The phrase “cost of doing business” doesn’t mean “bankrupt” or “righteous penalty”, it means, especially in this context, that it’s an normalized and accepted business expenditure because of our corrupt regulatory system whereby white collar crime is NOT punished by meaningful punitive actions that would create a deterrence. Instead, any punitive measures can simply be accounted for as a “cost of doing business”.
Let me give you a hyperbolic but extremely simple example:
CEO: Let’s commit a fraud worth $100m
VP: But that’s illegal
CEO: Yes, but the fine would only be around $5m
CFO: Perfect, I’ll add a $5m expenditure under the “cost of doing business” line item
VP: Wow, that’s a great $5m expenditure, we’ll net $95m in profit
I’m aware of what you are saying and I agree but only to a point. I’m saying that even as a “normal” cost of doing business the size of the fine is not normal. To take your example it’s like this:
CEO: “Lets commit 32 BILLION dollars of fraud.”
VP: “That’s illegal.”
CEO: “Yes but the fine would only be around $5m.”
VP: “Sir, I’m not condoning this but that estimate seems absurdly low for the size of the fraud?
CEO: “You’re right, the fine should be much much higher. Can we afford to get a $500m fine as a normal operating cost?”
CFO: “We can. I’ll also talk to my connections in Washington to get the amount lowered and anything else will be gravy. Also, VP you’re fired!”
The phrase “cost of doing business” doesn’t mean “bankrupt” or “righteous penalty”, it means, especially in this context, that it’s an normalized and accepted business expenditure because of our corrupt regulatory system whereby white collar crime is NOT punished by meaningful punitive actions that would create a deterrence. Instead, any punitive measures can simply be accounted for as a “cost of doing business”.
Let me give you a hyperbolic but extremely simple example:
Make sense?
I’m aware of what you are saying and I agree but only to a point. I’m saying that even as a “normal” cost of doing business the size of the fine is not normal. To take your example it’s like this:
CEO: “Lets commit 32 BILLION dollars of fraud.”
VP: “That’s illegal.”
CEO: “Yes but the fine would only be around $5m.”
VP: “Sir, I’m not condoning this but that estimate seems absurdly low for the size of the fraud?
CEO: “You’re right, the fine should be much much higher. Can we afford to get a $500m fine as a normal operating cost?”
CFO: “We can. I’ll also talk to my connections in Washington to get the amount lowered and anything else will be gravy. Also, VP you’re fired!”