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Two senators say a $5B fine isn’t enough to punish Facebook

arstechnica.com

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Re: Two senators say a $5B fine isn’t enough to punish Facebook

#51

Post by burtonator »

tptacek wrote: post #37

This is kind of alarming to me. A fine should scale with the the greater of the harm done and the amount needed to deter the behavior. But that's not what's happening here; instead, people are proposing that the fine scale with Facebook's total revenue. Even Facebook's most ardent critics probably don't believe they derive a majority (or really even a significant amount) of revenue from the lax API controls companies…

Another key point. It should not just deter Facebook but OTHER companies considering the same action.

Re: Two senators say a $5B fine isn’t enough to punish Facebook

#52

Post by SubiculumCode »

tptacek wrote: post #37

This is kind of alarming to me. A fine should scale with the the greater of the harm done and the amount needed to deter the behavior. But that's not what's happening here; instead, people are proposing that the fine scale with Facebook's total revenue. Even Facebook's most ardent critics probably don't believe they derive a majority (or really even a significant amount) of revenue from the lax API controls companies…

Maybe. On the other hand, historically there have been too many 'slap on the wrist' punishments that don't even reach the total profit that was by the illegal activity....and that definitely sends the wrong message.

Re: Two senators say a $5B fine isn’t enough to punish Facebook

#53

Post by adventured »

Avshalom wrote: post #49
tptacek wrote: post #37

This is kind of alarming to me. A fine should scale with the the greater of the harm done and the amount needed to deter the behavior. But that's not what's happening here; instead, people are proposing that the fine scale with Facebook's total revenue. Even Facebook's most ardent critics probably don't believe they derive a majority (or really even a significant amount) of revenue from the lax API controls companies…

I mean first fines pretty much have to scale with total revenue to deter behavior second 5 billion won't even lead to an unprofitable quarter at 2018's numbers so there's a loooot of room between 5B and an existential fine, we aren't any where near the slippery part of the slope.

> I mean first fines pretty much have to scale with total revenue to deter behavior

That's only an effective approach if your goal is to cripple many of the companies that you fine. Almost no large companies on the planet have the extreme profit margins of Facebook. Alternatively to avoid that kind of damage you have to adjust the percentage scale to each individual company's profit margins (25% revenue fine for Facebook, N% for a retailer with microscopic 3% profit margins), which instantly makes the revenue approach absurd.

Slap 3M, Walmart, Caterpillar or Costco with the equivalent of a ~25% quarterly revenue fine, and you'll do severe damage to the company. A 25% quarterly fine on Walmart's revenue would nearly bankrupt them. As opposed to Facebook which has profit margins 15-20x greater than eg Costco and can more or less absorb the fine directly out of its quarterly profit.

I don't see the argument behind using fines as a means to intentionally severely damage companies, which is what huge revenue-based fines accomplish.

Re: Two senators say a $5B fine isn’t enough to punish Facebook

#54

Post by yeahitslikethat »

tptacek wrote: post #37

This is kind of alarming to me. A fine should scale with the the greater of the harm done and the amount needed to deter the behavior. But that's not what's happening here; instead, people are proposing that the fine scale with Facebook's total revenue. Even Facebook's most ardent critics probably don't believe they derive a majority (or really even a significant amount) of revenue from the lax API controls companies…

Human beings as persons face existential punishment every day.

Corporations a persons -- never.

That's why they get away with this stuff no one thinks is good.

Re: Two senators say a $5B fine isn’t enough to punish Facebook

#55

Post by hulahoof »

Angostura wrote: post #41
salimmadjd wrote: post #26

my cynical side says there is more to this. I think FB is a major threat to the distribution of news that is mostly owned and controlled by the mainstream media owners. I think this is all part of forcing FB to come to the negotiation table, and negotiate banning more independent information sources to make these fines go away.

I don't think Fox News really cares about Facebook

Why would you think that ?

Re: Two senators say a $5B fine isn’t enough to punish Facebook

#56

Post by yeahitslikethat »

LanceH wrote: post #50
crankylinuxuser wrote: post #36

Earlier quoted context omitted.

1. Execute the company (dissolve the charter) 2. throw the board collectively in jail for a time for inaction of illegal actions leading to death 3. charge all who conspired to subvert laws as a co-conspirators to premeditated murder 4. Liquidate the company and pay back shareholders not in C levels, the Board, family thereof, or people charged with aforementioned crimes Strong enough?

How about just jail the programmers and engineers since they are the only ones who ever have a record of what went on.

Wouldn't be the first time programmers were the only ones to do time for a company's crimes.

But when I'm asked to implement robosigning and push back now I'm the bad guy. I won't do it, but another dev did against my and the other developer's advice. He'll be fine I'm sure. No one will notice.

Re: Two senators say a $5B fine isn’t enough to punish Facebook

#57

Post by tptacek »

burtonator wrote: post #51
tptacek wrote: post #37

This is kind of alarming to me. A fine should scale with the the greater of the harm done and the amount needed to deter the behavior. But that's not what's happening here; instead, people are proposing that the fine scale with Facebook's total revenue. Even Facebook's most ardent critics probably don't believe they derive a majority (or really even a significant amount) of revenue from the lax API controls companies…

Another key point. It should not just deter Facebook but OTHER companies considering the same action.

Sure! Facebook makes more money managing private information than virtually any other company. What's the larger company they'd need to deter?

Re: Two senators say a $5B fine isn’t enough to punish Facebook

#58

Post by tptacek »

yeahitslikethat wrote: post #54
tptacek wrote: post #37

This is kind of alarming to me. A fine should scale with the the greater of the harm done and the amount needed to deter the behavior. But that's not what's happening here; instead, people are proposing that the fine scale with Facebook's total revenue. Even Facebook's most ardent critics probably don't believe they derive a majority (or really even a significant amount) of revenue from the lax API controls companies…

Human beings as persons face existential punishment every day. Corporations a persons -- never. That's why they get away with this stuff no one thinks is good.

Something, something, two wrongs, something.

Re: Two senators say a $5B fine isn’t enough to punish Facebook

#59

Post by yeahitslikethat »

tptacek wrote: post #38
mtgx wrote: post #35

Earlier quoted context omitted.

Banning the 737 Max from flying in the U.S. forever would be a good start, I'm thinking. It could be a decent lesson for airplane makers (and self-driving car makers) at least.

Why not just ban all of Boeing's planes from flying? That would teach Boeing an even greater lesson.

Do that until all the 737max's are fixed and I bet they are fixed in a hurry.

But I'm sure your sarcasm means you think the economic impact will be worse than the lives lost in the pursuit of financial preservation.

Money is worth more than lives right?

Re: Two senators say a $5B fine isn’t enough to punish Facebook

#60

Post by Avshalom »

adventured wrote: post #53
Avshalom wrote: post #49

Earlier quoted context omitted.

I mean first fines pretty much have to scale with total revenue to deter behavior second 5 billion won't even lead to an unprofitable quarter at 2018's numbers so there's a loooot of room between 5B and an existential fine, we aren't any where near the slippery part of the slope.

> I mean first fines pretty much have to scale with total revenue to deter behavior That's only an effective approach if your goal is to cripple many of the companies that you fine. Almost no large companies on the planet have the extreme profit margins of Facebook. Alternatively to avoid that kind of damage you have to adjust the percentage scale to each individual company's profit margins (25% revenue fine for Face…

Fair enough I used 'total revenue' instead of total profit to make it clear which part of the paragraph is was arguing with. However it's not profit margin but overall profit: Walmart might have thin margins but they still made ~20B in profit: they too could absorb a $5B fine. Costco could eat a billion.

But purposely damaging a company is exactly what a fine is for. It's punishment and deterrent.

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