If people are coasting at home OR at the office you can tell that by their work output. Where they do their work doesn't enter into it.
Adopting a Results Only Work Environment (http://gorowe.com) would allow them to have folks who work from anywhere and give management the tools to fire under-performers.
If this were only a temporary measure, a "reset" so to speak, then I still don't agree with it (I think you can do that without the disruption), but it would be understandable. As they have not said that this is temporary, I have no reason to think it'll come back in the future, which is the tragedy.
It doesn't have to be like this.