How private prisons turned criminal justice into big business

Concept of the prison with the arrest of a criminal. The prisoner is sitting in his cell and despera...
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In the United States, incarceration is almost as common as breathing air. After all, the U.S. incarcerates more people than any other country in the world. But why is incarceration so common here? That answer is complicated and involves looking at the transformation of slavery, colonialism, classism, and other things across time. However, one undeniable factor now is that, in the U.S., incarceration is a booming business — so much so that in 2018, the Sentencing Project reported that the U.S. has the world's largest private prison population.

Private prisons are by no means behind mass incarceration as a whole. America's love of incarceration is so deeply entrenched that if you imagined every state as its own nation, Massachusetts, which has the lowest incarceration rate in the U.S., would still rank 9th among the world. But as long as someone can make money off locking others up, there will always be motivation to keep those cages around and even build more, whether digital or physical. Let's be clear, too — there's a lot of money in private prisons. In 2017, the Prison Policy Initiative reported that the government pays private companies about $4 billion per year to operate prisons.

Reading this, you may be left with some questions. Like, what makes a prison private? When did the first private prison open? And who are some of the biggest players in the industry? Let's break down it down.

What makes a private prison "private"?

There are two types of prisons in the U.S.: public and private.

You can trace the roots of private prisons back to the 18th century. The model that we know today, though, hasn't been around long at all. In The Conversation, Brett Burkhardt, an assistant professor of sociology at Oregon State University, wrote that modern private prisons have existed since the 1980s.

Protesters outside the Florida headquarters of the private prison company Geo in 2019. [Joe Raedle/Getty Images]

In practical terms, there isn't much separating private prisons from public ones. They both incarcerate people. And like their public counterparts, private prisons can operate at the local, state, or federal level. The difference between them is just that one is the responsibility of the government, while the other is contracted out to private companies who are paid by the government to keep the facilities operating.

Private companies can win contracts after the government opens a project to bids. When the government sees a bid it likes, it can contract with that company, and the amount paid is often dependent upon how many people are incarcerated in that facility. The contract rate may also be based off the average length of time being served in that facility.

Once the contract is signed, the private company takes over responsibility for managing the facility. It has to hire staff, keep the facility stocked with supplies, provide programming for inmates, and everything else. Private companies also assume all legal liability for the facilities they manage. So let's say an incarcerated person is abused in a private prison in Minnesota; if that person sues, they're suing the company that runs that prison, not the state that they were incarcerated in.

You may think that a bunch of companies are scrambling to get these contracts. In theory, that's how it would work. But in reality, just two companies dominate the market: Geo and Corrections Corp. of America, now known as CoreCivic. Together, these two firms claim to control about three-quarters of the private prison industry, per Marketplace.

What's the problem with private prisons?

Proponents of private prisons often claim they're cheaper than the public alternative. This is debatable for a few reasons. First, private prisons tend to be picky about whom they incarcerate, so they can keep their costs low. As Burkhardt wrote, anecdotal evidence suggests that private prisons avoid people with greater health needs, instead preferring to keep those inmates — and the costs associated with their medical care — on the government's tab.

Protesters outside Otay Mesa Detention Center, a private facility run by CoreCivic, in San Diego, California, in 2018. [ROBYN BECK/AFP via Getty Images]

Offloading costs onto others is actually common with private prisons. Let's stick with health care as an example. In 2010, the Private Corrections Institute, a citizen watchdog group, responded to a joint report by the Reason Foundation and the Howard Jarvis Taxpayers Association that advocated for sending 25,000 incarcerated people in California to out-of-state private prisons. The report claimed doing so would save $1.8 billion over five years.

However, PCI wrote in its press release that the report exaggerated its per-diem rate and failed to consider how private prisons "save" money by offloading costs, writing, "Medical costs for California inmates held in private prisons are capped at $2,500 per prisoner; the state must pay medical expenses above that amount, plus all treatment costs for inmates who are HIV-positive."

It all comes back to a central issue: that private prisons are trying to make max money off of putting people into cages. They're also rife with issues; people formerly incarcerated in private prisons are twice as likely to report being sexually victimized by staff as people in public facilities, for example. In addition, the Sentencing Project's report highlighted that past studies found assaults, including physical ones, in private prisons can occur at double the rate of public ones.

How common are private prisons?

In that same report, the Sentencing Project stated that about 128,000 people are incarcerated in private prisons. This is not a small amount of people by any means, however, it is less than 10% of the total 1.5 million people incarcerated in state and federal prisons in the U.S.

Still, private prisons receive a lot of attention in the media and from politicians. In some ways, abolishing them is seen as something like a silver bullet. Part of it is because they're an easy target; there are plenty of people who are comfortable with incarceration but don't really like the idea of firms making money from it. Private prisons are also a popular target because their abolition wouldn't disrupt the whole system.

"I don't want to talk bad about the companies, but it's about money to them."

That doesn't mean that we shouldn't talk about abolishing private prisons. It's just important to remember they can't be blamed for everything wrong with the carceral system. As the Prison Policy Initiative cautioned, private prisons shouldn't be seen as the fuel driving mass incarceration, but rather as a "parasite" that happily latched onto the U.S.'s pre-existing problem.

How is the private prison industry changing?

Private prisons aren't the only firm-run detention facilities around. Perhaps one of the most concerning areas of growth for private companies is immigration detention. While a small number of the total amount of incarcerated people are being held in private prisons, the opposite is true for detained immigrants. According to the Detention Watch Network, over 80% of them are held in facilities operated by private companies, and numerous reports of abuse have come out of such facilities.

Beyond simply operating the facilities, private companies profit off of carceral institutions in almost every way imaginable. Hadar Aviram, a legal scholar, described this phenomenon to The Nation as "piecemeal privatization," saying that "focusing on private prison companies misses the fact that public correctional institutions are also, essentially, privatized."

Take food as an example. Aramark and Trinity are two of the biggest food service companies contracting with prisons. This privatization of food often comes at the detriment of incarcerated people: As Tim Thielman, a food service administrator at the Ramsey County Correctional Facility in St. Paul, Minnesota, and a past president of the Association of Correctional Food Service Affiliates, told Governing, "You look at those companies, and they're in it to make a profit. I don't want to talk bad about the companies, but it's about money to them, and if there are ways that they can feed [prisoners] products that are lesser quality, [they will]."

It's important to keep in mind how private companies will always find ways to profit if they are given the chance. With the arrival of President Biden, a Democrat, into the White House, many hoped it would signal the potential demise of private prisons — or at least deal a severe blow to business.

However, as The Marshall Project reported, these companies aren't afraid. Instead, they have plans to adapt. Just look at CoreCivic, which started buying up residential re-entry centers, more commonly known as "halfway houses." Per The Marshall Project, CoreCivic only had two halfway houses in 2014, but operated 29 by November 2020.