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One of the major purposes of punishment is deterrence, or intimidating people into refraining from crime. The aim of deterrence is as clear, blunt and powerful as its message: "commit no crime, or you will suffer as this criminal suffers." There are two basic forms of deterrence identified by criminology, individual and general.
The purpose of general deterrence is to discourage people from committing crimes by setting an example of what the consequences of crime can be. A "Tow-Away Zone" sign is one of the lighter examples of general deterrence, while decimation (the ancient Roman military law practice of killing one out of every ten soldiers when a serious crime was committed and no one stepped forward to take the blame) is perhaps one of the harshest forms of general deterrence ever enacted. In general, the aim is to intimidate people into obeying laws by setting an unpleasant example of what could happen otherwise.
The law is an important factor in shaping people's behaviors, and the threat of punishment can act as a strong deterrent (although, of course, to be effective the punishment must be harsh enough to actually deter people from committing crimes). It's quite arguable that the consequences of crime are a major factor in reducing criminal activity, and that strong law-enforcement produces a far more law-abiding society than the lack thereof.
While few would really argue against taking the bite out of punishment, there are some arguments that deterrence is not nearly as effective as we'd like it to be. Individuals that are interested in upholding the law should consider earning a criminology education. First of all, high crime rates can easily be used to demonstrate that deterrence isn't so very effective. If it was, there would be hardly any new crime; but of course this is not the case. Also, it might be argued that many people, especially those that might be considered by criminologists as predisposed towards crime (people, for example, with backgrounds of poverty, alienation, violence, or mental illness) are unfamiliar with the punishments they might expect for committing this crime or that, and that a majority of criminals aren't the sort to stop and weigh the consequences of their actions anyway.
However sound or shallow these arguments may be, the argument that people are influenced far more deeply by religious beliefs and social norms than they are by the criminal law is formidable. The sheer threat of punishment is not nearly enough to ensure the smooth functioning of a law-abiding society, as countless examples of tyranny and police states illustrate. The threat of punishment may deter certain acts that people are naturally inclined towards but, arguably, it is chiefly our neighbor's expectation of us, or our God's, along with the desire for what is best for ourselves and others that allows a law-abiding society to function.
These arguments will probably not convince anyone that deterrence is undesirable. But it's helpful to keep them in mind while thinking about why society punishes criminals, and what the goals of a healthy society really are.
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General Deterrence and Punishment - Criminal Law Basics