It isn't illegal to withdraw money from the bank
Actually, withdrawing money from a bank can be illegal, if it is determined that you structured your withdrawals to avoid the reporting mandated by the government for large withdrawals (i.e. over $10K). Thank you War on Drugs for that bit.
nor to compensate someone in recognition of past harms
Compensating someone for past harms? No. Compensating someone for refusing to testify and/or cooperate with an active investigation? Yeah, that is probably illegal for both parties.
It's patently absurd to give the federal government the keys to the kingdom, but it's also patently absurd to say that criminals should get away with it because they used encryption.
Only one is patently absurd. In the US, the decision was made at the beginning when the legal/justice system was designed. It was designed on the basis that: "it is far better that 1000 criminals go free than one innocent be wrongfully imprisoned". That concept is the corner stone of our system and spirit of it. If every "difficult balance" were viewed through this lens it would be crystal clear than the intent was that "is is far better that 1000 criminals go free than violate the rights of one innocent". Unfortunately, a lot of people are short-sighted (and I'd say spineless) and cannot accept that allowing criminals to go free is also a way of protecting the innocent. They can't see that many moves ahead and/or they fear the criminal more than the government and will sacrifice their protection from one to eliminate the other, never realizing that the government they so trust is made up of many criminals (or soon-to-be criminals).
WILL NOT stand by and allow someone to be punished for speaking something that I find offensive. I don't care if it offends you, it's not your right to avoid offense.
There is another distinction that you are missing. When it comes to bullying, the speech isn't necessarily "offensive", it isn't said with the intent to "offend" the victim. It is "harmful", it is said with the intent to cause "harm" to the victim. As with most legal cases, intent is important. If it can be proven a bully engaged in speech with the intent to cause harm then that bully could be prosecuted, not for his speech, but for his intent. If it the harm can also be proven, as in this case the suicide of the victim, then the charges/sentencing can be increased. They may have only intended to harm the victim however the death of the victim was the result, they are now liable (or partially liable) for contributing to that death.
Now, in case you are talking specifically about the offensive facebook post, then you must also look at it another way. The facebook post amounts to a confession, a confession of intentionally causing harm to the victim (bullying) as well as the acknowledgement that it led to the victim's suicide/death. Furthermore, it is a confession of no remorse for the effect that was caused by the bully. Even if she has no intent for her speech to lead to an acutal suicide, when she was faced with the fact that it did, she was not remorseful of her actions. Given these facts, she should be prosecuted to the full extent of the law and given no leniency in sentencing.
Actually, Romney already did what you're suggesting. It worked well in Massachusetts.
Do you line in MA? Are signed up for the MA subsidized Commonwealth care? Do you use their facilities and doctors on a regular basis? I would assume that the answer to at least the second two are "no" if you think "it worked well". It worked well on paper. For the people who actually needed it and rely on it, and I personally know a few, well, let's just say it sucks. The facilities suck, the doctors suck, the "insurance company" sucks. Nothing is done right or on time. It's like dealing with a group of completely incompetent and overworked people, you know, just like dealing with any government bureaucracy.
He knows he needs help, and he knows it's his right (as a human) to live
It's his right to live yes but that doesn't make it someone (or everyone) else's responsibility to help him do so. It's people's fear of death that causes the dissonance you speak of, not our upbringing that socialism is bad. I know I don't have a right to everyone else's money (or the doctor's services) even if I need them to live. But if I were facing death I might be tempted to claim I did because fear will cause all sorts of irrational thoughts and ideas.
This is the fundamental problem with a "right to healthcare". You are either claiming a right to other people's money or a right to other people's time or both. This, when considered fully, is tantamount to slavery. That is why we do not have a "right to healthcare".