When Profit Meets Prison: Prison Reliant Industries and the “Demand” for Crime

by Sarah Sibley

Convicts from Folsom Prison were used to build Highway 1 along the California coast between Pfeiffer, Big Sur, and San Simeon to the south. The camps were fenced in and under guard. Floyd Risvold, United States Coast & Geodetic Survey.

Prisons, from a philosophical point of view, should be self-defeating enterprises. That is, if prisons are meant to deter crime and reform criminals, a perfectly performing prison will run out of prisoners to reform. While that may sound like something out of a science fiction novel, the Netherland’s rehabilitation-focused prison system, famous for their diversion programs, made headlines after it announced plans to close five prisons due to a “crime shortage.”

On the other hand, the United State’s prison system generates more time than it prevents, and US spends $80 billion dollars at the federal, state, and local levels  on prisons and jails. With multi-million dollars contracts on the line, business sectors reliant on the prison-system will, perversely, demand crime. Just as Dutch correctional officers unions worried about prison closures, entire industries and towns may rely on prisons, and assert their political pressure accordingly.

CoreCivic (previously the Corrections Corporation of America or CCA) is the nation’s first and largest private prison conglomerate. According to ProPublica, CCA made $1.7 billion operating more than 60 facilities across the United States, and spent $17 million in lobbying in the ten years prior to 2012. Private prisons like CCA and its competitors (GEO being the largest) have an incentive to cut corners and keep prison beds filled. Private prisons are attractive to states precisely because they offer the same service at cheaper costs. Better yet, localities reap tax benefits from private prisons that they would not get from a government-run facility. In return, contracts guarantee private prison facilities a continuous and lucrative business. According to reporting from Prison Legal News, two-thirds of prison contracts include some form of “lock-up” quota, where prison programs are guaranteed a minimum of beds that must be filled. In other words, when private prisons demand crime, states must supply it.

Washington County county jail. M.O. Stevens at en.wikipedia.

Ten percent of prisoners reside in private prisons, and as the  ACLU report on private prisons finds, these prisoners endure a higher level of violence, shoddier food, and worse medical care. The Obama Justice Department released a 2016 report that federal prisons run by private prisons are “more violent” and have more contraband than ones run by the Bureau of Prisons.

However, state and local prisons are not immune from the same overcrowding problems and budget constraints that plague private prisons, and can be driven by the same private sector incentives that may hinder any sense of penological duty. As the ACLU outlines in their series Private Profiteers, companies that provide services to prisons win contracts on their ability to provide service one at low-cost— and quality rarely factors into the equation. For instance, one prison phone call charges prisoners, who are significantly poorer than the regular population, $17 for 15-minute calls, when  “that same conversation might cost $2 outside of prison.” Similarly, the foremost prison health provider provides care at cost by  “denying needed medical care” to prisoners.

The Prison-Industrial complex becomes further entangled when private companies outsource their manufacturing to captive prison populations.

Since many states allow prisoners to be paid less than the minimum wage (in Colorado, prisoners are paid near $2 an hour-- far get less than minimum wage), using prison labor in the manufacturing process can become an attractive business move.  According to Vicky Pelaez, IBM, Boeing, Nordstrom’s, Revlon, Macy’s, and Target Stores have all use prison labor within the best three decades.  

The United States is not alone in facing political pressure to boost prison populations—in the Netherlands, corrections officer unions facing prison closures accused police of “not doing their jobs” and simply asked them to find more crime. Lobbyists for prison-reliant industries know that the supply of “prisoners” is not static, but can change with new laws or increased enforcement.