You don’t have to look far to see where this is going. On Tuesday President Trump met with leaders of the so-called Big Three to discuss the future of the American auto industry, and it appears the future doesn’t include the rights of the average American.
Sitting down with the CEOs of GM, Ford and Fiat Chrysler, Trump implored the nation’s largest auto manufacturers to start building plants in the U.S. He also urged them to hire American workers. In exchange, he promised to cut taxes and ease governmental and environmental regulations, which he believes are strangleholds to homegrown companies looking to invest domestically.
On its face, Trump’s logic is flawed. Manufacturing is significantly cheaper when outsourced to places like Mexico, and as Kristin Dziczek, director of the industry, labor and economics group at the Center for Automotive Research, described to the Washington Post: “the big automakers make investments knowing they will outlive any single president, regardless of what policies or regulations are put in place.”
The irony then of Trump’s plan is that it’s more likely to hurt average Americans than help them. The trick is to read between the lines. Easing regulations is likely code for eliminating accountability, thus giving big companies like Ford, GM and Fiat Chrysler nearly unmitigated protection in the event of a lawsuit.
I’m talking, of course, about liability, “the state of being responsible for something, especially by law”: the GM ignition switch crisis, for example, or the Takata airbag debacle. If you’re looking for blatant obfuscation, Volkswagen recently paid record fines for implementing a system that skewed the results of emissions tests. Our associate attorney, Brett Manchel, briefly touched on the definition of limited liability in a post about Uber’s new Terms of Service agreement. It’s worth reading to give you another perspective of what I’m talking about.
Like all companies subject to consumer protection laws, GM, Takata and Volkswagen have paid handsomely for defects that have either killed someone, or in Volkswagen’s case, killed the environment. It’s a pittance in comparison to lives lost and damage inflicted.
But money is money and no one likes to lose it. If Trump gets his way, we’re approaching a crucial juncture that has the potential to do real damage to consumer protection laws, giving corporations even more advantages than they already have.
Yesterday the New York Times wrote that representatives of the Big Three expressed optimism at the idea of a “a renaissance in American manufacturing,” now coming off a record sales year in 2016. That optimism is likely tempered by the fact that the White House sees big business as victims rather than perpetrators.
One of the nice things about living in a developed nation like the U.S. is that you shouldn’t have to worry about food being safe to eat, water being safe to drink, products safe to use. The reason for that is because regulations are frequently nothing more than safety rules. In case you haven’t already noticed, Trump the businessman doesn’t see it that way.
Jay Stefani is a partner at Levinson and Stefani. Follow him on Twitter.