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Under Increased Scrutiny, Cracks Appear in Federal Auto Regulation

September 24, 2014

The last time this blog posted an article on the massive (20 million cars and counting) recall issued by GM earlier this year, it was to report that federal regulators were beginning to suspect a cover-up among executives at the automotive company. More troubling, from an oversight perspective, is a recent investigation conducted by the New York Times in which reporters claim that the National Highway Traffic Safety Administration has a terrible track record when it comes to responding to dangerous threats promptly.

The article’s introduction proposes that in several recent vehicle safety controversies, “including unintended acceleration in Toyotas, fires in Jeep fuel tanks and air bag ruptures in Hondas, as well as the GM ignition defect — the agency did not take a leading role until well after the problems had reached a crisis level when safety advocates had sounded alarms and motorists had been injured or died.”

After studying documents, interview transcripts, correspondence, and congressional testimony (to name but a few sources), the Times writers explain that the NHTSA spends just as much money rating new cars (a known marketing gimmick for automakers) “as it does investigating potentially deadly manufacturing defects.” Plus, suspiciously, the percentage of cars rated five-stars for safety has jumped from below 20 percent in 2011 to about 65% in 2015. What is worse is the revelation that the agency is “so deferential” to manufacturers that “it made a key question it poses about fatal accidents optional — a policy it is only now changing after inquiries from the Times.”

The NHTSA has been so meek in the face of these car companies that it has, in the past, lowered total numbers of Chryslers to be recalled from 2.7 million to 1.1 million, allowed Toyota to withhold accident information, and inexplicably ended investigations that led to continued fatalities (in the case of faulty air bags in Hondas). The Times exposé reveals that the agency’s full powers include forcibly issuing recalls (rather than requesting them) and issuing subpoenas. During the GM investigation before Congress, the acting head of the NHTSA, David Friedman, admitted that he did not even know his agency was capable of subpoenaing documents.

In an editorial that ran a few days after the investigative article, the Times board argues that the NHTSA seems “too willing to take the company’s [GM’s] word at face value” rather than scrutinizing safety records. The board is also quick to blame Congress, whose cuts have not allowed its budget to even adjust for inflation and whose number of employees has dropped by nearly 20 percent since 2001. Even more painfully, the House reports that the lead investigator in the GM ignition failure case had not been involved in formal training for “six to eight years.” More recently, it took a dedicated trial lawyer to uncover a hazardous defect in GM’s ignition switch that would have been hidden under the rug by GM and its perjuring engineering experts. Open access to the courts ensures public safety.

This blog has spent a lot of time criticizing the FDA for its failure to oversee the products under its jurisdiction, but apparently pharmaceuticals and medical devices are not the only dangers we face due to lax federal regulation. The Times editorial is right to call this state of affairs “unacceptable”–just as we cannot trust drug makers to report the dangers associated with their goods, we cannot trust automakers to admit that their cars are killing innocent people.

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