The trial is about to start — jury selection began yesterday — for two Enron executives, Kenneth Lay and Jeff Skilling, accused of criminally defrauding investors. On All Things Considered this afternoon, NPR talked with two former Enron employees, both of whom have recovered from Enron's fall. One of them, Lois Black, said that she had lost 75% of her retirement savings that was in Enron stock. When asked, she also said that she doesn't know what their punishment should be.
I have long been a fan of alternative punishments. That we usually lock people up is an admission that we don't have the resources to control them otherwise. It makes sense to lock up the burglar who will break into another house, or the armed robber who will knock over another convenience store otherwise, when we haven't enough police to keep track of them all if they're out loose. But we should make more use of alternatives when we can, and it does no one any good to have Kenneth Lay and Jeff Skilling in prison. Lois Black will still be missing 75% of her pension.
If they are found guilty, then to the extent that their criminal actions deprived people of retirement benefits, they should be required to replace that retirement money. Their current assets, their future incomes, and their own retirement incomes should go toward this. It may not replace the entire 75% that Ms Black has lost, nor all of what everyone else has lost. But it will compensate those former employees, who have had to struggle to make it back from the company's collapse.