The casual phrase "federal pen" refers to prisons that in the past were called "penitentiaries".
The reality is, such institutions could not be relied upon to render residents, inmates "penitent",
feeling or expressing remorse for one's misdeeds or sins; contrite.
The debate / dispute has not been resolved, but paying a fine both derives revenue for the recipient government/s *, and penalizes the violator, ostensibly for fundamental Skinnerian conditioning, "negative reinforcement".
Negative reinforcement can be effective, for example the young child that out of curiosity and ignorance pokes his finger into a candle flame, learning to not do so again.
" Louisiana to pay $9 million " #312
The problem here is: "Government cannot give anything it has not first taken."
The result:
- the government employee, in #312 case a Louisiana State policewoman Domingue fired "without any reliable justification". The consequence, Louisiana kicks back a few $million back to the People from which it was originally taken.
States generally can't "print money" the way the U.S. federal government can. Thus, Uncle Sam can run both deficits and debt, but States ought not (spit happins).
The result:
In computer science this is known as a dysfunctional feedback loop.
The People are victimized whether by individual or group, and then the People are penalized, having their tax revenue channeled to compensate victims of government employees perpetrating criminal act/s.
This dysfunction is almost certain to continue until it is the actual criminal government employee that pays the penalty.
* in New York, when a town policeman issues a revenue deriving traffic summons, it's not uncommon for the fine revenue to be split, shared with the State of New York.