Give Madoff The Chair

The Wall Street Journal published an article the other day entitled “Bernie Madoff, the $19 Billion Con, Makes New Friends Behind Bars.” Within the medium security prison, Mr. Madoff is well respected. “[I]n a federal prison that houses men convicted of crimes including embezzlement, bank robbery, espionage and drug dealing,” Madoff is the king; “People wanted his signature because they wanted to sell it on eBay.”

Not to sound fatalistic, but there are some people who simply can’t be punished. Things seem to always roll in their favor and they find a way to make the best of everything. But luckily Madoff wasn’t sent to prison to be punished or to prevent him from starting another ponzie scheme; he was sent to prison to send a message to Wall Street.

On another note, I am opposed to the death penalty in general for several reasons. In a more general sense, I don’t believe it’s in anyone’s best interest for the government to be in the killing business. There is also the issue of cost. It is cheaper to keep an inmate in prison his whole life than to kill him. There is the concern of killing someone who is innocent. Then there is the key issue for me, which is that it probably doesn’t deter the people we would want it to deter. The criminals who are generally considered for the chair are serial murderers and things of that nature. People who commit those crimes are sociopaths who don’t respond to obviation. When mass murderers plan horrendous acts they don’t consider the consequences in a rational way because they are unequivocally irrational. This makes deterrents like the death penalty futile.

Which brings me back to Madoff. Sending him to prison wasn’t to teach him a lesson; he had already lived most of his life with the perks and luxuries that come with running a ponzie scheme. He wasn’t sent to prison to protect the general public from him. He was sent to prison as a deterrent to future ponzie schemers. The difference between ponzie schemers and murderers is that ponzie schemers are rational. They see an opportunity to take advantage of other peoples’ greed by taking their money and promising unsustainable profit. They weigh the risks and make a decision.

After Michael Milken’s mere 22-month sentence in the early 90’s, who among us wouldn’t trade under two years in prison for unbelievable wealth? (Sadly, in Milken’s case, he also had cancer along with his wealth.) For that matter, who wouldn’t trade lives with Madoff? If you could spend 70 years as a rich man and give your family enough wealth to last many generations at the cost of spending the last 20 or so years of your life treated nicely in prison⎯would you do it? I certainly would. Many people spend the last 20 years of their lives in old folks homes (which are awfully similar to prisons) and they never got to be stinking rich.

Now lets add a twist. If the consequence for ponzie scheming was the chair, we would all feel differently. It is one of the few cases where the deterrent actually deters. Someone would have to possess a whole lot of hubris if he wanted to start a Ponzie scheme knowing full well he would receive the death penalty if caught. Which is why I say send Madoff to the chair. Give the folks on Wall Street a reason not to Ponzie scheme.