CCA offers to buy prisons from 48 states

Desperation or disaster capitalism by CCA? Trying to get as entrenched as possible before more people catch on that private prisons don’t save money for states?

Andrew Jones wrote for Raw Story yesterday, Private prison company offers to buy 48 states’ prisons

In exchange for keeping at least a 90 percent occupancy rate, the private prison company Corrections Corporation of America (CCA) has sent a letter to 48 states offering to manage their prisons for the low price of $250 million per year, according to a letter obtained by the Huffington Post.

The company says it’s a way for states to help manage their current budget crisis. “We believe this comes at a timely and helpful juncture and hope you will share our belief in the benefits of the purchase-and-manage model,” CCA chief corrections officer Harley Lappin said in the letter.

What does CCA want in return?
…a 20-year management contract, plus an assurance that the prison would remain at least 90 percent full….
So if a state, such as Georgia, was thinking of sentencing reform, or of getting on with decriminalizing drugs, either would become quite difficult after signing such contracts.

Here’s CCA’s offer letter, complete with a blank to fill in for the state.

Maybe CCA is realizing that it’s coming to the end of its rope on its old tricks, such as these, pointed out by Chris Kirkham in HufffintongPost yesterday,

The move reflects a significant shift in strategy for the private prison industry, which until now has expanded by building prisons of its own or managing state-controlled prisons. It also represents an unprecedented bid for more control of state prison systems.

Corrections Corporation has been a swiftly growing business, with revenues expanding more than fivefold since the mid-1990s. The company capitalized on the expansion of state prison systems in the ’80s and ’90s at the height of the so-called ‘war on drugs,’ contracting with state governments to build or manage new prisons to house an influx of drug offenders. During the past 10 years, it has found new opportunity in the business of locking up undocumented immigrants, as the federal government has contracted with private companies in an aggressive immigrant-detention campaign.

New opportunity to the tune of a ten-fold increase in CCA’s stock price, according to Bloomberg.

Yet so far no other states have followed Arizona, Georgia, and Alabama in passing bogus “anti-immigrant” laws like GA HB 87 that actually produce many new crimes that lock up people in CCA’s prisons. This is despite ALEC lobbying to pass such bills in 24 states. So CCA is trying a new strategy: buying prisons.

So far, only Ohio has actually sold a prison to CCA. Ohio, the same state where last year six prisoners, including five convicted murderers, escaped from another CCA-run prison. Private prisons are a public safety problem.

Why would any state sell a prison to a company like that, or offer it a management contract? CCA is counting on states to be desperate:

In recent years, Corrections Corporation of America has made it clear that it sees opportunity in the new era of state budget crises. During earnings calls with investors, company executives have pointed out that the Great Recession has brought renewed interest in privatization.

“We continue to believe we are very well-positioned in a market that, despite the economic pressures faced by our customers, has provided healthy financial performance,” Corrections Corporation chief executive Damon Hininger said in the company earnings call last November. “Indeed, it is because of these pressures, which lead to severe capital constraints and the need to avoid increasing their pension liabilities, that we believe our value proposition to customers is getting stronger.”

That’s disaster capitalism, or “the shock doctrine”:
using the public’s disorientation following massive collective shocks … to achieve control by imposing economic shock therapy.
In this case, the shock is budget shortfalls engineered by tax cuts. In Ohio, for example, tax cuts for the rich were the main source of the budget problem.

Any state can fall for that disaster capitalism pitch. Louisiana’s governor wanted to, but its legislature refused.

Louisiana State Treasurer John Kennedy compared the strategy to “a junkie selling the television set and radio to generate money for his next fix.”
How about instead we take away the need for the junkie to get a lot of cash for the fix and for a state to get a lot of cash to pay for prisons?

A state that really wants to save money could reform sentences so nonviolent prisoners get out onto probation, parole, and rehabilitation. A state that wants to save a lot of money could decriminalize drugs: legalize, regulate, and tax. That would drastically reduce the prison population, removing any excuse to privatize prisons, while producing tax income for the state just like now from tobacco and alcohol.

This sounds like good news:

State corrections officials who were contacted in California, Pennsylvania, Virginia, Montana, Georgia, Texas, Illinois and New York all said they were not considering such prison sales at this time.
Until we recall that Georgia wants to let CCA build new private prisons, which is even worse, because it expands the prison system for CCA’s profit at taxpayer expense.

CCA admits that local community opposition could affect its ability to site a prison. We don’t need a private prison in Lowndes County, Georgia. Spend those tax dollars on rehabilitation and education instead. Follow this link to petition the Industrial Authority to reject CCA’s private prison in Lowndes County, Georgia.


1 thought on “CCA offers to buy prisons from 48 states

  1. Barbara Stratton

    As always, LAKE is doing a fantastic job of uncovering the shadows. However, please note there is a difference in capatalism & crony capitalism. Liberals have their fair share of the crony variety also AKA Soros & Monsanto, GM,etc. Free enterprise & capitalism is why our borders are being crossed legally & illegally, but crony capitalism will destroy us. If the government chooses to privatize there should be clear total delineation between them & the private business, not fascist public/private partnerships like CCA is courting. We need to resist P3s totally, but they are being welcomed with multi grant incentives & blessings of the Dept of Community Development & its Chamber of Commerce conduits. We are on the same team always for transparency in government & we can be on the same team against CCA if we focus on fighting the 3P concept.
    Just a reminder, I used to work for CCA & I still love to see bad men in shackles (emphasis on bad). I don’t share most of what I call simplistic liberal views on prison reform, but I am certainly with you against crony capitalism especially the public/private partnership variety. As I’ve said before they are just the good old boy system, legalized, subsidized, & on steroids.

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