At the moment there is already legislation that can land people involved in downloading or sharing copyrighted material without a proper license. From http://www.ehow.com/info_8583389_penalties-downloading-music-movies.html However, criminal liability kick in only "if the offense involves the copying or distribution, in any 180-day period, of ten or more copies of one or more copyrighted works with a total retail value of $5,000." (link) Accordin to techdirt in the proposed "Ten Strikes" bill "the offense consists of 10 or more public performances by electronic means, during any 180-day period, of 1 or more copyrighted works". So, the intention of the bill is to remove the $5,000 value of copyrighted works as a barrier to criminal liability. Note that in the case of a youtube video an offended uploads a video including a few sings with value usually $1 - $3 each. That's the "cost" of the offense. If a million people download the video, the distribution is committed by youtube, not the original offended. So, currently a person nweds to upload hundreds of youtube videos within timespan of half a year to hit the threashold of criminal liability. The danger of the "Ten Strikes" bill is in that currently the No Electronic Theft (NET) Act of 1997 is very weakly enforced, which means that there are probably millions of youtube videos that infrige it. However, these videos stay on youtube for years because copyright holders don't complain (in fact, music appearing in a youtube video is great advertisement). Wherever there is selective enforsement, there is a great scope for abuse. I can imagine FBI agents visiting copyright holders and demanding to sign a complaint so that they can put in jail a person they are persuing on unrelated charges (but don't have enough evidence).
The entertainment industry should quit whining. They had a good business model for a while, times have changed, they have to adapt. Whining won't help. Try putting all those youtube users in jail. Not going to happen.