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(P. Hawker)
Nashville-based Corrections Corporation of America has a plan to expand its growing empire of private prisons it owns or manages. It wants buy existing prisons. The pitch is that this will help states with their revenue problems by providing a one-time lump-sum payment in exchange for a 20-year management contract and assurance that the prison will stay at 90 percent capacity during that time. A sweetheart deal.

The new approach of this so-called "corrections investment initiative" proposal is outlined in a letter to officials in 48 states from CCA's Executive Vice President General Counsel Harley G. Lappin. The letter was obtained by reporter Chris Kirkham.

CCA would only make deals in cases where there is a minimum rated occupancy of 1,000 beds, the facility is no more than 25 years old and ready for immediate occupation or already occupied by inmates and there is assurance that the inmate population "maintain a minimum 90 percent occupancy rate over the term of the contract."

At a time when states are still suffering from the impact of the Great Recession, that may sound like a good deal. It certainly sounds like a good deal Republican governors who already are on the privatize everything kick that the American Legislative Exchange Council has promoted. In fact, CCA is closely tied to ALEC. An ALEC-originated "truth in sentencing" bill that makes it tougher for prisoners to gain parole, was drafted by a committee that included members from CCA. By the end of the 1990s, such sentencing measures had passed in 40 states. When your bottom line comes from keeping people in the slam, you'll do what you can to keep people in the slam.

According to Gaming the System: How the Political Strategies of Private Prison Companies Promote Ineffective Incarceration Policies, private prisons have already done a good job of increasing their "market share" of the overall prison population. While the number of inmates over the past decade has risen 16 percent, the number in private federal facilities has risen 120 percent and the number in state facilities has risen 33 percent. Meanwhile, the two largest private prison operators, CCA and GEO Group (formerly Wackenhut), took in a combined $2.9 billion in revenue in 2010.

Besides supposedly taking this messy business of the hands of states that incarcerate far too many offenders—many of whom should be redirected toward alternatives other than slam time in those cases when they should be punished at all—the prison industry, with CCA the biggest dog on the block, promotes the idea that it is more efficient. Being private and all, y'know.

But the key claim that private is cheaper is bogus. Studies by the Government Accountability Office, the National Institute of Justice and the University of Utah have found no cost savings. Often, this is because the private companies fail to mention hidden costs of their operations and low-ball estimates of expected overhead when bidding on a new prison. The one place they regularly beat the public sector is the speed with which they typically build a prison. And, in the case of buying them, that obviously is not part of the equation.

Prison privatization risks higher costs for Ohio, a December report from Policy Matters Ohio, takes issue with the claim that privatization would give a break to state's bottom line:

State officials have argued that selling and outsourcing the prison will generate $3 million in cost savings each year. But a report from Policy Matters Ohio calculated that selling the Lake Erie prison would actually cost more in the long term than if the state continued to own the property and pay off the construction bonds. That's because the state has to pay Corrections Corporation of America a $3.8 million annual ownership fee for housing state prisoners, in addition to the prisoner per-diem costs laid out in the contract.
According to the report, the prison sale would cost taxpayers $11 million more over the next 20 years than if the state had continued to own the prison.

For the private prison industry, it's all about increasing "market share" and increasing the size of the market, that is, the inmate population. They obtain secure government contracts, like the ones discussed in the letter, they push public policy changes that put more people into prison, and they contribute campaign money, lobby aggressively and build "connections" among politicians and political appointees who can aid their cause.

According to the Justice Institute report, CCA had 41 lobbyists in just three states—Tennessee, Nevada and Florida—from 2003 to 2010. The institute found it impossible to track all the money spent on lobbying at the state level by these companies as a consequence of widely differing disclosure laws.

The "revolving door" also benefits the private prison industry, with many former government officials joining prison companies the same way ex-colonels and ex-generals join the weapons industry upon retirement, and for the same reason: influence among their former colleagues.

It's a story we're all too familiar with. At a time when we ought to be figuring out ways to get hundreds of thousands of non-violent offenders out of prisons and reforming the way we handle those who need to be locked up, this privatization scam is what's on the table. If the past is any guide, we can count on many states eagerly going along with it.

Originally posted to Meteor Blades on Tue Feb 14, 2012 at 10:14 AM PST.

Also republished by The Rebel Alliance, American Legislative Transparency Project, ClassWarfare Newsletter: WallStreet VS Working Class Global Occupy movement, and Daily Kos.

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