• Advertisement

The Private Prison Industry Makes How Much By Keeping People In Prison? (INFOGRAPHIC)

Screen shot 2014-04-14 at 1.52.23 PM

The private prison system is making massive profits by keeping people incarcerated.

The US has the largest number of people incarcerated per 100,000 than any other country in the world.

On top of all of that, CCA and other private prison companies are using inmates as cheap labor. They pay prisoners $.50 cents per day, while CCA is being paid $55 dollars a day to keep them incarcerated.

The_Private_Prison_System_in_USA
Privatization of the US Prison System. An Infographic from ArrestRecords.com

The reference links below:

http://en.wikipedia.org/wiki/Private_prison

http://www.theinternational.org/articles/422-profits-over-justice-the-21st-century-pr

http://www.privateci.org/private_pics/Private%20prison%20fact%20sheet%202009.pdf

http://www.pbs.org/now/shows/419/index.html

http://www.inthepublicinterest.org/blog/%E2%80%9Clockup-quotas%E2%80%9D-guarantee-profits-us-private-prison-industry

http://www.activistpost.com/2013/12/the-us-prison-population-by-numbers.html

http://truth-out.org/news/item/20880-for-profit-prisons-eight-statistics-that-show-the-problems

https://www.aclu.org/prisoners-rights/banking-bondage-private-prisons-and-mass-incarceration

http://www.motherjones.com/mojo/2013/09/private-prisons-occupancy-quota-cca-crime

http://www.globalresearch.ca/the-prison-industry-in-the-united-states-big-business-or-a-new-form-of-slavery/8289

http://www.huffingtonpost.com/2013/08/13/incarceration-rate-per-capita_n_3745291.html

http://prisonvalley.arte.tv/en/forums/discussion/41/private-prisons-facts-data-and-future-prospects/

http://www.bjs.gov/content/pub/pdf/cpus12.pdf

Private Prisons: Your Tax Dollars Hard At Work Lining The Corporation’s Pockets

Prison bars lockup hands

Prison bars lockup handsFor many years our state and local governments have been looking for ways to save money in their budgets. Some have turned to privatization as a way to reduce cost.  Privatization ultimately ends up costing taxpayers more money in the long run no matter how much they save up front.  The private prison industry is no different.

Private prisons have been popping up all across the country. They offer to build a new prison and then lease it back to the state.  Also part of this agreement is that the state will pay the private prison company to operate the prison.

The initial savings come from the fact that the private prison company coughs up some of the money to cover the cost of constructing a new building.  Many state’s budgets are so thin that they cannot afford to do major investments like building a new prison.  This may save the taxpayers money in the actual construction, but the private prison industry makes their money back and more on the occupancy of the prison.

In a new report released yesterday, Criminal: How Lockup Quotas and “Low-Crime Taxes” Guarantee Profits for Private Prison Corporations,” we see exactly how private prisons are actually taking extra money from the taxpayers.

The study documents the shocking prevalence of contract language between private prison companies and state and local governments that either guarantees prison occupancy rates (“lockup quotas”) or forces taxpayers to pay for empty beds if the prison population falls due to lower crime rates or other factors (“low-crime taxes”).

That’s right, you are paying a corporation for empty beds in private prisons.

Nationally we all have been working to reduce the number of prisoners in our penal system.  Reducing the number of inmates would also help reduce our state budgets, right? Wrong.  With ‘Lockup Quotas’ it does not matter how many people are in the prison, the corporation still gets a minimum fee.

In The Public Interest, who released the above report, found “nearly two-thirds (65 percent) include occupancy guarantees and force taxpayers to pay for empty prison beds if the lockup quota is not met.”

ITPI research also found that “lockup quotas in private prison contracts range between 80 percent and 100 percent; 90 percent is the most frequent occupancy guarantee requirement. Arizona, Louisiana, Oklahoma and Virginia have the highest occupancy guarantee requirements, with quotas requiring between 95 percent and 100 percent occupancy.”

Image from ITPI Report

Image from ITPI Report

Donald Cohen, Executive Director of ITPI stated: “Private prison companies are gaming the system to guarantee themselves profits at the expense of taxpayers and, worst of all, at the expense of people’s freedom.  Governments should cease working with this corrupt industry and reclaim public control of corrections.”

Alex Friedmann, Managing Editor of Prison Legal News, a project of the Human Rights Defense Center stated: “As a private prison expert who began researching the industry while incarcerated in a for-profit prison, I can tell you firsthand that private prison companies are profitable only because they are ethically bankrupt, with taxpayers footing the bill.”

You can read ITPU full report here.

The story does about the private prison industry does not stop there.  One of the largest private prison corporations, Corrections Corporation of America (CCA), uses inmates as slave labor.   Forcing inmates to work for as low as $.50 an hour.

Arizona inmates working for private agricultural companies are paid a “whopping fee” of “more than 50 cents an hour.”  Read “How US prison labour pads corporate profits at taxpayers’ expense” in The Guardian here.

Liz Iacobucci talked about these atrocities before in the NH Labor News post, “Another thing that went wrong in the Bush Economy.”  That post describes how inmates in Arizona are forced to work for $2.00 an hour while CCA takes 30% to offset their incarceration costs and the state takes another 30% for legal costs.  That means inmates are being forced to work for about $.80 cents and hour.   Do you think that CCA gives that 30% back to the state to reduce the taxpayer cost of incarceration?

What do you do with an entire prison full of slave labor; you sell it to the highest bidder.  During the G.W. Bush administration the Department of Justice teamed up with the National Corrections Industry Association to promote this idea.  They even produced a recruitment video (circa 2004) to draw manufactures to set up shop in the prisons.

Industry spokesmen describe the program as a “win-win” – but that’s from their perspective.

“I asked an NCIA spokesperson how private companies can get away with what could reasonably be described as forced labor. He explained that the PIE program classifies certain work functions as a ‘service’ rather than an actual ‘job’, and therefore is not subject to [restrictions in a 1979 federal law]. Conveniently, then, the backbreaking work of picking crops in the blistering sun counts as a ‘service’, so prisoners can be paid even less than the immigrants who have traditionally performed this work.”

It is no wonder that CCA spent over “$12 million dollars between 2002 and 2012 lobbying for policies that protect their bottom line and keep pro-privatization politicians in office”.  The AP reports, “the industry’s giants — Corrections Corporation of America (CCA), The GEO Group, and Management and Training Corp. — have spent at least $45 million combined on campaign donations and lobbyists at the state and federal level in the last decade.”

The private prison industry is very lucrative for those at the top.  CCA brought in $178 million in 2012 and GEO brought in $78 million.  Over 40% of CCA’s total revenue comes from federal contracts. That is your tax dollars lining the pockets of these companies.

It is obvious to see that the private prison industry is a loss for taxpayers.  We are overpaying for services with ‘lockup quotas’, while they collect massive profits from slave labor camps inside the prisons.

As fiscally responsible taxpayers why would we continue to let our tax dollars fuel this corporate machine?

(Related article from AATTP “Watch The Video For-Profit Prison Corporations Don’t Want You To See!“)

 

If Private Prisons Have No Chance In NH Right Now, Why Is CCA Lobbying In NH (Arnie Alpert and InZane Times)

CCA Logo

FORM 10-K IS A TREASURE TROVE OF INFORMATION

Maggie Hassan made it pretty clear during her successful campaign for governor that she has no interest in turning over control of New Hampshire’s prisons to for-profit corporations.  The majority of Executive Councilors elected in November feel the same.  While the State is still formally reviewing proposals from four private companies to build and operate its prisons, the chance that a contract for prison operation would be drawn up in the next two years is about as close to zero as it can get.  So why at least two of the companies (CCA and MTC) bothered to invest in lobbying services to defeat HB 443a bill which would ban private prisons in New Hampshire?

For insight into this and other questions, the companies’ Form 10-Ks, filed annually with the Securities and Exchange Commission (SEC), are worth a read.

According to the SEC, “the 10-K offers a detailed picture of a company’s business, the risks it faces, and the operating and financial results for the fiscal year. Company management also discusses its perspective on the business results and what is driving them.”

Unlike the glossy Annual Reports for stockholders, Form 10-K comes without photos and with a more straightforward writing style.  The SEC says, “Laws and regulations prohibit companies from making materially false or misleading statements in their 10-Ks. Likewise, companies are prohibited from omitting material information that is needed to make the disclosure not misleading.”  In other words, they have to tell the truth, including reporting on what the SEC calls “risk factors.”

Efforts to ban private prisons, even in states that don’t have them and aren’t about to get them, are a risk to the business model of private prison companies.

Corrections Corporation of America

The Form 10-K for the Corrections Corporation of America says, “We are the nation’s largest owner of privatized correctional and detention facilities and oneCCA logoof the largest prison operators in the United States behind only the federal government and three states,” but acknowledges,  “As the owner and operator of correctional and detention facilities, we are subject to certain risks and uncertainties associated with, among other things, the corrections and detention industry and pending or threatened litigation in which we are involved.”

Among the risks they face:  “The operation of correctional and detention facilities by private entities has not achieved complete acceptance by either governments or the public.” 

How’s that for understatement? 

In fact, CCA states, “the movement toward privatization of correctional and detention facilities has also encountered resistance from certain groups, such as labor unions and others that believe that correctional and detention facilities should only be operated by governmental agencies.”  

The GEO Group

The GEO Group, the industry’s #2, agrees.  In its Form 10-K, GEO says, “Public resistance to privatization of correctional, detention, mental health and residential GEO Group logofacilities could result in our inability to obtain new contracts or the loss of existing contracts, which could have a material adverse effect on our business, financial condition and results of operations.”

“The movement toward privatization of such facilities has encountered resistance from groups, such as labor unions, that believe that correctional, detention, mental health and residential facilities should only be operated by governmental agencies… Increased public resistance to the privatization of correctional, detention, mental health and residential facilities in any of the markets in which we operate, as a result of these or other factors, could have a material adverse effect on our business, financial condition and results of operations,” GEO adds.  

Immigration reform laws are currently a focus for legislators”

CCA gets pretty specific about the “factors we cannot control” which consitute risks to their business:

“The demand for our facilities and services could be adversely affected by the relaxation of enforcement efforts, leniency in conviction or parole standards and sentencing practices or through the decriminalization of certain activities that are currently proscribed by criminal laws. For instance, any changes with respect to drugs and controlled substances or illegal immigration could affect the number of persons arrested, convicted, and sentenced, thereby potentially reducing demand for correctional facilities to house them. Immigration reform laws are currently a focus for legislators and politicians at the federal, state, and local level. Legislation has also been proposed in numerous jurisdictions that could lower minimum sentences for some non-violent crimes and make more inmates eligible for early release based on good behavior. Also, sentencing alternatives under consideration could put some offenders on probation with electronic monitoring who would otherwise be incarcerated. Similarly, reductions in crime rates or resources dedicated to prevent and enforce crime could lead to reductions in arrests, convictions and sentences requiring incarceration at correctional facilities.”

This interest in a continued and growing supply of prisoners explains the industry’s interest in immigration reform.  CNN reports, “Big tech firms and private prisons represent two industries vigorously lobbying to influence the scope of legislation aimed at overhauling U.S. immigration policy, a political priority in Washington.”

While CCA’s 10-K sates, “Our policy prohibits us from engaging in lobbying or advocacy efforts that would influence enforcement efforts, parole standards, criminal laws, and sentencing policies,” CNN notes “Corrections Corporation of America, which builds detention facilities to house illegal immigrants, [has] contributed heavily to the campaigns of lawmakers who take tough stances on the issue.”

CNN also reports, “Sen. John McCain has changed his views on immigration over the years. For instance, the Arizona Republican first supported and later opposed a path to citizenship for illegal immigrants.  He is also the fourth-highest recipient of campaign donations from Corrections Corporation of America.”  Maybe it’s just a coincidence.  Maybe not.

If corporate persons can be said to have a corporate conscience and a corporate mind, we can say that private prison companies are morally flawed.  But we shouldn’t discredit their brains.  They know how their bread is buttered, and they are acutely aware that we can cut off the butter by changing immigration laws, reducing sentences, and de-criminalizing offenses like possession of marijuana.  We can take away the whole loaf by banning private prisons, as HB 443 proposes to do in New Hampshire. 

HB 443 states that incarceration is an “inherently governmental” function and cannot be outsourced to for-profit companies like CCA, GEO, and the Management & Training Corporation (MTC).  An amendment approved by the House Criminal Justice and Public Safety Committee would allow the Commissioner of Corrections to transfer prisoners to privately operated prisons on a temporary basis in the event of an emergency, such as a fire.  With that amendment and a bi-partisan 13 to 5 “ought to pass as amended” recommendation from the committee, the bill is heading for a vote by the full House this week.  Illinois and New York already have similar laws on their books.  Since passage of HB 443 would have an “adverse effect” on their business model, we can expect the private prison companies to step up lobbying efforts in the Senate if the measure clears the House.

GEO makes another interesting point in its 10-K (page 31 if you want to look it up):  “State budgetary constraints may have a material adverse impact on us,” they say.  This is a curious observation given the fact that the private prison companies insist they save money for taxpayers.  Yet, GEO says, “budgetary constraints in states that are not our current customers could prevent those states from outsourcing correctional, detention or community based service opportunities that we otherwise could have pursued.”  In other words, GEO appears to acknowledge that private prisons aren’t less expensive after all. 

There’s plenty of other data in these reports.  There are lists of their prison facilities.  CCA reports that only 785 of its 17,000 employees are unionized, while GEO says 21% of its workforce is covered by collective bargaining agreements.   Both companies see union organizing as a risk.  Both companies provide extensive details about their creation of Real Estate Investment Trusts.  Enjoy your reading, with awareness that if you are working for immigration reform, reduced incarceration, and the shut-down of the private prison industry, someone in GEO’s and CCA’s corporate offices sees you as an element of their risk profile.

If anyone has the Form 10-K for the Management & Training Corporation, please pass it along. 

Posted at InZane Times.

Another thing that went wrong in the Bush Economy

AZ Correctional Industries

Watch this employer-recruitment video produced back in 2004 by the National Corrections Industry Association in partnership with the US Department of Justice:

Yep, if you’re a business, that’s certainly one way to “control labor costs”.  You don’t have to pay health benefits; you don’t have to pay overtime; you don’t even have to pay minimum wage.

If you’ve been watching the American Legislative Exchange Council (ALEC) closely, this probably isn’t a big surprise.  ALEC has been pushing “prison industry enhancement” (PIE) laws at the state level for about 20 years.   Read “The Hidden History of ALEC and Prison Labor” in The Nation here.

Industry spokesmen describe the program as a “win-win” – but that’s from their perspective.

“I asked an NCIA spokesperson how private companies can get away with what could reasonably be described as forced labor. He explained that the PIE program classifies certain work functions as a ‘service’ rather than an actual ‘job’, and therefore is not subject to [restrictions in a 1979 federal law]. Conveniently, then, the backbreaking work of picking crops in the blistering sun counts as a ‘service’, so prisoners can be paid even less than the immigrants who have traditionally performed this work.”

(Yes, of course there’s a Wal-Mart connection.  Read about it in the British newspaper The Guardian, here.)

Here’s how the prison labor system works in Arizona: 

  • State law requires all able-bodied prisoners to work.
  • “Arizona statute requires that all inmates that are making $2 per hour will have deductions of 30% to offset the cost of their incarceration. In addition, thirty percent of the prisoner’s wages will be deducted for court ordered restitution.”  (Are you doing the math here?  Sounds like the inmates actually receive 80 cents an hour for their work.)
  • Nevermind the recession, the prison labor business is growing.  The number of inmate hours worked during FY12 was up 8.5% over FY11.  Room and board “contributions” were up by 9.8%.  Sales were up.  Profits were up.  Arizona Correctional Industries added new products and new customers, and “are currently working on finalizing contracts that will help grow our telemarketing and service business.”  (ACI helpfully explainsHow we do it: We provide a positive learning experience for all of our workers.  We balance our home and business life.  We continually strive to improve our quality focusing on Lean Continuous improvement.  We are passionately involved in making the customer happy.”)
  • Arizona is now leading the nation in efforts to crack down on those same immigrants who used to pick crops.  Read National Public Radio’s “Prison Economics Help Drive Arizona Immigration Law” here.

Think about that employer-recruitment video that was funded by the Bush Administration in 2004:

“I have a workforce that doesn’t have car problems, or baby sitter problems et cetera.  They’re always here, and they’re always willing to come to work.”

“The situation here allows us to be able to control costs far more than we could in the past.”

“Partnerships between correctional industries and private business are a rapidly growing segment of a multi-billion dollar industry in America.”

“Bring us your business challenge.  Chances are, there’s a nearby correctional facility that can supply dependable labor, enhance your competitiveness, and increase your profitability.”

Now, think about the growth in the non-violent inmate population.

  • As of 2008, non-violent offenders made up over 60 percent of the prison and jail population.
  • If incarceration rates had tracked violent crime rates, the incarceration rate would have fallen to less than one third of the actual 2008 level.

Don’t you think something went terribly, terribly wrong?


Related Article

New Hampshire is considering privatizing the NH correctional facilities. We cannot let that happen. 

  • Advertisement

  • Advertisement