Less government regulation doesn’t mean violating contract law.

What contract did piratebay creators violate? They never signed any contract, and neither did anyone downloading.

Presumably the ripper has some form of contract with whichever entity they sourced the content from, and piracy undoubtedly violates that contract / ToS.

None of that could result in piratebay staff going to jail, or individual people downloading recieving legal threats

Could or should? If you want to download a bunch of mp3s without paying the author, knowing that the author has not intended for you to do so, do you think that is right?

Yes it is, because copyright law (like all laws) is government regulation.