LBN’s Bob Donley reports that there are both pros and cons to the use of private prisons (see Bob’s earlier LBN report on private prisons.) The private prison industry got started in Tennessee in 1983 and has since grown into a $5 billion a year business. About 8.5% of all inmates are housed in private prisons, about 135,000 people. As America’s prison population has grown, the population in private prisons has kept pace. But is this good news? Donley lists the pros and cons in this report.
On the plus side, companies claim that they can handle incarceration for less money and can do a better job. For example, companies can buy their supplies in large, bulk purchases and negotiate lower prices. Donley explains that governments usually have strict purchasing rules, and as a result, they pay more for supplies. Also, companies can hire employees at lower wages and can save on pension costs. Governments are more restricted as to hiring—and especially firing—state employees.
There are three big companies in the business: Corrections Corporation of America, The GEO Group, Inc., and Management & Training Corporation. Private prison proponents say that the three players provide competition for contracts, assuring better service and better care for inmates.
Critics of private prisons say that governments are charged with protecting and safely housing their inmates. Companies, goes the complaint, only care about making profit. Another concern, Donley notes is that state governments could become too dependent on private companies to do what the states would otherwise have to do for themselves. Also, states are pushed to guarantee to a company a high occupancy rate. Three states have guaranteed a 95% occupancy rate. And Arizona, Donley reports, has guaranteed occupancy rates of 100%. This means that taxpayers will be paying for a full house no matter how many inmates are actually behind bars.
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