At year end 2007 the United States had less than 5% of the world's population and 23.4% of the world's prison and jail population. It also has around 70% of the world's lawyers as well so some might say therein lies part, if not all, of the reason for the huge prison population.
Tom, it is much worse than even statistics show. The right wing 'free marketeers' if given the baton will turn incarceration in America into a 'for profit' enterprise. And theses 'free marketeers' are totally obtuse to the gross conflict of interest. BTW, this article goes back to 2000 so it has gotten worse, not better...
The movement towards the
privatization of corrections in the United States is a result of the convergence of two factors: the unprecedented growth of the US prison population since 1970 and the emergence out of the Reagan era of a political environment favorable to free-market solutions. Since the first private prison facility was opened in 1984, the industry has grown rapidly; gross revenues exceeded $1 billion in 1997.
US: America's Private Gulag
June 1st, 2000
What is the most profitable industry in America? Weapons, oil and computer technology all offer high rates of return, but there is probably no sector of the economy so abloom with money as the privately run prison industry.
Consider the growth of the Corrections Corporation of America, the industry leader whose stock price has climbed from $8 a share in 1992 to about $30 today and whose revenue rose by 81 per cent in 1995 alone. Investors in Wackenhut Corrections Corp. have enjoyed an average return of 18 per cent during the past five years and the company is rated by Forbes as one of the top 200 small businesses in the country. At Esmor, another big private prison contractor, revenues have soared from $4.6 million in 1990 to more than $25 million in 1995.
Ten years ago there were just five privately-run prisons in the country, housing a population of 2,000. Today nearly a score of private firms run more than 100 prisons with about 62,000 beds. That's still less than five per cent of the total market but the industry is expanding fast, with the number of private prison beds expected to grow to 360,000 during the next decade.
During the past decade, private prisons have made a comeback. Already 28 states have passed legislation making it legal for private contractors to run correctional facilities and many more states are expected to follow suit.
The reasons for the rapid expansion include the 1990's free-market ideological fervor, large budget deficits for the federal and state governments and the discovery and creation of vast new reserves of "raw materials" -- prisoners. The rate for most serious crimes has been dropping or stagnant for the past 15 years, but during the same period severe repeat offender provisions and a racist "get-tough" policy on drugs have helped push the US prison population up from 300,000 to around 1.5 million during the same period.
Greasing the Wheels of Power to Keep Jails Full
To be profitable, private prison firms must ensure that prisons are not only built but also filled. Industry experts say a 90-95 per cent capacity rate is needed to guarantee the hefty rates of return needed to lure investors. Prudential Securities issued a wildly bullish report on CCA a few years ago but cautioned, "It takes time to bring inmate population levels up to where they cover costs. Low occupancy is a drag on profits." Still, said the report, company earnings would be strong if CCA succeeded in ramp(ing) up population levels in its new facilities at an acceptable rate".
"(There is a) basic philosophical problem when you begin turning over administration of prisons to people who have an interest in keeping people locked up" notes Jenni Gainsborough of the ACLU's National Prison Project.
Private prison companies have also begun to push, even if discreetly, for the type of get-tough policies needed to ensure their continued growth. All the major firms in the field have hired big-time lobbyists. When it was seeking a contract to run a halfway house in New York City, Esmor hired a onetime aide to State Representative Edolphus Towns to lobby on its behalf. The aide succeeded in winning the contract and also the vote of his former boss, who had been an opponent of the project. In 1995, Wackenhut Chairman Tim Cole testified before the Senate Judiciary Committee to urge support for amendments to the Violent Crime Control Act -- which subsequently passed -- that authorized the expenditure of $10 billion to construct and repair state prisons.
CCA has been especially adept at expansion via political payoffs. The first prison the company managed was the Silverdale Workhouse in Hamilton County, Tennessee. After commissioner Bob Long voted to accept CCA's bid for the project, the company awarded Long's pest control firm a lucrative contract. When Long decided the time was right to quit public life, CCA hired him to lobby on its behalf. CCA has been a major financial supporter of Lamar Alexander, the former Tennessee governor and failed presidential candidate. In one of a number of sweetheart deals, Lamar's wife, Honey Alexander, made more than $130,000 on a $5,000 investment in CCA. Tennessee Governor Ned McWherter is another CCA stockholder and is quoted in the company's 1995 annual report as saying that "the federal government would be well served to privatize all of their corrections."
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