I don't know if it's possible to change or mold other people, but even if it is I don't see that as being the proper role of a government.

But revenge or "punishment"? I think that presenting the issue as if those are the only two options (rehabilitation vs punishment) is incorrect and doesn't address the role of the penal system or of governance.

I think that the proper role of government is to protect the rights of all individuals within its jurisdiction. Consequently that means that the role of the penal system is the exact same. How the penal system achieves that, with respects to dealing with those who have infringed upon the rights of others, is a wide open discussion and one that should often be revisited. I'm opposed to the death penalty, for example, because the risk of human error and the consequences thereof are way too high. And I think that as long the system employs prisons, how we treat prisoners and how we determine sentences is of the utmost importance.

But I don't think the purpose should be to either seek vengeance or to try and "rehabilitate" criminals (assuming that's even possible). I think the main focus ought to be on achieving the purpose of governance: to create an environment of peace and liberty where the rights of individuals are recognized and protected. If you demonstrate that you are a threat to the rights of others, as proven beyond the shadow of a reasonable doubt through the judicial system, then the purpose of the penal system in my opinion is to prevent you from continuing to be able to infringe upon the rights of others. Again, how it does that should be a never ending discussion and, depending on the severity of the crime, the ability to turn one's life around should be available. I certainly don't want to lock petty thieves up for life with no ability to put aside their criminal ways and become productive members of society should they so choose. I just think that the onus for making things right needs to be on the offender. That that's not what the system ought to be there for nor should it be the responsibility of the victims ("society", tax payers, as well as the direct victims etc.) to try and "impose" those very personal choices and actions on the offender.