Is this something we can really calculate so closely? What if it turns out the banks are better at such calculations than the government, and crime is profitable?

Personally, I feel there's a disparity here between punishment for the rich (make the fine slightly higher than the expected profit) and the poor (put them in a cage for years).

No he wasn't. He was arguing against scaling up fines based on a company's general profits. The formula given simply said that the fine and the chance of being caught should be greater than the profit from the illegal activity. How much greater was unspecified.

> Personally, I feel there's a disparity here between punishment for the rich (make the fine slightly higher than the expected profit) and the poor (put them in a cage for years).

I agree with that, but don't feel that scaling fines resolves the issue that poor criminals land in jail while wealthy criminals don't even pay their own fines (instead the corporation does). You don't fix this discrepancy by raising fines on the wealthy.

However great the difference between the expected profit and the fine, a purely financial penalty for crime will always encourage three things: gambling, trying outsmart the government by finding ways to make more profit or reduce the chance of being caught, and rich people ignoring the law and committing the crime for non-financial reasons (for example: thrill seeking, as a favor to someone, to enable another crime, or from pure malice) with no real penalty to them.

I think we both agree jail is a more appropriate punishment, though we're making the argument in different ways.