For-Profit Prison Industry

In the U.S., approximately 75 percent of the private prison market is controlled by two companies: Corrections Corporation of America and GEO Group.

Source: CCA Investor Materials
Source: CCA Investor Presentation, May 2013

Both companies are financially dependent upon a growing demand for prison beds, and lobby extensively for state and federal contracts as well as laws and policies that increase demand, i.e. policies promoting the mass incarceration of communities of color and immigrants.

How did we get here?

The private prison industry cites overcrowding in public facilities as a reason for its ensured growth. In April 2013, the Federal Bureau of Prisons was at 136% capacity. As of December 31, 2011, 24 states were operating at 100% or more of their highest capacity measure. The private prison industry lobbied for the creation of this problem independently and through the American Legislative Exchange Council (ALEC).

ALEC helped pioneer some of the toughest sentencing laws on the books today, like mandatory minimums for non-violent drug offenders, “three strikes” laws, and “truth in sentencing” laws. In 1995 alone, ALEC’s Truth in Sentencing Act was signed into law in twenty-five states. (Then State Rep. Scott Walker was an ALEC member when he sponsored Wisconsin’s truth-in-sentencing laws and, according to PR Watch, used its statistics to make the case for the law.) More recently, ALEC has proposed innovative “solutions” to the overcrowding it helped create, such as privatizing the parole process through “the proven success of the private bail bond industry,” as it recommended in 2007. (The American Bail Coalition is an executive member of ALEC’s Public Safety and Elections Task Force.) ALEC has also worked to pass state laws to create private for-profit prisons, a boon to two of its major corporate sponsors: Corrections Corporation of America and Geo Group (formerly Wackenhut Corrections), the largest private prison firms in the country. An In These Times investigation last summer revealed that ALEC arranged secret meetings between Arizona’s state legislators and CCA to draft what became SB 1070, Arizona’s notorious immigration law, to keep CCA prisons flush with immigrant detainees. ALEC has proven expertly capable of devising endless ways to help private corporations benefit from the country’s massive prison population.

Read more:

In a CCA-funded study, Temple University researchers recently came to a conclusion that no other economic or social justice watchdog group had come to: private prisons provide a cost savings of approximately 12%.

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