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Source link: http://archive.mises.org/10213/free-bernie-madoff/

Free Bernie Madoff

July 2, 2009 by

What is the point of jailing him? He is no direct threat to anyone. Society would not safer with him in the slammer. He is not going to rob people or beat people up. He might write a book and donate the funds to charity or make some restitution to his victims. I, for one, would like to read that book. Instead, taxpayers will be forced to pick up the tab for his living expenses until his death. FULL ARTICLE

{ 119 comments }

MHnTX July 4, 2009 at 12:52 pm

It has always puzzled me how anyone dealing with reality can espouse Anarchy in any form. As a person who is opposed to collectivist ideology I still find it incomprehensible that anyone would think men rational enough angels capable of living in the real world without some form of enforceable rule of law contract.

In a world full of productive and peaceful John Galt’s government – or very little — would be necessary but to try and translate that vision practically into a world full of irrational barbarians would be suicide. Without reasonable rule of law, enforced thru the threat of lose of liberties by those who violate the natural individual rights of others, the civilized world would simply fall apart. How this does not make sense to anyone is a mystery to me.

Ivory tower dreaming about what could be is great fun at times but to actually advocate for an impossible political system – in today’s terms — seems no more rational than what many of the collectivist intellectuals have done.

George Bush was a supposed friend to freedom and capitalism and yet his ideological faults led him to harm it more than help it, and in that sense, I feel the Anarchist wing of the libertarian movement does the same exact thing.

Perhaps Mises.org should at least set up an Ivory Tower Fantasy section so that, at the very least, new people coming to the site won’t mistake us all as advocates of the impossible in the real world.

michael July 4, 2009 at 1:46 pm

A word needs to be said about deterrence.

When it comes to ignorant, impulsive and desperate crimes (the crimes of most ordinary inmates) deterrence famously does not work. As this class of people tends to have little control over their lives and actions to begin with, anything you can do to or with them is after the fact.

But when it comes to financial fraudsters, these are people very much in charge of their activities. We sentence Bernie Madoff to deter the flood that would come after him, were he not severely punished.

Once the floodgates had opened we’d never be able to trust anyone again. It would be open season on investors.. and no one would be able to arm himself against the ever more sophisticated scams targeted toward the careful and the methodical. Our financial markets would cease to function.

Walt D. July 4, 2009 at 6:02 pm

michael said
“A word needs to be said about deterrence.”
The key thing about deterrence is the certainty of punishment and not the severity.
In England during Dickensian times, minor crimes were punished by the death penalty. They would hang people for pick-pocketing. To deter people, there were public hangings outside Newgate Prison. Large crowds used to gather. Thieves would take advantage of the hustle and bustle of the large crowds to pick peoples pockets!
It was the fact that Madoff new that the SEC would do nothing that encouraged him to keep the scam going.

Gil July 4, 2009 at 9:01 pm

Nope, J. Fedako, ‘have to pay’, unless they think it isn’t worth it. As I wrote near the top – in Libertopia, a victim’s insurance payments are going to up after they make claim or, if they don’t have insurance companies and victims have to do a DIY form of retribution then they still have to take time out from their regular lives to do that too.

ethan July 4, 2009 at 9:33 pm

Walt D.
I love this anicdote about the pickpockets in Dickensian England. Do you have a reference?

Jim Fedako July 4, 2009 at 9:58 pm

Gil,

“As I wrote near the top – in Libertopia, a victim’s insurance payments are going to up after they make claim”(my emphasis)

Interesting proposition. Now prove it.

Gil July 4, 2009 at 11:45 pm

Gee, what happens to those who prang their car and claim insurance?

Jim Fedako July 5, 2009 at 7:57 am

That’s not a proof of your proposition.

In that vein, I’ll make a counter claim: I got a new roof due to storm damage and my rates remained the same at renewal.

Instead of anecdotes, how about some proof.

Gil July 5, 2009 at 9:54 am

But if people are paying the same rate afterwards then other people are ‘chipping in’ to help cover the costs of crime.

Uri DeYoung July 6, 2009 at 5:41 am

There is no way that Madoff can pay restitution to his victims — even if he were indentured for the rest of his life to a legitimate investment firm and 90% of the revenue that he earned went to repay his victims (the remaining 10% going to the firm for their trouble).

There’s nothing left to do with him. Off with his head!

Steff July 6, 2009 at 7:00 am

Why don’t people get locked up for the biggest Ponzi scheme of all: fractional reserve banking?

ganpalou July 6, 2009 at 7:57 am

I was hoping for some creative or sarcastic comments in reading Tucker’s article. Instead, I got a review of the early 1960′s pap (before the “revolution” sold out for 50 cents-a-hit Osley Orange). The comments suggest we have forgotten, as a culture, that we have already gone down this road.
I am concerned that the people who “get it” seem to be uptight about the role of government in general, and prisons in particular. I think we place government on too high a pedestal. The primary goal of government is to survive. To survive, a government must have a predictable flow of taxes. The people must engage in producing valued commodities and services in order to be taxable; we can’t just make garbage and pollution. To produce valued services and commodities, the people need to be healthy and prosperous; therefore, protecting health and prosperity is a necessary burden to government. Further, government must set rules which encourage productive activity, and must limit its interference and plunder of the people. It seems to me that this is the core of the Mises teachings, and is the source of my anxieties over the actions of my government.
As a people, we wish to constrain government to activities which enable it to survive. We wish to be healthy and prosperous. It is within these constraints that we devise the justice and prison systems. We make it difficult and expensive to deal with those who interfere with our health and prosperity, and who also interfere with the predictable flow of taxes.
Of course Bernie should go to prison. He interfered with prosperity and the flow of taxes. And there are plenty others. Paulson and Bernanke do come to mind, but they are reacting to the banking and brokerage execs who wont do business with each other without a bribe, as they know their peers are crooks. If you feel avenged, or blood lust, or have dreams of humiliating others, that is your personal issue. Bernie going to prison is just business.
As for the horrors of prison, I have not yet excluded Federal prison from “retirement plan ‘F”, if all else fails. Lompoc would be my choice. It is near Santa Barbara Ca., so the weather is nice, and a “good inmate” can get day-passes on weekends to go downtown or to the beach.

EnEm July 6, 2009 at 2:31 pm

So suckers like Tucker are still around. He appears to be in a class by himself. I say we do as he says and release Madoff from prison and then send him after Tucker!

Franklin July 6, 2009 at 6:46 pm

“I was hoping for some creative or sarcastic comments in reading Tucker’s article,” says ganpalo.
“Instead [it was] 1960′s pap before the ‘revolution’ sold out…”
Ha! I think you provided the much-needed satire yourself. Very nicely said.
“Retirement Plan ‘F’” indeed.
: )

Michael July 7, 2009 at 4:01 pm

I agree, public embarrassment is the worst to the psyche of anybody. For instance public speaking is tough for MOST people from the fear of public embarrassment.
One point to make is about the 150 years sentencing. He questions why such a high sentence, probably because the mass population cares about their money more.
Great comparison to social security than next big recession of the United States.

BT July 20, 2009 at 4:09 pm

To all crazies posting here:

You miss several points:

1) The punishment is to act as a deterrent to future would-be con artists.

2) Madoff can still write his book while in prison. Then, any money made off his sold copies can go to repay his victims.

3) Madoff would never be able to repay his “debts” thus jail time is appropriate.

4) Madoff could never generate enough revenue over his remaining useful life to pay back 50 billion dollars!! The 50 billion would have to be profit! This would require something on the order of 500 billion to 1 trillion in revenue!!!

5) Even if he could generate that kind of revenue, what would keep him from taking people for another ride in his new revenue-generating pursuit? NOTHING!!!

6) If left to individuals instead of the state, I assure you Madoff would already be dead!! Which is worse to libertarian crazies? Death or imprisonment?

7) Many of you crazies make some good and correct points; however, most of your posts eventually slip off into Utopialand and lose touch with reality, common sense, and a reasonable, logical argument!

You crazy libertarians are so funny….none of you seem to be living what you preach!! If you like lawlessness, move to the continent of Africa!!! I assure you, you will find plenty of it there. Until then, shut up, quit smoking crack, and get out and find employment!!! Your arguments are so poorly contrived that a third grader has better ideas!! I think most of you posting here are lazy, elitist intellectuals (or losers)….translation – college students.

BT July 20, 2009 at 4:18 pm

Hey Moron Mark Hughes:

Question: Who do you think is going to pay for the audits and the security for Madoff? The taxpayer, the corporation that hires him? Give me a break, no one would hire him; it would cost the company too much lost revenue from the negative publicity!!!

I am going to resort to an ad hominem attack (oops): YOU ARE A FREAKIN’ IDIOT!!! I hope you (and others like you) remember your rants when your number comes up. In fact, how about I get a hacker buddy of mine to steal your identity? It would give you a chance to put your belief into practice!!!

Jim Fedako July 21, 2009 at 9:54 pm

Gil,

That’s the essence of insurance.

Jim Fedako July 22, 2009 at 9:39 pm

To clarify, the essence of insurance is shared risk. So payments do not rise bases on a singular event.

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