When Santano looks back on his old life in prison he comments that Fulsom was the "big time." He had more power there. Before the gang, if someone wanted something from him, "They just took it" because he was weak, but being in the gang stopped that because he became strong. He looks back on prison life with a certain sense of nostalgia and tells his girlfriend, "I loved it in there." The gang allows him to be competent under horrible circumstances. He has been deprived of all the ordinary, normal experiences we take for granted, such as dancing, learning to drive a car, going to the beach, standing in the moonlight with a girl, and making love. All he has ever known is violence and the need to keep others afraid of him in order to protect himself. He's more or less ruined for life on the outside by his violent conditioning.

Santano's sense of identity is tied into his membership in the gang. This becomes clear when his girlfriend talks about him as two people. His concept of himself...

For anyone, having an identity is paramount to being a human being, but especially in the de-humanizing ordeal of prison life. This is what is meant by the title of the film, American Me. Me refers to inmates who have no other identity but that of criminals and don't know how to be anyone else. They have lost touch with who they really are.
I had heard that drugs were plentiful in prison and wondered how it was possible to use them under the noses of prison officials. The movie showed how it was done and how commonplace all the criminal activities are in prison. Once a prison sentence was thought of a chance to start over and become rehabilitated through training for a job and getting an education. But the film shows clearly that rehabilitation is not even a consideration. The focus is strictly on punishment and treating the prisoners as though they had no other identity but as criminals, as though they were not human beings at all.