It’s a Cell Block Life: Prison for Profit May Mean More Time Behind Bars


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Does going to a private prison reduce or increase risk of going back to jail? Image courtesy of the Arizona Department of Corrections.

It is no secret that America, “Land of the Free, home of the Brave,” has the world’s highest incarceration rate.

Why are there so many people in private prisons – and how do these corporate-owned prisons affect the recidivism rates?

Who is in Prison?

Ten years ago there were only five private prisons in the country, with a population of 2,000 inmates. Now there are 100 private prisons with a population of 62,000 inmates. Experts expect the industry to grow more in the coming decade – forecasting 360,000 inmates in private prison complexes.

Bureau of Justice statistics showed that there were 6,977,700 offenders at the end of 2011,  with  1 in 107 adults being incarcerated.

The Population Reference Bureau breaks it down to a rate of 500 prisoners per 100,000 resident or about 1.6 million in 2010.

Men make up 90 percent of the prison population – their rate of incarceration is 14 times higher than the rate of women.

Prison Populations By Ethnicity

The incarceration rate is significantly higher for Blacks and Latinos than Whites.

In 2010 Black men were incarcerated at a rate of 3,074 per 100,000 per resident, Latinos were incarcerated at a rate of 1,258 per 100,000 and White men at 459 per 100,000.

The Southern states have had historically high rates with Louisiana being the highest of the nation with 867 per 100,000 residents.

Cash Cow Overload

With so many people going to jail, the need for private prisons is a focal point for government. State prison overcrowding and the high costs of maintaining a jail mean that private prisons are a way to ease some burden on tax payers. Sounds innocent enough, but Private Prisons (now termed Prison Industry Complexes), are one of the fastest growing industries in America.

This group has lobbyists as well as investors on Wall Street.  According to Global Research, “It is a multimillion industry with its own trade exhibitions, conventions, websites and mail-order internet catalogs.  It also has direct advertising campaigns, architecture companies, construction companies, investment houses on Wall Street, plumbing supply companies, food supply companies, armed security, and padded cells in a large variety of colors.”

Longer Prison Sentences: Cheap Labor, Easy Income for Corporations

Global Research also pointed out that one reason that there were so many prisoners in the system was the private contracting of  prisoners for work. Low-cost labor, with financial incentives for filled beds, gives prisons an incentive to keep people locked up.

Private prisons receive a guaranteed amount of money for each prisoner, independent of what it costs to maintain each individual. The two largest prison corporations are the Correctional Corporation of America (CCA) and the GEO Group, Inc. who make billions of dollars in profit annually.

According to CNBC, there are more than 2.3 million people locked up. One out of 100 American is behind bars and the private companies make a reported 74$billion dollars a year.

Contracts between the state and private prisons guarantee 80-100% occupancy.  According to Julie Bowling of the Brennan Center for justice, if the state is unable to supply enough prisoners to keep 80 to 100% of the private prison beds filled for this bed guarantee then the state has to pay a fine for the empty bed.

In an annual report filed by the Securities and Exchange Commission, the second largest private prison company, The GEO Group, Inc., stated “ The demand for our facilities and services could be adversely affected by the relaxation of criminal enforcement efforts, leniency in conviction and sentencing practices, or through the decriminalization of certain activities that are currently proscribed by criminal laws. For instance, any changes with respect to the decriminalization of drugs and controlled substances or a loosening of immigration laws could affect the number of persons arrested, convicted, sentenced and incarcerated, thereby potentially reducing demand for correctional facilities to house them.” 

Prison for Profit: Recidivism

In theory, private prisons not only ease overcrowding and provide better conditions for the prisoners, but have rehabilitation structures in place and reentry programs to reduce the stubborn recidivism rate.

The  CCA has said that they are committed to providing inmates with recidivism-reducing programs which, based on evidence and  statistics, have proven to be successful in reentry and reduced recidivism.

Florida State University (FSU) and the Florida Department of Corrections (FDOC) conducted a study, building on various previous studies, based on four recidivism measures: subsequent arrest, felony convictions, imprisonment for new offense and technical violation.

When FSU completed the study, based on the studies done at the Florida institutions, they concluded that there was some relationship between private prisons and lower recidivism rates when the inmates were enrolled in academic vocational and substance abuse programming – which could affect the outcome of the studies.  There has been no empirical data to date that private prisons reduce recidivism.

Social Impact Bond… Could It Work?

The Social Impact Bond created by Goldman Sachs and Rikers Island in New York, serves as a good example for the states if they choose to follow. A report by Timothy Rudd, et al described Financing Promising Evidence-Based Programs – in particular, one program in which Goldman invested in the Riker’s Island reentry program. The amount of money that NYC would pay to Goldman Sachs depended on whether the program met certain goals in decreasing their recidivism rate. This program is a success.

Private Prisons and Tax Payers

Ari Melber of MSNBC reported that between 2003 to 2010, the Corrections Corporation of America spent $14 million dollars on lobbying in 30 states. The top three private prison companies have spent over $45 million dollars on campaign donations and lobbying in the past decade.

According to Tracy Valesquez , executive director of  the Justice Policy Institute, “there needs to be a hard look at cost of the influence of the private prisons to the tax payers and communities as a whole in terms of the people being lobbied for  and the outcomes to put people in prison.  The lobbying and political contributions are funded by tax payers.” 

Lobbying for private prisons – is that where you want your tax dollars spent?

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