This seems like a fair synopsis of the debate, well done for taking the time. You summarized my position accurately enough.

To be clear, I was making a very narrow point which should not really be controversial. Punishment, when understood as retribution, is an affront to human dignity and also just ineffective. It irritates me that so many people (the vast majority of us, let's be honest) seem stuck in this medieval mindset of "let's hurt the perpetrator".

But punishment does have other more positive aims, such as restoration (making amends to victims) or rehabilitation (of the perpetrator). Well: the evidence is pretty clear. Places with liberal (progressive) criminal-justice systems, countries like Norway with its ultra-light-touch sentencing and "holiday camp prisons", these places have far less crime than places like the USA where most people are still stuck in their conviction that things must be made miserable for the perpetrator. Ultimately, we have to decide what we want: do we want to feel good about ourselves for having got revenge on someone who did harm, or do we actually want a fairer society with less crime, including financial crime? If it's the latter, retribution is a dead end.

Back in the land of hard choices, of course wage thieves and tax evaders need to pay some kind of price for their misdeeds. Not least for the symbolic value, and for the shame (rather than suffering) that it inflicts on them. This is roughly what happened in Iceland after the financial crisis, BTW. A bunch of bankers did actually go to prison there. But the sentences were short and, IIRC, it was basically some form of house arrest. That seems to me like a decent solution.