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February 28, 2014

"The Private Prison Racket"

The title of this post is the headline of this lengthy piece from Politico. It carries this sub-headline: "Companies that manage prisons on our behalf have abysmal records. So why do we keep giving them business?". And here is one snippet of a piece that merits a full-read by all researchers and policy-makers interested in prison reform:

As inmate populations have soared over the last 30 years, private prisons have emerged as an appealing solution to cash-starved states.  Privately run prisons are cheaper and can be set up much faster than those run by the government.  Nearly a tenth of all U.S. prisoners are housed in private prisons, as are almost two-thirds of immigrants in detention centers — and the companies that run them have cashed in.  CCA, the oldest and largest modern private prison company, took over its first facility in 1983. Now it’s a Wall Street darling with a market cap of nearly $3.8 billion.  Similarly, GEO Group, the second largest private-prison operator, last week reported $1.52 billion in revenue for 2013, its most ever and more than a hundredfold increase since the company went public ten years ago.

But while privatizing prisons may appear at first glance like yet another example of how the free market beats the public sector, one need only look at CCA’s record in Idaho — which recently cancelled its contract with CCA — to wonder whether outsourcing this particular government function is such a good idea.

In July 2000, Idaho’s then-Governor Dirk Kempthorne made a decision similar to Jerry Brown’s. He opened the Idaho Correctional Center, the state’s first private prison. But it wasn’t long before the facility — built and operated by CCA — began to draw concerns. Prisoners in the 2,000-bed facility dubbed it “Gladiator School” for the rampant fighting that took place inside.  A 2008 study by the Idaho Department of Corrections obtained by the American Civil Liberties Union showed that there were four times as many prisoner-on-prisoner assaults there than in all the state’s seven other prisons combined.

The ACLU sued CCA in 2010, alleging that violence had become an “epidemic” in the facility, and the Associated Press released a video showing a prisoner beaten unconscious while correctional officers stood around watching.  A 2011 settlement required CCA to keep more officers on staff, but the company apparently didn’t bother to do that.  Last year, a review of CCA’s staff records showed that prison employees had falsified as many as 4,800 hours over the course of seven months; they had understaffed the prison on purpose and fudged records to boost their personal incomes.  The end result: Idaho will terminate its private prison experiment with CCA in June.

CCA’s failure in Idaho is just one example of the industry’s spotty record.

Some related posts on private prisons: 

UPDATE:  Steve Owen, who is senior director of public affairs for CCA, has this response to the piece linked/quoted above now in Politico, and here are excerpts:  

A recent opinion piece in Politico Magazine about private prisons and our company, Corrections Corporation of America (CCA), was a rehash of stale arguments that failed to provide a balanced look at the important role we play in addressing the many corrections challenges our nation faces.

In reality, our company is helping federal, state and local governments find solutions to overcrowded facilities, skyrocketing taxpayer costs and inmates struggling to break the cycle of crime.  Our company believes we have an opportunity and a responsibility to help inmates develop the skills and values they need to be successful when they are released from prison.  We are a team of 16,000 correctional officers, chaplains, teachers, nurses and counselors providing high-quality corrections services at a cost savings for taxpayers.

The opinion writer opens his piece with ill-informed commentary about CCA’s relationship with California.  In fact, there is perhaps no better example of the important role we can play in addressing corrections challenges.  The difficulties the state has faced with overcrowded facilities are well documented, and for more than seven years, CCA has provided an important relief valve to help them manage their inmate population.  Our facilities and professional staff have alleviated unsafe conditions and created opportunities for offenders to access a wide range of programs that prepare them to re-enter their communities once their time is served.  The most recent iteration of our partnership is an innovative agreement that allows California to lease needed space from our company and staff the facility with public employees.

Additionally, the tools we are providing to help manage this difficult situation are being delivered at a significant cost savings. Overall, economists from Temple University, in an independent study receiving a partial grant from our industry, analyzed state government data and found companies like ours save 12 percent to 58 percent in long-term taxpayer costs....

Overall, we recognize that there’s a national discussion going on about our justice system, and people often feel passionately about what should be done to improve it.  Much of that conversation is driven by frustration with sentencing and detention laws, which under longstanding policy our company doesn’t lobby for or take positions on.  Where we can and do make a difference is in being an available tool for governments, providing them critical flexibility to meet their changing needs, while offering inmates services that can help turn their lives around.  For our company, making that difference is an opportunity, a responsibility to our communities, and at the heart of our business. 

February 28, 2014 at 11:41 AM | Permalink


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There is nothing inherently wrong about privatizing prisons, but like any other government contract, the contractor has to be held accountable. This is a good governance and oversight issue.

Posted by: MMK | Feb 28, 2014 3:28:59 PM

I believe that CCA has done well in Georgia.

Posted by: Admakis | Feb 28, 2014 4:18:34 PM

Admakis: based on what metrics? There seems to be no standard guage with which to measure other than price.

Posted by: Skeptical | Feb 28, 2014 11:29:45 PM

the former BOP DIrector Harvey Lappin went on to head the Correctional Corp. about 5 years ago, with a million-dollar package.
Is there NOTHING illegit about that sort of transfer---nothing white-collar criminal in the juggling of these two putrefied enterprises?

Posted by: BRENDA | Mar 1, 2014 12:24:48 PM

1. Reports have them running at 10%-15% below public costs with no safety or programming/rehab reduction.
2. My colleague (we are in public corrections) coordinated with 2 x LE agencies in GA just this last month (Feb.) and both believed that the CCA pens. were better
than the comparative public prisons.
3. Family of mine in Georgia say that "Coffee Correctional"? and another one, have good reputations.
4. The only drawback or complaint I have found in my brief glance at the Net is that inmates don’t like how the private prisons in GA are apparently far away
from their home. [Could that be in the countryside, ‘upstate’, far from Hotlanta, Savannah, et al?]

Posted by: Adamakis | Mar 1, 2014 12:54:53 PM

Hopefully those law enforcement agencies in Georgia don't include DHS/ICE. Those guys operate with almost impunity that wouldn't be tolerated elsewhere. The Northern District of Georgia is a great place to be a fed. My 2 experiences with that district were mind boggling. I'll be staying here in Illinois, thank you.

Regardless, you may be interested in the series posted this past week on Volokh conspiracy by Sasha Volokh. There are 5, but this was his first. It is to discuss the paper Sasha recently published:


Posted by: Skeptical | Mar 1, 2014 11:47:27 PM

admakis, with regard to the cost savings, do you know if that takes into account the kind of prisoners they accept? I have read in several places lately that such cost-savings numbers can be misleading b/c CCA and other private prisons often have terms in their contracts where they are not required to take on certain high-cost inmates (i.e., the elderly and the sick).

Posted by: anon | Mar 3, 2014 1:52:52 PM

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