> Taken to its logical conclusion, private companies are making money hand over fist with private prisons, from the amount taxpayers pay to house inmates, and from modern day slave labor of prison “jobs” making products.
Given that private prisons cost less than state run ones, do you think taxpayers would prefer to pay more for prisons just so that companies running private prison don’t make a profit? Do you apply this logic also to construction projects? I.e. would you prefer to pay, say, twice as much for a bridge to be build by government construction agency, so long as no private construction company makes a profit building it?
> I agree, but there's another way to think about this: every prison is for profit.
Even publicly owned prisons have to contract out and outsource a lot of the services they need. Private companies supply food, maintenance, cleaning, IT, supplies, construction, architecture and so on.
Private companies also benefit from the cheap to free forced labor they get from government-owned prisons, as well.
There are layers to the grift that lines the pockets of private interests in the prison industry, and those layers certainly don't end at whether a prison is privately owned or not.
> Taken to its logical conclusion, private companies are making money hand over fist with private prisons, from the amount taxpayers pay to house inmates, and from modern day slave labor of prison “jobs” making products.
Tho it's not just private prisons, even federal prisons and state jails have massive rat-tails of private industries servicing them [0]
Nor are private companies the only ones outsourcing labor to prisons, the US military is also doing it [1]
> private prisons maintain costs far better than public prisons
possibly, but the issue is not cost conservation; the problem is that there are shareholders who benefit the more people are sent to prison. This creates perverse incentives (lobbying for stricter/longer sentencing, bribing officials, etc.).
> The same factor that makes private prisons problematic also makes taxation problematic - in both cases you've got a captive market that can't opt out thus no pressure to provide a good, efficient service.
What you should have are companies that offer their best prices/services to the government out of fear that they'll be passed over and those highly valuable contracts will be awarded to their competitors who do better. Governments are incentivized to select the best companies to award those contracts to because they risk being voted out if people are unhappy with the level of service they're getting for their tax dollars.
Prisoners can't kick politicians out of office when they're unhappy about the state of the prisons so that's a huge issue with prisons in general, but private prisons have another issue which is profit. Whatever it costs to keep dangerous people locked up, private prisons need all of that money plus they must extract a bunch of extra money from the public just to stuff their pockets with. If private prisons want to keep prices low to the public but also want to keep filling their pockets with money they need to provide substandard care to the people they are responsible for. A non-private prison needs only what it costs to do the job and nothing more.
> A real issue IS who owns or manages the prisons. If the profit motive is what drives prison expansion, then society will experience a form of regulatory capture in hyperacceleration.
The thing is, profit motive is there regardless of whether you call the prisons "private" or "public," because the people constructing, supplying, and running the prisons are (presumably) getting paid, and those people don't suddenly stop having personal incentives if you start calling them government employees.
Very true, and equally applicable to many other "private" companies (Lockheed-Martin comes to mind).
> How can this be true while tax payers are simultaneously footing the bill?
Private prisons (that include inmate labor) charge from both ends: per-head to the taxpayer (ostensibly at a lower rate than if the state handled it in-house), and per-hour to businesses seeking cheap labor. State prisons have only the first incentive, with the countervailing force of finite tax revenue.
Also, the prison guard unions have the same incentive to lobby (and/or support the lobbying of their parent corporation) regardless of who signs their checks. I would claim that union influence and lobbying is a constant in either case.
> But when there are unions, and the jobs of union members depends on the number of prisoners, it becomes much less clear.
Agreed. It is bad policy and a waste of taxes in either case.
> See: privately owned prisons that require a quota to be filled
That's not quite correct. The contracts do not require that a certain number of prisoners be kept in the prison. They require that a certain number be paid for. The contracts are essentially of the form that the state will pay $X to house up to Y prisoners, and $Z/prisoner for any prisoners beyond Y prisoners.
Since private prisons are only a small fraction of the prisons, the people that should be most annoyed by this are the employees of state run prisons. If crime goes down in a state and they want to close a prison to save money they most likely will make sure to fill the private prison first (since they are already paying for it) and cut staff at the state prisons.
(NOTE: this does NOT mean I'm saying private prisons are fine--just that contracts that guarantee a minimal payment regardless of occupancy are not necessarily bad. Private organizations tend to have less oversight than state run organizations, so it would not at all surprise me if the private prisons have staff that are not as well trained or as accountable as state prison staff. If I were setting up a prison system and it was going to allow private prisons, I'd probably require that the warden be appointed by and employed by and answer to the state, not the prison owner, and has the ability to fire private prison employees who are in jobs that involve direct interaction with the prisoners. I'd also require penalty clauses in the contracts that reduce payments if conditions are not at least as good as those required of state prisons.
It would be interesting to look at the strength of whatever public employee union represents state prison employees in each state, and see if there is a significant correlation between that and state use of private prisons. I'd expect weaker unions would increase the chances of private prisons.
>> Private companies have a greater motivation to maximize profits than public entities do.
Corrections officers unions have strong motivations to keep prison populations high as well and unions tend to be stronger in the public sector than the private sector so its not obvious that private prisons increase the aggregate political pressure for high prison sentences.
This seems like a serious inversion of cause and effect. Our problems with prisons pre-dated the growth in private prisons and private prisons remain a small fraction of the overall prison industry so its hard to see how private prisons could be the primary source of the problem.
> So yeah it doesn't matter if the final user is for-profit if you think there is a risk that profit is driving something you don't want.
This is a gross simplification that erases the very real differences between the incentives of a government vs. a for-profit company. Not only is the government accountable to its electorate, but a government that wants to save money can take a much broader approach - for example by funding access to mental health services - to keep people out of prison. Prisoners are expensive to keep locked up!
In the final analysis, all prisons are non-profit. None of them generate any value. They're all funded with taxpayer money that could be spent elsewhere. It's just that in the case of private prisons that money goes to a company that has no interest in saving the government money by reducing the prison population. Sure they'll try to run the prison efficiently, so they can pocket the difference, but they want as many prisoners as possible to get a bigger check from Uncle Sam.
> They often lobby for minimum occupancy levels in law (effectively requiring by law a certain percentage of citizens to be marked as criminals)
I'm not sure that any actually do that. The ones I've seen turned out to be misunderstandings of the contract. The contracts were of the form that the private prison would be paid a base amount of $B to house up to C prisoners, plus an additional amount of $V per prisoner for each prisoner over C. C is typically something like 90 or 95% of the maximum capacity of the prison.
The contract actually makes more profit for the private prison if it has fewer prisoners, with the total profit going down for each additional prisoner up to C. Whether profit goes up or down for additional prisoners beyond that depends on whether $V is less than or greater than $B/C. If it is greater, than profit will go up as the last 5 or 10% of the capacity is used, but it will still be lower than the profit when the prison was at around 80 to 85%.
From the state's point of view the total cost is $B to house anywhere from 0 to C prisoners, and $B + (n-C) $V if the number of prisoners, n, is > C. From the state's point of view, $B is essentially a sunk cost.
This does provide some incentive to politicians to keep the private prisons occupied up to at least C prisoners, because if they have n < C prisoners, the per prisoner cost to the state is $B/n. If that is too high, the opponents are going to say the politician is spending too much on prisons. Increasing n lowers $B/n, so the politician might be tempted (and it also makes them look tough on crime). That's probably easier for the politician that trying to explain to voters that the total is $B regardless of many or few prisoners are there, and so per prisoner cost is not really what you should be looking at.
Also, note that this kind of incentive goes the same way with public prisons. A public prison also has a bunch of fixes costs, and so if you look at cost per prisoner you are going to see a lower cost per prisoner with higher occupancy because of those fixed costs.
>> The majority of prisons are still state owned and run.
Do you also have privatisation happening by the back-door?
i.e. how many private services do the public prisons use? You get some weird situations where public institutions use staff from contractors, rent buildings and buy in all their services.
"The only difference is that if there are two prison companies, and one of them is really bad, citizens can fire it (through pressure on their elected representatives) and hire another with relative ease."
You don't honestly believe that, do you? For one, you're assuming that enough citizens will actually care enough to make this an issue. For two, you're discounting the number of people who think that anything other than a dank, dark dungeon where people are chained to the walls is "coddling" prisoners. Third, I do not buy the schlock that is the argument "private entities are always better than public ones."
> This problem is not limited to the private prison business. In California, for example, the prison guard union is similarly motivated by profits to increase incarceration rates.
I happen to think that you're both right. I'd rather not see union-owned or for-profit private prisons due and I'm not convinced that we really have to choose one or the other.
Given that private prisons cost less than state run ones, do you think taxpayers would prefer to pay more for prisons just so that companies running private prison don’t make a profit? Do you apply this logic also to construction projects? I.e. would you prefer to pay, say, twice as much for a bridge to be build by government construction agency, so long as no private construction company makes a profit building it?
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