For fucks sake can we stop doing flat dollar amount fines on megacorps and do percentage of revenue - yes, revenue specifically, not profit, which can be gamed in tons of interesting ways - as punitive measures? Even astronomical 8 or 9 figure fines on companies with market caps in the ballpark of a trillion fucking dollars are effectively brushed off as the cost of doing business, and are ultimately inconsequential and entirely ineffective in terms of serving as a meaningful deterrent to the things they’re being fined for.
Meta is not going to give a single shit about this. This is a small speed bump, nothing more.
8 and 9 digit fines aren’t astronomical for them (which, I realize, is the point of your comment; I’m just saying this fine is even more a complete nothingburger). Even if you go into 10-figure fines, you’re still in the range where they make it back within the week.
You’ve got to get into the 11-digit range before it starts to hurt, and the 12-digit range before it starts to send a message.
But while I agree that we shouldn’t use profits, I’m not sure about revenue. That’s definitely better, but I think we should target the number they’re actively encouraged to pump as high as possible: market capitalization.
That specifically affects how much they can pull in investment and lending, which can keep them going even if they have zeroes or net-negatives at the bottom of their balance sheet; and it’s the number they’re incentivized to make look as big and beefy as possible, so trying to wiggle out of a fine by making that number smaller might well hurt them more than just paying the fine.
A lot of companies since Jack Welch oozed his way into executive roles have lived on market cap and vibes for years without turning a profit or making much in revenue at all. Sure, for younger companies, or newly-public ones, they might have a higher annual revenue than their market cap. Maybe we could say “revenue or capitalization, whichever is higher.”
In the case of Meta, their market cap is $1.5T on $220B of annual revenue. Fining them 15% of their market cap would erase a whole year of revenue; that would send a message.
For companies like this, punitive fines need to legitimately threaten to put the business under. Especially when it’s not their first offense. Fines totaling 15% of market cap, with the percentage doubling for each offense after the first, seem like they’d be effective in changing behavior; and if they don’t, then the company gets fined into nonexistence after two or three strikes. Problem solved either way.
For fucks sake can we stop doing flat dollar amount fines on megacorps and do percentage of revenue - yes, revenue specifically, not profit, which can be gamed in tons of interesting ways - as punitive measures? Even astronomical 8 or 9 figure fines on companies with market caps in the ballpark of a trillion fucking dollars are effectively brushed off as the cost of doing business, and are ultimately inconsequential and entirely ineffective in terms of serving as a meaningful deterrent to the things they’re being fined for.
Meta is not going to give a single shit about this. This is a small speed bump, nothing more.
8 and 9 digit fines aren’t astronomical for them (which, I realize, is the point of your comment; I’m just saying this fine is even more a complete nothingburger). Even if you go into 10-figure fines, you’re still in the range where they make it back within the week.
You’ve got to get into the 11-digit range before it starts to hurt, and the 12-digit range before it starts to send a message.
But while I agree that we shouldn’t use profits, I’m not sure about revenue. That’s definitely better, but I think we should target the number they’re actively encouraged to pump as high as possible: market capitalization.
That specifically affects how much they can pull in investment and lending, which can keep them going even if they have zeroes or net-negatives at the bottom of their balance sheet; and it’s the number they’re incentivized to make look as big and beefy as possible, so trying to wiggle out of a fine by making that number smaller might well hurt them more than just paying the fine.
A lot of companies since Jack Welch oozed his way into executive roles have lived on market cap and vibes for years without turning a profit or making much in revenue at all. Sure, for younger companies, or newly-public ones, they might have a higher annual revenue than their market cap. Maybe we could say “revenue or capitalization, whichever is higher.”
In the case of Meta, their market cap is $1.5T on $220B of annual revenue. Fining them 15% of their market cap would erase a whole year of revenue; that would send a message.
For companies like this, punitive fines need to legitimately threaten to put the business under. Especially when it’s not their first offense. Fines totaling 15% of market cap, with the percentage doubling for each offense after the first, seem like they’d be effective in changing behavior; and if they don’t, then the company gets fined into nonexistence after two or three strikes. Problem solved either way.
Take all Facebook executives and decimate the group.
This is the only correct response.