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The plot continues to thicken in the search for convicts Richard Matt and David Sweat who pulled off a Shawshank Redemption-style escape from Clinton Correctional Facility in upstate New York last Saturday.

The first questions on everyone’s mind when they hear about something like this is, “How on earth does this happen? Did they just tack on the ‘maximum-security’ part for fun?”

It also raises the questions of how the state prison is managed and, in turn, whether private ownership could operate the facility more effectively.

While these ideas inspired me to look into how the prison industry finances its security systems, my search took me down an entirely different path.


Prisons for Sale


In 2012, the nation’s largest owner of private prisons, the Corrections Corporation of America (CCA), made offers to 48 different governors to buy their state-operated prisons. Left with major financial troubles in the wake of the recession, state governments were struggling to pull together the necessary funding to run their prisons.

The CCA stepped in and offered to relieve the suffering of these governments by buying up their prisons in exchange for 20-year management contracts. The CCA promised it would save millions of dollars in state funds over the period of its prison ownership.

Sounds all well and good, and in almost any other scenario I’d say it was the perfect example of business stepping in to remedy the wounds of an ailing government. But, as with any good story, it just isn’t that simple.

In this story there are three major problems:

The CCA required the prisons to be packed to the brim with inmates at all times.

Taxpayers actually ended up seeing a lot more red than black on their balance sheets.

Our public infrastructure was placed in the hands of the very people our legal system decided were unfit to be a part of society.


Occupancy Requirement


Essentially, the Corrections Corporation required a lockup quota. For most states in this case the quota was 90 percent (in Arizona there were three prisons with a quota of 100 percent).

This is actually a fairly common practice within this industry, as it allows for fixed operational costs to be covered regardless of the occupancy in the prison. This ensures that the prisons will remain up and running, which is a very good thing unto itself.

However, as a taxpayer, this raises a very important question: What happens when the crime rate dips and there aren’t enough prisoners to fill the quota?

A decrease in the crime rate is a good thing for obvious reasons, but the occupancy requirement actually incentivizes the incarceration of more people, and for longer sentences, in order to ensure that occupancy is always met.

On top of that, when the quota isn’t filled, taxpayers are still responsible for covering the cost of the empty prison beds, so taxpayers see no fiscal benefit even from an improved crime rate.


Taxpayers Spending More


Sound bad? It gets worse.

One of the biggest pros to having private business take control of prisons is that it’s supposed to save millions of dollars for the state, thereby saving taxpayers money. So, when this doesn’t turn out to be the case, people have the right to get angry.

In the case of the Lake Erie Correctional Institute in Ohio, the Department of Rehabilitation and Correction claimed that the CCA’s operating costs would be “8 percent less than estimated state operational costs, generating a projected $3 million in annual savings for Ohio taxpayers.”

It’s a damn shame that a report by Policy Matters Ohio calculated that taxpayers would actually pay around $11 million more over the 20-year period due to annual ownership fees and other costs owed to the CCA.

The Ohio government could have saved its people a ton of money had it either negotiated a better contract with CCA or more efficiently managed these prisons in the first place.


Outsourcing of Labor


Prisoners make for convenient, cheap manual labor — just ask Warden Norton. That meant paying prisoners anywhere from 17 cents to $2 an hour to work on our roads, waterways, and other public projects.

This is quite possibly the toughest pill to swallow. Taking away jobs from able-bodied Americans to outsource them to convicted felons is no way to empower the nation’s labor force.


Our Take


In the end, there’s no point in playing the blame game because everyone involved had a hand in creating this mess.

The CCA was just trying to conduct smart business, but they cut corners when they decided to inaccurately represent its costs and operational procedures.

The state governments were simply attempting to stop the bleeding from the recession, but, in their desperation, they didn’t properly vet their options in handling the prison system.

And we can’t ignore who is possibly the largest contributor to all of this: ourselves.

We are the voting body of this nation. We elect the officials who run our state governments and make these massive decisions on our behalf. As citizens, we need to inform ourselves and be a mobile force if we wish to see our best interests looked after.


Posted 06.12.2015 - 06:30 pm EDT

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