am concerned that the potential hit to Volkswagen could damage all of us – especially if, as many expect, other companies are drawn into the scandal.

With the prospect of multi-billion dollar fines in several countries, recall costs, class actions from owners and so on, it is not inconceivable that VW could fail.  That is an outcome we should seek to prevent.”


This article first appeared on Roger Helmer’s blog.

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