NOV. 10, 2010                              Issue #6

Lock 'em up for profit

Private prisons push overzealous immigration laws and incarceration

The corporate genesis of Arizona's divisive new immigration law, brought to light by a recent NPR investigation, dramatically demonstrates that privatizing public functions can undermine the public's best interests.

The nation's largest private prison company, Corrections Corporation of America, was part of a secretive group that wrote the law, the investigation revealed.  The company also made donations to 30 co-sponsors in the Arizona legislature. The law, which requires police to arrest anyone who can't immediately produce immigration documents, is expected to send enough people to prison to generate hundreds of millions of dollars in profit for CCA and other prison companies.

Company documents show that its executives consider immigration detention its "next big market." And they aren't stopping with Arizona.

While a court challenge to the racial-profiling law proceeds, virtually the same bill has been introduced in at least five states – South Carolina, Pennsylvania, Minnesota, Rhode Island and Michigan. Like Arizona, those states have legislators involved in the American Legislative Exchange Council (ALEC), a self-described "limited-government group" that avoids lobbying disclosure by hosting conferences where corporations pay to meet with legislators.

The private prison industry has a long history of political manuevering to boost its income from public funds. A study in 2001 by Good Jobs First, found that CCA had successfully lobbied for federal subsidies for 78% of its prisons. The National Institute on Money in State Politics found in 2006 that two-thirds of campaign contributions from prison companies went to states with the toughest sentencing laws.  ALEC, with funding from several private prison companies, pushed "truth-in-sentencing" and "three-strikes" laws in many states, greatly increasing incarceration rates.  

Even juveniles have been jailed for profit. In 2009, two Pennsylvania judges pled guilty to closing a public detention center, securing the contract for a private company and then sending thousands of teens to detention on trivial charges, all in exchange for bribes from the company.

The public interest – including both justice and the best use of taxpayer's money – has been ill-served by shifting control of vital services like incarceration of criminals to profit-driven corporate interests.

NPR report, part 1 | NPR report, part 2

In The Public Interest, Prisons, Detention & Public safety

Indianapolis moves toward parking contract full of hidden and shifted costs

The Indianapolis City Council will vote Monday on a 50-year contract privatizing public parking. The contract is with ACS, the same contractor  involved in the botched privatization of Indiana's social services. A council committee approved the plan this week despite warnings about privatization fiascoes, corruption and the projection of huge long-term financial loss.

In a fact sheet and op-ed, US PIRG details conflicts of interest, skyrocketing parking rates and the estimated siphoning of at least $400 million to the company. 

As in Chicago, the proposed contract is full of hidden costs. "Non-compete" clauses restrict the city from creating or improving other parking facilities, which could lower ACS’ profit. And the city would have to pay the company phantom meter rates whenever streets must be closed for repairs, parades or anything else that blocks a meter.

US PIRG commentary | US PIRG fact sheet

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