Yeah, "we hired people we shouldn't have so now we're going to make it increasingly unpleasant to work here" doesn't work. First-hand, what I've seen happen is that your most talented people, who are the most in demand, leave the organization quite quickly because they correctly realize they don't have to put up with this bullshit. It's the coasters who fear they'll never land an equally cushy job who attempt to ride…
and go where? most people are there for the money, pretty much only roblox, gambling, crypto and few others pay similar to fb or above, and its unlikely its much nicer there
IME your top performers are generally less compensation motivated than "interesting problem and interesting environment" motivated. Many companies will bend over backwards to give a top performer from a FAANG as much autonomy and interesting work as they want, for compensation differences that aren't that major anymore.