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Disgraced Volkswagen raises the bar for corporate malfeasance

German automaker Volkswagen lied to customers and to government regulators from multiple nations. Now it must be held accountable. A recap for those who haven’t been following the story: The Environmental Protection Agency accused VW of setting certain diesel cars to cheat on emissions tests.

Company officials soon confessed. When a diesel car detected that an inspection was underway, it dialed back the engine so the exhaust would be clean. Then, when the owner was back on the road, it went back to normal, spewing up to 40 times more pollution than is legally allowed but also getting more miles per gallon and power. The company admitted it did this intentionally for years. Affected models include the Passatt, Jetta, Jetta SportWagen, Golf, Beetle and the Audi A3. There are about a half million of them in the United States and 11 million or more worldwide. This wasn’t an engineering mistake that slipped through.

It was a brazen violation of the law. The EPA is a common target for criticism, especially from conservatives, but give credit where it is due. This incident demonstrates precisely why America needs environmental regulators who demand strict adherence to standards. If the EPA had not acted on a tip from West Virginia University researchers that VW was lying, who would have? The agency even plans to beef up its testing regimen as it continues to investigate VW and other manufacturers. VW marketed these cars to consumers as the sportier option to hybrid vehicles. They were “clean diesel.” They were cars for people who wanted to do right by the environment but didn’t want to sacrifice performance. Drivers could have their torque and their high mpg too. Don’t cry for a company that brought this on itself, or for its fallen chief executive, Martin Winterkorn, who resigned on Wednesday. Save your sympathy for the victims, the people who bought those cars based on the belief that VW was telling the truth. A cynic might invoke that old idiom, “If it sounds too good to be true, it probably is.” But car buyers don’t have the wherewithal to conduct their own independent tests of emissions and mileage.

They must assume some honesty and oversight. They only got the latter, and too late for those who had bought a diesel VW. Now they need to be made whole. There are already class action lawsuits in the works, and a recall seems inevitable. For VW to put this sordid incident in its rear view mirror won’t be easy or cheap. People who bought these cars paid a premium. If a recall results in reduced performance and less fuel efficiency, buyers will deserve compensation for lost value and increased expenses. The best path forward might be for VW to buy back affected vehicles. If the company does right by consumers, it might just start to rebuild its reputation. In the meantime, the EPA and other federal and state regulators must make sure these cars don’t emit pollutants.

If VW goes the recall route, some owners might choose not to participate, choosing performance over clean emissions. Regulators and the company must have tools in place to detect those people the next time they go for an emissions test, at least in the states that have such requirements.