>> booktv wants to know what you're reading. send us your summer reading list via twitter @booktv or instagram at book underscore booktv or for our facebook page facebook.com/booktv. >> booktv on c-span2, television for serious readers. >> jack unit has been as a journalist in germany since 1994 including more than a decade as a correspondent at business week magazine here he joined "new york times" county joined a times in january 2010 a as a business and economics writer based in frankfort. during his rookie year at his new job, he won in your times publisher award in 2011 for coverage of the european debt crisis. keeping state in his pursuit of having and a lustrous international career as a journalist, jack continue to write about business, banking,

economics and monetary policy. another part of his coverage including the european car industry which gave motivated to write his new book, "faster, higher, and farther: the volkswagen scandal." "faster, higher, and farther" has found an appreciative audience with readers and critics alike and praise of his research and narrative style publisher weekly rights his compelling prose makes the book reads like entertainment more than education and the story of volkswagens fall have the company cheated emission testing devices was exposed by west virginia university researchers and finally with public excited by the epa, is a study and corporate hubris. interest in this now faded scandal may be confined to a niche audience but readers to pick up the book will be glad

they did. please join me in welcoming jack ewing. [applause] >> thank you very much, marc and it's great to be at the politics and prose which i understand is quite an institution in the washington area. the way that this book got started was that the editor and chief of norton sent me an e-mail and asking if i ever thought of writing a book about the volkswagen scandal to let them know and i let them know about five minutes later that it would be interested. one of the first things we were taught but have the book should be written, one of the first things that he said to me was jack, i don't care about cars. i'm not a car person. you have to write a book that is to want to read. iced sort of quarrel with what publishers weekly said about this being for a niche audience because i try to make it a deal that's really about ambition,

abuse of power. it's a book about how a toxic organizational culture can push ordinary basically decent people to commit crimes. and it's also a tragedy because the whole scandal threatens the jobs of hundreds of thousands come literally hundreds of thousands of volkswagen workers what nothing to do with the wrongdoing. let me talk very briefly about the history of volkswagen because that has an effect on what happens later. volkswagen started was actually basically a propaganda project by the nazis. they wanted come hitler was upset that americans, middle-class americans were driving around in model tease and germany had nothing equivalent, that anybody could afford. they came up with the idea of the people's car, the volkswagen and he hired a guy named porsche

to design and that's what they became the beetle. this is in the late 30s but actually they never managed to build that many cars before the war got started, and the factory were shifted to military production. after the war it could well happen that volkswagen never existed because the fact was bombed out. as assistant never actually produced that many cars, and what saved the company was actually a british major who was part of the occupation force and he noticed the beetle standing around in the rubble and a british on at the time needed transportation and they had a a bunch of workers who need something to do. so this major got them producing the car again. that was really the beginning of volkswagen as a company.

as you know it was the car, the beetle was a huge hit in the postwar market. it was simple and cheap and just what people needed at that time. ed was also very popular in the united states. in fact, by the late 60s volkswagen was the leading import brand in the united states. this was before toyota, nissan was big as they are today. but when the beetle inevitably started to become obsolete, volkswagen had a lot of trouble replacing it. and by the early 1990s the company was in pretty serious trouble. there was talk of michael baker. they have built more cars than they could sell and they were in serious trouble. this is where the porsche family comes back into the store remember porsche designed the first beetle in the early 1990s, his grandson whose name was -- became the chief executive. he had come up to the ranks at

audi. he was in many ways even more of an automotive genius and his grandfather, and he succeeded in turning volkswagen rent. he improved the quality and the static of the cars. sales recovered, profits recovered but he also had a dark side. he was dictatorial. he was known come he had no compunction about firing people that didn't meet his standards and he was known as many anecdotes about him calling engineers into the room and saying, this is what i want you to do. you had this much time, and if you fail you will be fired. so it was a very difficult corporate culture. another big achievement was in the realm of diesel. volkswagen is one of the first

companies that figured out how to sort of civilized diesel for passenger cars. diesels were known for being smelly and smoky and noisy, and volkswagen figured out how to combine engine computers and fuel injection to make diesels much quieter and cleaner than they had been. and just to tell a little about his character, he was an automotive genius on one side, while he was at a volkswagen the were a number of scandals. there was a corporate espionage scandal. volkswagen was accused of stealing secrets from general motors. there was a scandal with head of personnel was found to offensive line prostitutes who labor leaders to keep them happy. and he himself with some who just didn't live by the same rules as most of the rest of us.

just give you a little little anecdote out of his life, yet it will push started having an affair with his cousins wife. had two children with her and at the same time to children with another woman. and this is out of 12 children total during his lifetime. and he wrote about all this in his autobiography. it's not something he was ashamed of. if anything, he was proud of it. so after the scandals, there was never really any reform. at a healthy company was something like this happens you should reform the compliance. you should look at your code of conduct. you should think about ways that you can fit this kind of thinking happening in the future. and that didn't happen at volkswagen. so around the mid to thousands

-- 2000s, there's one thing that he never managed to do during his tenure and that was to recapture volkswagens glory in the united states. and that bothered him around the mid-2000s, volkswagen decided it wanted to become the largest car company in the world. they couldn't do that without also being a force in the united states. and by then actually volkswagen had become religious and niche brand they were selling about as many cars as subaru and that long since been overshadowed by toyota et cetera looking for a way, some kind of unique selling point that would help get back the market share in the united states. and they hit on diesel. diesel had been very successful in europe. by then it accounte account forf all new cars were diesels. the biggest fans of diesel is fuel economy. that was a big selling point in europe where fuel is very expensive. so they thought let's try that

in the united states, and we will sell diesel as an environmentally friendly technology and try to go people who might otherwise buy a toyota previous. and he decided to develop a brand-new diesel engine to do this. but, of course, the problem was that they found out that they couldn't make the diesel engine clean enough for u.s. emission standards. europe has a reputation for being more environmentally friendly and strict than the united states, but actually the united states have stricter limits on nitrogen oxides which are the most harmful component of diesel exhaust. and around 2006 the engineers realized they couldn't meet these u.s. standards, and probably the smart thing to do

would have been to delay the project, look at other technologies, spend some more money, figure out a way to make it cleaner. but that's not what happened. in late 2006 a group of engineers and managers got together at the research and development center at volkswagen, and information technology guy had prepared a powerpoint presentation. i'm convinced everything evil that happens at a corporation anywhere starts with a powerpoint, and the powerpoint showed how you could, the computer in the age in which sits under the hood could recognize the cycle the regulars use when you're testing cars emissions. they put the car on rollers in a garage and mystic instruments at the tailpipe and they run a simulated driving cycle, that is

supposed to simulate hills and city and highway and so on. but the cycle itself is predictable. it's public knowledge what that cycle is and so it volkswagen did is programmed the computer to recognize when that curve was, when the car was being driven according to that cycle and then to crank up the pollution controls so that the car would look clean. if they had the pollution controls all the time the car couldn't take it. some of the components could fail but it would deliver clean tailpipe emissions, some of the time. it's worth noting that there was a serious debate among those present about whether this is really a good thing to do. there were people that were against it who felt bad about it, but at the end of this meeting which lasted less than one hour, they decided to go ahead.

the last words of the senior person there as he left the room was come don't get caught. >> i think another thing that's worth noting about this particular, this behavior, was that if you look at the banking scandals, people were motivated by money, by greed. they wanted to get bigger bonuses, stock options, whatever that wasn't a factor here. the people who did this were really just trying to hang onto their jobs. none of them got promoted or any more money. it was just about keeping your job. i think that says a lot about volkswagen culture and the culture of fear that existed there. i think the other important thing is that it really would've cost volkswagen made a couple hundred dollars more per car to make it clean. and also as the years went on

there were many times when changes in models, changes in the design of the cars when they could have upgraded the emission system to make it compliant, but every time they came to one of these decision points when they could have made the cars clean, they didn't. once they got started cheating, it was a habit that was hard to break. and this went on until early 2014. i just want to back up a little. the regulators never tested cars on the road. it was always in the crotch and that's what enabled, that's what made it possible for volkswagen to cheat. but in the mid-'90s there was a guy at the epa who started working on portable emissions

technology, something to put in a vehicle and driver measure the emissions as they were underway. i do want embarrassing babies in the room right now. that is leo. raise your hand, leo. [applause] leo was a guy who started experimenting with this and developed company owns some of the patterns on the technology that allows, makes it possible to measure emissions. [inaudible] [laughing] >> makes it possible to measure emissions under way and that was really a very crucial in whole chain of events that led to volkswagen being exposed. so many years later, 2013, there was a nonprofit group called the international council on clean transportation. and they wanted to see what kind of technology that german carmakers were using in the united states with their diesels

that because of the time there was a debate in europe about making the standards stricter and the carmakers over in europe or say no, we can't do it, it's impossible. and this nonprofit said wait a minute, they're doing in the united states and their say they can't do it in your. what's going on? so they awarded a $70,000 grant to a group at west virginia university which has a center that is well known for his expertise in emissions testing. and they tested to volkswagens, and agenda predicted out on the west coast. mostly just a bunch of graduate students. several of them from india. and they quickly noticed there was a big difference between what the cars, the emissions they produce when it out on the highway and what they produced in the lab with the students had first tested the cars in the diet to get a baseline and then

they took it out on the road with his portable technology which leo has invented, and then and commercialized. and saw that there was something wrong. they didn't accept that point exactly what was wrong, just that something was fishy and they published a study about that in early 2014. nobody much noticed, but outside the industry, outside actually this very kind of subculture of people who follow emissions, but among those who notice was the california air resources board which is the regulator that enforces the clean air laws in california. and they were concerned enough that they put together what they call a compliance project. they use their clout as a regulars to assemble a small fleet of volkswagens and then

did intensive testing. and it volkswagen had been smarter they would have at that moment can fast and said, you know, mea culpa, we did something bad, we are really sorry. he will fix it. but the stuff the way the people at volkswagen kicked. instead they mounted a cover-up which lasted, walid of blasting a good year and a half. they fed the regulators misleading information, false information. there was this dialogue between the california regulars and volkswagen, long discussions about what was causing this problem and volkswagen kept telling them it was some technical issue. they would get it under control. they did a recall to update the software. that didn't fix the problem but is basically just a smokescreen delaying the day of reckoning. and finally you have to give

carb some credit. they really stuck with it, kept pushing and eventually in september 2015 volkswagen ran out of excuses. one of their engineers went up to one of the top people at card at a conference and said, it's a defeat device. in other words, has with this type of software is called, it's designed to defeat the emissions. and the regulators were extremely angry, to put it mildly, because they felt they had been jerked around for your and a half and that made the whole thing much more expensive for volkswagen because they had squandered any goodwill they might've had with the regulators. i think if they had fessed up right begin it might have been, cost and and the hundreds of millions or maybe a few billion at the most people end up costing them 22 billion in the united states, so far.

and there are still a lot of outstanding cases in europe. so where do we stand now? there's been, the settlements that a mention, six executives have been indicted. one of them is in jail. i guy named oliver schmidt was one of the point people with the regulators. he made the mistake of visiting the united states for the christmas holidays and was arrested at the airport. the other people that have been indicted are in germany which does not extradite its own citizens. and the investigations are continuing. one thing i'm often asked about is how high up did it go? i'm not sure we fully know the answer to that yet, but we do know, i just wrote about this for the "new york times" a couple weeks ago, that back in 2007 there was extensive

discussion at the level just below management board with people exchanging e-mails and powerpoint presentations where they went into some detail about how this illegal software would work. volkswagen says that knowledge never made it to the next level at the management board. we will see what happens. but in any case, your not later it's still a big issue for volkswagen. it would be easy to say that the volkswagen, this is something exception of bauxite because it does have a unique history. but i think that actually it's something that could happen at any large corporation. i don't think it's at all unusual because in the corporate world for managers to set a very ambitious goals and to make it clear that the penalty for failure is to get fired.

and i think, recent example is the wells fargo, the california bank which had very similar type of thing involving consumer fraud. and i think the lesson from a business point is there's nothing inherently wrong with setting ambitious goals for people, but it has to be very clear what the boundaries are, how far you're supposed to go to meet these goals. at what point do you say i can't do this ethically or legally and we have to come up with a different plan? that's what was missing at volkswagen. the engineers who did this obviously felt this was expected of them by management and also that they had come those who had concerns, who worried about whether that was the right thing to do, they had no place to turn. they had nobody they could turn to to express their feelings without destroying their own

careers. i think the other thing is it's crucial, if companies of values, and volkswagen had a coat of compliance. what really matters is the signal set a coming down from the top. if you have, you are had a person was found to have been supplying prostitutes and labor leaders and nobody really seems all that upset about it, a few people take the fall and then business goes on as usual. i think that sends a much more powerful signal to the people below management that any code of conduct or anything written on paper. just looking to the future, i think volkswagen will survive this scandal. it's a very powerful company. they have a lot of cash. i don't think there's any issue of them going bankrupt, but it

has hurt their market share in europe. diesel which is a big part of their business model is dropping. the popularity of diesel in europe is dropping very quickly. that's a problem. and perhaps not surprising, and i think the biggest problem for volkswagen is that this is really a moment of transition in the auto industry. silicon valley companies are getting interest in the auto industry yet tesla building electric cars. you have google working on self driving cars, apple is set to be working on things. uber and these coming up a lot more money than the carmakers because they are worth so much on the stock market. so the car market, the carmakers have to be adjusting to this, and volkswagen has to do that with a lot less money than it would've had before. they would certainly rather be spending at 22 billion on research and development than on

fines and legal settlements. >> i mentioned at the beginning the tragedy, editing that's really true. in many ways volkswagen was incredible success story, when you look at how it rose from the ashes of world war ii and became the biggest car company in the world. one of the ironies of the holster was that a couple of months before the scandal broke, volkswagen actually surpassed toyota as a largest car company in the world. i think that surprises americans because we think of volkswagen is being kind of a niche brand, but in the rest of the work it is huge. huge in china. the biggest carmaker in europe by far. and it became the biggest carmaker and then two months later the scandal hit. i guess the biggest take away is

just shows how important it is truly from a proper point of view, nevermind and more . a few for companies to have an ethical foundation. if you don't i think volkswagen shows that the people who ultimately pay the price are the employees who, in volkswagens case, are overwhelmingly hard-working honest people who may wind up suffering because volkswagen made itself vulnerable to a handful of graduate students with a $70,000 grant. so i'll be happy to take questions. thanthank you, everybody, for coming. [applause] if you had a question, please come to the microphone. >> i want to ask the question for seeking a writ and then i want to say some things about volkswagen. the question is, could they have modified these diesels?

because they certainly com, this a cost $5000 thousand dollars a car, would it say them an awful lot of money, because that isn't clear. my first volkswagen was i got out of the army in 1961. i had 40 had 40 miles on it and a kid being chased by the state police hit my rear tire at a light pic i took it in to the volkswagen or it was towed to the volkswagen dealer, and they white coated former panzer mechanic in charge of the department said, we will fix this car as good as new. i mean, it became a watchword among my friends about this. actually he couldn't because he couldn't get afraid and dad to give me a new volkswagen. i then had a super beetle around 1971971 and never had a volkswan again until the 72 model diesel. which was the best car i have

ever owned. it was fast, efficient, and i never spent i spen sent on maintenance in five years. i followed -- >> maybe you can get to the question. >> the question, the question was the first one. but i spent months dealing with them on getting the money for this car. i mean months on the phone as they changed the rules -- >> you mean the car you have now? >> right. they would say show up with this particular power of attorney, and i would show up with it and they would say you should have faxed today. i said doesn't say on the form, yeah, but you should have your second time, you didn't ask in your title. i said -- this went on and on until i stumbled my daughters gardner is a lawyer who turned out to be a class-action lawyer and a previous life.

and he knew the firm that was in the lead firm, and then i got things past due. but it took six months. i finally got paid last week. >> maybe i should expand what you're talking about is after volkswagen got caught there was then a class action suit which was settled and volkswagen owners had the option of either selling the cars back to volkswagen or taking compensation and getting their cars fixed up to a certain level. did you have a question? >> the question was, could they have upgraded these and avoided this whole payback? >> they could have. it would've cost more, i seem different estimates about how much more, but a couple hundred dollars. i mean, i think when you first start out they thought it was a stopgap, not something you're planning to do for almost a decade. i think they just wanted to get that first generation of cars into the u.s. market, and then they would improve the vehicles. but once they did it, it was

easy. it was cheap. nobody seemed to notice and it became a habit. they later did switch to a better technology. without getting too much into details but something that uses a tank of this solution to neutralize the nitrogen oxides.e technology. they switched to that started i think around 2012, but they were worried that the u.s. buyers without what to keep refilling the tank so they programmed it to sort of ration this fluid. and get it was a legal carter that would give it a very good time to have upgraded the technology and they would not have the problem that today, that they do. yes, sir. >> thanks very much. a great presentation. i especially enjoyed one of the ideas you got right at the end when you talk about looking to the future. you spoke in general about it's

not just volkswagen. you have some other examples of sort of poor corporate governance when you look at wells fargo and so forth. so the question is, do you sense because of those and other similar things that there's any sort of trend towards improving -- your suggestion for how to deal with this was yeah, management can be very ambitious, sort of implicitly set sort of ideal or arrangement are engineers, designers, workers, whatever, that they have to solve this problem or they have to reach these goals or whatever. their jobs are in the balance, but did not go be uncertain ethical limits. so how would that work? it seems to me if you tie your job to performance, keeping your

job to performance, rather than salary and compensation, that it's going to be extremely hard for an employee to make that ethical decision. one would be for the "faster, higher, and farther: the volkswagen scandal" governance in general to sort of get away from that think they're excited know if there's -- what do you think and do you see any signs of that kind of trend in corporate behavior? >> i agree with you that if you tell people that they don't meet the goal still get fired, that's also inviting bad behavior. as people think short-term. maybe somebody are thinking if i do this in five years ago to jail, but what's really on the mind is if i don't do this in three months i won't be able to pay my mortgage. and so i think you can't have these totally draconian penalties. i think it's probably better to have incentives but i think the other key thing is the top

management has to clearly express what are the company values and what are the ethical standards and then lit it themselves. it people below management level perceived that management is not really taking it seriously, it's all worthless. i think that's the crucial element. >> thanks. >> thank you. yes, men. >> i very much enjoyed this because i was in europe in october of 2017 when this broke out. i understand that volkswagen used slave labor during world war ii from the occupied, nazi occupied countries, is that correct? >> that's correct. i get into that in the book at some point, yes. >> thank you. >> what she's referring to is volkswagen like all remote all german companies during world war ii, they used forced labor, slave labor, whatever you want to call it, but volkswagen used

even more than most companies because when the war broke out it was a pretty new factor a didn't have a big workforce already and it's really kind of out of the sticks and julie. it's not near any urban areas so you didn't have this workforce that they could draw on. when the war started they had, sometimes people were sent voluntarily appear for occupied companies that were not volunteer with her and also people from consequent cramps including auschwitz. they had guards and towers. in some ways it was like a a concentration camp during the war. [inaudible] >> i don't think it was. >> i know, so you shouldn't -- i don't get that impression that it was but in waco the capital to force in europe on diesels are very, very strong and so you think the competitive finish it would've encrypted volkswagen by this defeat device would've a notice by its competitors who know to survive without also are

now being -- new lawsuits against fiat and even gm and mercedes and all the german makers eventually. so when is volume two going to come out? [laughing] do you see any hint of this doing research? >> i've written about that. one thing that people have realized as result of the whole volkswagen scandal is that basically in europe anybody was cheating in one way or another. the thing is that in europe, enforcement of emissions rules was basically a farce. it was really no enforcement at all. there's no penalties if you get caught the worst thing that happens is jeff to do a recall. so it's almost like an invitation for people to do it because the worst thing that happens is you have to install the technology you should've installed in the first place. and there's a growing realization of that. i think the big difference with volkswagen is they tried to

bring that kind of attitude to the united states. but to get back to your question, yes, i think, actualy because of volkswagen, volkswagen has 25% market share in europe or it's twice as big as the nearest competitor. so if volkswagen said something that's basic and policy for anybody else to compete unless they do it. the only difference was the companies selling cars in europe, they're still in the polls and the european rules, they could basically cheat legally. just been a lot of testing showing that the discrepancy between highway emissions of diesels in europe and the left emissions is enormous. people are realizing that and that's one reason why diesel market share is going down. leo? >> i'm just wondering in your research if you came across anyone from volkswagen who do that protesting had been done in

the past and was possible or was it that insular that nobody -- >> they don't seem to take it seriously and that's one of the mr. bera it's not like it was a secret in the industry. but one problem volkswagen is they had a headquarters mentality and the people thought they knew everything. they didn't listen to people at ground level. they are famous for not listening to other people in the united states were telling them about the u.s. market. they just don't seem to have taken that threat seriously, which obviously was a huge mistake. >> thanks. >> thank you, leo. >> follow up on that. your criticism of the european emission control regulators, was pretty slamdunk i guess. what's the political blowback going to be?

i assume this is making their day for the. >> it's a big political blowback. environmental groups have been saying this for years and nobody will listen to them. they have been saying for a long time if you look at what the actual nitrogen oxide levels are in urban areas in europe, they are way higher than they should be if the diesel, if the car covers were actually adhering to the standards. so the political, there's big debate is going on speedy a little follow-up if i may. i read that the was a move afoot to consider we juggling the taxes on gasoline versus diesel, which are very favorable to diesel, as sort of an almost anti-oil prices measured from the 1970s. it's an ancient policy now. he is that making any progress,

or -- >> i'm not sure what could happen, but just to give a little background to the rest of the eye does. in europe fuels basically subsidize because the tax issues about te ten senseless death for gasoline. it's cheaper at the pump and gasoline which is not the case in the united states. so policymakers actively promoted diesel because the carmakers had convinced him that it was cleaner than gasoline and particularly that it was less of a threat to global warming and also fuel-efficient. that's true about diesel. pick you have to say that i diesel engine burns more efficient than a gasoline engine. so the carbon dioxide output is lower than a gallon for gallon lower than gasoline engine. they neglected to look at the nitrogen oxide emissions and yes, there is a huge debate about that and i think things will change. thank you. >> in your reporting did you run across anything about a

successor class action for fraud in new york state for the vw rabbits were accessible conception? >> no. afghans of e-mails about that but i'm not aware of that. i am religious focus on the emissions issue. >> this was 1980s, and long time ago. >> that's a something i looked into, to be honest. >> thank you. >> thank you. >> so in the discussions, that it just taken place, the european regulating agencies have come up for criticism, and my question is whether the u.s. agencies that were in charge of writing and enforcing the regulations should also be criticized, in the sense that if they write a regulation, they should know the technology levels that are realistic and what has to be done to comply

with it. and it's almost like volkswagen came up with something that sounded too good to be true, so it probably was. and yet for years they were not found and they were not found with their own initiatives. it's other people who did work. it is primarily epa, have they come under criticism? have the dent any soul-searching and admitted that the process has to be better in the future, between technologies and enforcement? >> i think that's a very good point, that these cars were on the road for almost a decade without anybody noticing. part of the reason was that diesel it's such a small market share in the united states. i think volkswagen may be 80, 100,000 a year. year. it was a really big on anybody's radar screen but i think the other factor, this is some have talked to leo a lot about, is

that the regulators were very attached to their labs, their testing facilities which invested a lot of money in and they were very reluctant to do protesting. road testing. to be honest i think they still are. i don't perceive any wholesale change in their thinking. they are certainly more of where of ways the companies might sheet. my impression is they still think that they can change, they can use their labs to find that out, that they don't need to get into road testing which engineers don't like because they're so many variables you can't control. everything is in a lab, you can control the temperature that every car does exactly the same cycle. that appeals a lot to some engineers and scientists. i think they're still a reluctance to give that up. thank you. yes, sir. >> i'm a journalist. i'm a brazilian journalist in

d.c. so used to cover the case and the corruption there was deep. also leads to one impeachment and maybe to a second one. we really don't know. i wonder if you can compare both cases, volkswagen case and also the other case. because in that case it was like tens of people, maybe more than 100 people. also many construction companies were involved. one of them just signed a plea bargain with 77 executives over there. so how many people were involved in this volkswagen scandal? and also i would like to know if politicians were also involved. >> that's a good question. there is no exact number. my personal view from just reporting a dent is it had to be in the hundreds. this is something that went into numerous volkswagen models, and each car had to be configured separately. so it's hard to imagine how that

could have been done. volkswagen always tried to make it it was a small group of rogue engineers but that just didn't make sense. you need a lot of people to do this. there was a lot of discussion about it inside the company. it's hard for me to compare because i don't know so much about that case. but certainly it is amazing that so many people can be sort of swept up into a conspiracy like this, and then for top management to say they never found or heard anything about it. it. but that's what they say. >> a follow-up. was there any consequence in terms of any political consequence in germany? >> the second part of your question, this is something you suggested. i don't think it's proven that the politicians were aware that volkswagen was cheating. certainly the government is very

protective of the car industry and they have history of blocking ver realtor changes tht were bad for the german carmakers. and there's hearings in the german parliament that were looking exactly at that question, but as far as i know no one has proven that anyone in government knew about this. thank you. >> what is the role of audi in all of this? >> well, audi which is a division of volkswagen, and he is a lot of the same components, motors and so on, audi, the software that the use that could recognize the test site, that was actually invented at audi. the first diesel audi when you first read them up in the recalled they made a lot of noise. they came up with a function in the computer that and the car

was not being tested, they would adjust the fuel injection, some of the of the parameters so it was quieter when it was started because they did want a that something that would turn off buyers. if the car detected that it was being tested, then it would be noisy because they want to pass the test. and then what happened at volkswagen was when you're dealing with their initials problem, someone realized that audi, that the software was already in the computer and they adapted it for volkswagens purposes. so audi played a role, and audi in fact, separately paid a big settlement in the united states pic i forget the exact figure but it was summer under 2 billion. and so three had this illegal software as was some poor show.

audi doesn't seem be suffering as much, its reputation doesn't seem be something as much. people associate this with volkswagen. >> thank you. >> thank you. >> just a few days to happen to see a snippet in a newspaper, pricer fiat has been -- pricer fiat is the question of any summer situation. could you comment? >> the department of justice just last come was even this week or last week has sued fiat chrysler saying that there was also illegal software or that fiat chrysler was cheating on emissions rules and diesel pickup trucks and suvs, about 100,000 vehicles in the united states, we don't know how that's going to turn out or what it was about. it doesn't appear that there was a study done by some academic researchers who actually identified the software inside the fiat chrysler but it was less sophisticated than what

volkswagen had. it was according to the study just a timer that ran the emissions controls ar about 25 minutes after the car was started, and then cranked lower, and it happens that the official test last 22 minutes. that meant that they could be pretty sure that no tester would notice. fiat chrysler is disputing that this was a defeat device. but they're just been sued by the doj and daimlerchrysler is also being investigated a seems like something that is going to affect other carmakers, although i don't think anyone did it on the same scale in the united states as volkswagen or with the same sophistication. yes. >> i didn't catch whether you have drawn conclusions, generalizations in the book on this one incident. it obviously happens quite a

bit, or whether in the process of writing the book you were thinking about how that might occur so broad across companies and within the context of maybe the societal norms or like whether these things should be read that on a company basis, they should be on a societal basis almost. i would be really kind of interested what you thought about how these occurred and why they occur and what kind of incentives and things like that make them happen. or what it is in people and that kind of thing. >> you did cover that a little bit. just try to get you to expand a little more on that. >> i mean, the book is mostly about volkswagen. i did, there's a chapter go into that in a little more detail. i didn't do a systematic study of other companies and how this type of thing arises, but it's not that hard to come up with

other examples, enron, wells fargo. the banking crisis, deutsche bank, they all sort of follow that same pattern of cordless atmosphere -- corporate atmosphere where the visual breaking tolerated. there's very ambitious goals. >> you mention that the exact stress above and a testing and the order were a matter of public knowledge, are a matter of public knowledge which strikes me as a little bizarre. that companies would know exactly what they're up against as regards testing. do you think consumers would benefit by these tests being made more secret or else more random comparable? >> yeah i do. i think the losses cards are supposed to be clean basic or under any circumstances, and it is exception come in circumstances where the car needs to protect the engine or whatever needs to serve temporarily turned down the

controls, that supposed to be they discuss with the epa. >> as as a follow-up to think is realistic that might occur at any point since if you make completely secret, might that open up other avenues of corruption? >> i think, well, yeah, that might be a problem. it is asked on the upper thought about that much to be honest but i think it's fine just the sort of publicly known cycle but you should also do things to check whether the car is just tuned for the cycle or whether it can be clean under more or less normal circumstances. >> okay, sorry for double dipping. >> that's okay. >> very, question here, a compelling story like you did. are you in talks to make a movie or documentary? >> there's two documentaries in the works which they've interviewed me. i'm not involved in the

production one for netflix and one being done by the same guy who used to, who made the original woodstock documentary. then there's also, leonardo dicaprio production come has bought the movie rights to the book, and their working with paramount, and from what i can perceive from my point of view is they are serious about making a movie and is going forward. so yes. >> hello. can you talk about some of the challenges -- [inaudible] ongoing investigation for instance, did you uncover information that the justice department is now curious to know more about? can you talk about your sources? what were the challenges of trying to write a book in the middle of an ongoing investigation? >> that was a challenge.

the way we did it was they approach me, a couple weeks after the story broke and he said he wanted a book in here which is pretty tight to write a book and a special a working full-time. and the new times is actually more than full-time. but the way i did it is i just started chronologically with a company history writing one chapter after another on weekends and giving them to john as i finish them. to be honest i was very nervous whether within a year i would know enough to be able to write a story that kind of had a logical ending. but as it turned out that was possible. just the hardest thing about reporting was of course getting people with inside knowledge to talk to me. i was successful in getting a number of people who read very close dollars of what was going

on to speak to me on a confidential basis. and the way i did it was pretty simple actually. i was able to figure out some of the name some academic papers or patents, who had worked on the emissions at volkswagen. then i just wrote them letters. i wrote a lot of letters, sometimes multiple letters to the same people and those people did respond but enough did that i was able to get i think a pretty good picture of what was going on inside volkswagen. and then when they year was up, it happened at volkswagen had settled in the u.s. so that was kind of, gave the book the conclusion although there continue to be development and a continued to write about it for the "new york times." the epilogue in the book, edible and turn turn the manuscript in in november last year, we were adding to the epilogue recent developments and i think march

before the book finally had to go to press and then i could at any more. i'm hoping for a future edition or paperback edition or whatever it that i can continue to sort of enhanced because i'm always learning new things. i'm hoping to keep making it better. >> i would like to know whether there were non-german car manufacturers that tried to enter use their diesel version into the united states? i do remember there was a turbodiesel in the '80s and i wonder whether there were other non-german -- >> i don't think there, there were parts of others but i don't think anybody really got traction. >> may i mention that i badgered my volvo did because i driven volvo diesels in europe and there were always diesels running around, clean diesels. so i said why can't you of a diesel here? like edge of a diesel?

50 miles to the gallon, right? he said we tried. we tried but we get rejected. >> i think there are probably best but when volkswagen in 2081 volkswagen for started the clean diesel advertising blitz, there was something like 16,000 diesel passenger cars in the united states, a very small number. simulated and been successful at it. volkswagen was pushed and i did mention that but those another one of the big mistakes in it was they did this clean diesel advertising campaign that was quite extensive come super bowl ads, very clever advertising, and they were pretty successful in getting people were environmentally conscious to buy the cars. that's one reason what about it being so expensive because it was that or the illegal software but this huge consumer fraud. i get emails still all the time from people who it said i was looking at a previous and they convinced me this was as clean

as a prius unles adjustable-ratt as you can imagine. >> so i think that seemed all the questions. so thank you very much for coming. i really appreciate it. very happy to sign books. [applause] >> [inaudible conversations] [inaudible conversations] >> booktv recently visited capitol hill to ask members of congress what they are reading this summer. >> this one book and reading now just about finished, it is sebastian youngers both called a tried and he's the author of perfect storm.

i share the veterans affairs committee washington and it's a book about ptsd, reintegration of our veterans back into society. if it great book i recommend you read it. i serve also as the culture of the literary caucus year in washington, and one of the things i encourage a want to do read this summer, obviously we read a lot of very boring things here in washington, a person policy papers and all that, but just for fun this summer i'm going to read david ball dodgy. i read every book that he has ever written. starting with his first one and have never given up on him. he's a great writer. also i want to read the booklet and to check. >> the reason i bring that is andrew jackson was a first-person to hold my congressional seat. in tennessee where i live the district other than has had to president come one is andrew

jackson, the others andrew johnson. so those of folks i like to red about this summer. >> booktv wants to know what you are reading. send us your summer reading list via twitter @booktv or instagram at book underscore tv or posted to our facebook page facebook.com/booktv. booktv on c-span2, television for serious readers. .. >> we can start with the biggest question of all, which is, why were you compelled to write this