The third of the five precepts:
- Kamesu micchacara veramani sikkhapadam samadiyami
I undertake the precept to refrain from sexual misconduct.
The third of the eight precepts:
- Abrahmacariya veramani sikkhapadam samadiyami
I undertake the precept to refrain from sexual activity.
So the third precept is stricter in the "eight precept" version of the precepts, than in the "five precept" version.
These training rules [the eight precepts] are observed by laypeople during periods of intensive meditation practice and during uposatha (lunar observance) days. The Eight Precepts are based on the Five Precepts, with the third precept extended to prohibit all sexual activity and an additional three precepts that are especially supportive to meditation practice.
This answer quoted this introduction to the Five precepts, which says,
In many suttas regarding lay practice (Anguttara iii, 203), the
Buddha explicitly warned of the five vices, which are dangers and
enemies, and lead to hell. What are the five?
i) Killing living beings
ii) Taking what is not given
iii) Sexual misconduct
iv) Telling lies
v) Partaking of intoxicants
- One who has these five vices lives the home-life without selfconfidence.
- One who has these five vices breeds hatred in this life or breeds
hatred in the life hereafter, feels in his mind pain and grief.
- One who has these five vices is termed 'vicious' and arises in
hell.
In the same suttas, the Buddha spoke of the advantages of
cultivation of the five virtues, which are the Five Precepts, namely:
i) Abstention from killing living beings
ii) Abstention from taking what is not given
iii) Abstention from sexual misconduct
iv) Abstention from telling lies
v) Abstention from partaking of intoxicants
- One who has these five virtues lives the home-life with
complete self-confidence.
- One who has these five virtues breeds no hatred in this life, or
in the life hereafter, nor does he feel pain and grief.
- One who has these five virtues is called virtuous and arises in
the happy plane of existence.
I don't read that as being permissive. I read that as "this is the minimum standard of good behaviour needed to avoid being offensive towards other people -- to avoid harming other people."
The Five Precepts form the actual practice of morality for the
layman. They are the minimum ethical code, which are mandatory
for all lay disciples. They are undertaken immediately after the
taking of the Three Refuges at every Buddhist service or ceremony
and are administered by a monk if one is present; otherwise the lay
disciples can do it by themselves. It is usual for devout lay disciples
to undertake the Five Precepts as part of their daily recitation.
There's a definition of "misconduct":
This precept enjoins abstinence from improper or illicit sexual
relations. The Atthasalini defines sexual misconduct as the volition
arising in the body-door, through the unlawful intention of
trespassing upon a person to whom one has no right of going.
There are four conditions for wrong conduct in sexual pleasures.
i) There must be a man or woman with whom it is improper to
have sexual intercourse.
ii) There must be intention to have sexual intercourse with such a
person.
iii) Action must be taken to have such an intercourse.
iv) There must be enjoyment from contact of the sexual organs.
With reference to the first condition, there are twenty kinds of
women with whom men should have no sexual relations. They can
be divided into three groups, namely: women under the
guardianship of parents, family members, relatives and authorities
charged with their care; married or betrothed women; bhikkhunis
and religious women observing the Holy Life. For all women, a
man forbidden by tradition or under religious rules is prohibited
as a partner. For any unwilling partner who is drugged or forced to
have sexual intercourse under threat of violence or coercion,
conditions (ii) & (iv) exclude them from violation of the precept.
And it's not "to attain stream entry".
And I don't read it as permissive (e.g. "prostitution is encouraged"), instead I read it as protective, i.e., "don't do things which could break up families -- e.g. sexual activity with people who are married, and/or with the children who are under their protection -- nor which could interfere with someone who is leading the holy life."
It seems to me that according to one interpretation of the "3rd precept" of the 5 precepts one could even engage in various sexual acts with a vast number of prostitutes nonstop and that still wouldn't be considered as breaking the "3rd precept". (I am doubtful of it being possible to attain stream-entry with that indulgent behavior therefore I believe the Buddha did not teach that as being a way to attain stream-entry.)
So ... "sex with prostitutes is a way to attain stream entry" -- that doesn't sound like doctrine from the suttas, does it -- is someone saying that?
I think that the canon says that some lay people entered the stream. And I think that many lay people can and do keep the 3rd precept -- by being married or unmarried -- keeping the 3rd precept isn't bad -- and the precept doesn't require anyone to "engage in etc. with a etc.".
I don't much like to criticise other people's sex lives -- "You're too permissive! You naughty people! You shouldn't have any sexual activity, with your boyfriend/girlfriend -- even if you are both adults!" Instead I'm like, if a couple is happily married and of good behaviour then mudita and good luck to them -- but criticising people isn't something ... is that a good way to spend time?
Incidentally I'm not sure that prostitution is right livelihood. Doesn't the canon define 5 types of wrong livelihood for lay people -- i.e. trade in weapons, in poisons, in meat, in alcohol ... and, in human beings?
Also would you describe the first precept as "too permissive" -- would you ask, "Why is the first precept interpreted as 'no killing'? I don't believe the Buddha taught that torturing people without killing them is a way to stream entry'."
I don't think the precepts are "too permissive" -- I think they're as a good start. They're also kind of practical -- and common-sense, which everyone (even lay societies to which Buddhism is a new doctrine) might agree with.