Last week, three corporations announced their collective divestment of $60 million from the Corrections Corporation of America (CCA) and the GEO Group, the two largest private prison companies in the US.While that’s basically peanuts for an industry that pulls in more than $5 billion in annual revenue — with 75 percent going to the CCA and GEO alone — critics of private incarceration see it as an early sign of the industry’s inevitable downfall.Inmates are losing their privilege to get laid.“We are just starting to turn the corner on mass incarceration. For the past 40 years we have been addicted to incarceration, and the number of people in prison grew by 700 percent from 1970 to 2010 in the US,” Carl Takei, an attorney at the ACLU’s National Prison Project, told VICE News. “It’s going to take a while to wind that back down to a level that’s less insane. But the private prison industry depends on mass incarceration to continue to profit, and to the extent that we are turning away from mass incarceration, that undermines their business model.”Last week's announcement came as the result of the National Prison Divestment Campaign, an initiative by the civil rights group Color of Change and 15 other organizations.
'The number of people in prison grew by 700 percent from 1970 to 2010.'
The group reached out to more than 150 companies, pressuring them — as well as state governments — to pull their support from a private prison industry it blames with brutality, excessive sentencing, and racial discrimination.
'Black and brown bodies are not for sale.'
Instead, the argument that prisons are actually a pretty shitty investment — financially speaking — is a winner.“At the end of the day, if you're a money manager, your primary concern is to make clients money,” a representative of Anonymous Analytics told VICE News. “If that means investing in guns and kitten crushers — cool.”Last summer, the group released a detailed report to investors, arguing that as states enacted cost-saving reforms and crime rates lowered, the CCA had started descending form its peak, and was turning into a pretty “horrible financial investment.”
'If you're a money manager, your primary concern is to make clients money. If that means investing in guns and kitten crushers — cool.'
But what’s unique about last week’s announcement is that it was reportedly the first to come as the result of financial considerations as much as moral ones.After decades of throwing money at prisons, states have finally realized that locking up a significant part of their population — more than any other country, both per capita and in absolute terms — is actually not very cost effective.The prison boom may in other words be getting closer to an end, and as states look for cheaper alternatives to incarceration, investors look at prisons as long-term guarantors of profit with more skepticism.“Investment in private prisons and support for the industry is financially unsound, and divestment was the right thing to do for our clients, shareholders, and the country as a whole,” DSM President Hugh Welsh said in a statement announcing his company’s decision to divest. “DSM is committed to good corporate citizenship and operating in a way that contributes to a better world.”Ohio just doubled down on drug cocktail that tortured a death row inmate before killing him. Read more here.The CCA slammed the divestment campaign, criticizing its organizers' fact-checking and their failure to propose alternatives.“Our company saves taxpayers millions, helps keep communities safe, and enrolls thousands of inmates every year in reentry programs that reduce recidivism,” Jonathan Burns, a spokesman for the corporation, told VICE News in an email. “It’s unfortunate that a political group would advocate against those benefits without themselves providing any solutions to the serious challenges our corrections systems face. Overcrowding and skyrocketing costs aren’t solved with politics and posturing.”
'Investment in private prisons and support for the industry is financially unsound.'
“They are really trying to squeeze states for more money, and trying to open up new revenue streams in the worst way,” Nelson said.These include “lockup quotas” — contracts by which states have to pay fines if they don’t fill a high percentage of prison beds — and extra emphasis on youth incarceration.“Which is disruptive because there is no incentive for rehabilitation in private prisons,” Nelson said. “And the industry knows that youth offenders who are not given an opportunity to rehabilitate will then likely end up in an adult prison system, so the companies can continue profiting from them.”The group has also accused the companies running private prisons of lobbying for legislation that promotes incarceration — including, increasingly, the incarceration of undocumented immigrants. The CCA denied the allegation.“From the perspective of the private prison industry it doesn’t matter who’s in their prison as long as they have bodies,” Takei said, explaining that prisons’ profits are counted in “man days” — regardless of whether those locked up are criminals, minors, or immigrants. “The handing of prisons over to for-profit companies is a recipe for abuse, neglect and misconduct."That — and the realization that prisons won't continue to pay off forever — will eventually bring more divestment, he said."Because of all of the information that’s been coming out about what private prisons are doing and their business model, there are more people who simply don’t want to be associated with this industry,” Takei said. "It's very hard for somebody who looks at the industry and understands how it operates to come away thinking it's an ethical industry."Follow Alice Speri on Twitter:@alicesperiPhoto via Flickr
'It doesn’t matter who’s in their prison as long as they have bodies.'