I agree with your overall point, but:

> But that abuse is really capped out at a few thousand

That abuse easily goes into the tens of thousands of dollars, even several hundred thousand, even at a relatively small shop. I just took a quick look at Apple's store, and wow! The most expensive 14" MacBook Pro I could configure (minus extra software) tops out at a little over $7,000! The cheapest is at $1,600, and a more reasonably-specced, mid-range machine (that is probably perfectly sufficient for dev work), can be had for $2,600.

Let's even round that up to $3,000. That's $4,000 less than the high end. Even just one crazy-specced laptop purchase would max out your "capped out at a few thousand" figure.

And we're maybe not even talking about abuse all the time. An employee might fully earnestly believe that they will be significantly more productive with a spec list that costs $4,000, when in reality that $3,000 will be more or less identical for them.

Multiply these individual choices out to a 20 or 40 or 60 person team, and that's real money, especially for a small startup. And we haven't even started talking about monitors and fancy ergonomic chairs and stuff. 60 people spending on average $2,000 each more than they truly need to spend will cost $120k. (And I've worked at a place that didn't eliminate their "buy whatever you think you'll need" policies until they had more than 150 employees!)