Before considering, I need to know whether that dialog line about death penalty is satirical about the idea expressed or if it genuinely think it's a clever point.
Well, I can't speak for the developer, especially for a game they made 19 years ago. But given everything happening in the game, from parents trying to kill their children, to said children fighting some funny mouse in the sewers and visiting the prime minister of Japan... uh, yeah, I would say you shouldn't think too hard about it.
131 days ago(+1)
Yes, Kanao (the author) is being 100% serious.
In fact, everything said by any NPC represents the author's stance on whatever they are discussing.