We have to ask, why the sudden push for criminal justice reform? Is there a new concern for those being incarcerated? Please forgive the cynicism but I think not. Maybe it's because prison business is no longer profitable.
Imagine that a group entrepreneurs got together to come up with the next “big” business idea. Imagine the conversation goes as follows:
Entrepreneur # 1: “We need to build something that’s going to last and has a constant supply of free resources. We don’t want to have to buy raw materials.”
Entrepreneur # 2: “Everyone is concerned about crime. Maybe we should do something along those lines.”
Entrepreneur # 3: “Why don’t we get into the prison business? We can build prisons, offer our services to states, and run them. We can tell them that we can operate a prison more effectively and efficiently than they ever could which will ultimately save them money.”
Entrepreneur # 1: “Brilliant idea, there will always be criminals. How will we ensure that we have a constant supply of resources?”
Entrepreneur # 3: “Why don’t we find an organization that links corporations with state legislators and officials? Why don’t we convince them that this is a great idea and that they should create model bills for other states to use also?”
Entrepreneur # 2: “We can pitch to them that they’re saving taxpayer money by privatizing the prison industry and they can use those funds to better serve their state. I’m absolutely certain they will fall for it.”
Entrepreneur # 1: “In the meantime this will increase the prison population so much that they will need to build more prisons. More prisons, more prisoners, more money, priceless.”
Entrepreneur # 3: “You know at some point they will realize they have been sold a bill of goods and that this is costing them more than they ever planned on. It’s going to kill their budgets.”
Entrepreneur # 1: “Yep, and when that time happens we’ll tell them to position it as criminal justice reform and they’ll look like the good guys. We would have made millions by then so who cares.”
Sounds farfetched? Not really. Although this is a fictional story let’s look at some facts:
Corrections Corporation of America (CCA), headquartered in Nashville, Tennessee, is the largest for-profit prison corporation in the U.S. CCA runs over 60 prisons in about 20 U.S. states plus Washington, DC. CCA has contracts with all three federal corrections agencies (Federal Bureau of Prisons, the U.S. Marshals Service and Immigration and Customs Enforcement), nearly half of all states and more than a dozen local municipalities. It is the fifth-largest corrections system in the U.S., with only the federal government and three states having larger prison systems. The company trades on the New York Stock Exchange with the symbol CXW. In 2006, revenue was $1.3 billion with profits of $105 million.
CCA has been a member of the American Legislative Exchange Council (ALEC) for over two decades and reportedly left the organization in 2011.
GEO Group is a global operator of private correctional, detention, and immigration detention facilities. Headquartered in One Park Place, Boca Raton, Florida, it operates 80,000 beds and 116 facilities in North America, Australia, South Africa and the United Kingdom. It is the second-largest for-profit prison operator in the U.S. behind Corrections Corporation of America.
Wackenhut Corrections Corporation (WCC) was formed as a division of Wackenhut Corporation in 1984, and was incorporated as a wholly-owned subsidiary in 1988. WCC began trading on the New York Stock Exchange as GEO in 1996, and in 2003 GEO's Board of Directors officially approved a name change to The GEO Group, Inc.
GEO parent Wackenhut Corporation has been a member of the American Legislative Exchange Council (ALEC).
Not so farfetched after all I guess.
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Ernest R. Heyward is the Founder and President of the Marketplace for Social Awareness and Social Responsibility Inc.