It's why Facebook's $5bn FTC fine is laughable too. You need to fine them an amount relative to their market capitalization to really make 'em feel it, probably around 10%. I'd go as far to say, one would need fine them in the $50-$100bn range to really stop them from doing something (same for any of the $500bn+ companies).
If it's profitable to be shitheads, they're are going to account for it, and be shitheads.
A fine of 10% of market cap is close to the company's gross revenue. This is equivalent to a government owning the company. This "smells" like communism mentality.
What you're saying is that fines large enough to actually affect the company, to make their shareholders realize a loss of (monetary) value as a result of bad management, is communism?
That to me is simply insane, and I'd highly encourage you to go take some upper division economics courses before rattling off what is and isn't communism.
The idea that it won’t have any effect on Facebook’s behavior in the future is laughable.
He loves money just as much as everyone else.
1. FB's market cap is $573bn. 10% is $57.3bn. 2019 Q2 profits were $1.6bn.
2. By your standards, it is perfectly fine for a government [entity] to tell a private company: "If you don't do exactly as I ask, I will get all your profits for roughly the next decade." That, according to you, would be teaching FB "good behavior." To quote you, it will "really make 'em feel it".
3. Communism is a system of government in which the state plans and controls the economy and a single -- often authoritarian -- party holds power.
Maybe you should rethink your views.
If we want these sorts of businesses/behaviors to stop cropping up, we need to make societal harm a huge risk factor for investors.
Of course it is perfectly fine and within your rights to believe and say that the world would be better off without FB (and Google no less!) but you must understand by now that your opinion is that of a tiny minority.
To answer in good faith however: I do agree with the spirit of what you are saying. Companies should be held accountable and fines are probably a good tool to achieve that.
2. If you're only looking at profits, then you're missing the entire point of running a business like Facebook, because that's not the point. The point is to increase shareholder value whether that's actual profit, or an increasing stock value. To only look at their profit, which can be easily manipulated with GAAP accounting, is pretty much negligence. Look at Amazon choosing to run in the red for decades...
3. Communism isn't a system of government. It's an economic system, that is to say a system for managing resources.
QED
P.S. One last thing, you work at Google, of course you're going to be against these fines or proposing them.
The amount of fines are balanced to ensure:
- minimal legal pushback from FB side
- quick pay.
- make sure it's repeatable process (i.e. FB do what they want to generate revenues. FTC succeeds in fining FB with accompanying political wins, bonuses and promotions that somes with it)
Rinse and repeat.
The line where the EU fine is marked is in the table of revenue vs. costs & expenses as part of an accounting formula: "Revenue - Costs = Income from operations". Even if you were planning to stop paying it in 2020, where else would you list the fine?