Private prisons – the best investment in America?
The Corrections Corporation of America is the largest private prison company in the US and has only grown in recent years. With over 60 facilities across the United States, the corporation has thousands of detained prisoners within its walls from coast-to-coast. Why should you care, though? Because an investment in the inhumane caging of convicted criminals means more money for you!
The CCA has made available a virtual tour of its Metro Davidson County Detention Facility for potential investors, and it got the editors at Business Insider curious as to what kind of opportunity a little Corrections Corp. stock could serve. After unearthing a slideshow that serves as a sales pitch, the CCA exposes an eye-opening — and indeed worrying — look into not just how the prison industrial complex continues to thrive off of arresting Americans, but at how the prison system in America at large, private or otherwise, is perhaps not as pretty as you even would have imagined.
More and more states are selling off their facilities to private prison companies like CCA, claims the company, and in turn investors are profiting handsomely. Why are the states selling out, though? The CCA suggests that it’s because government just can’t figure out how to manage facilities on their own. As federal prisons are sold off to for-profit companies, the CCA says that the government’s own facilities are in grave condition. In all, argues the CCA, the federal prison system is at around 140 percent of capacity, meaning that not only is the state seeing its inmates subjected to degrading conditions, but investing in public-turned-profit prisons helps see that such facilities are more properly maintained while also practically guaranteeing a sizeable pool of inmates always keeping the building brimming, and thus the investors’ bank accounts.
Does that mean investing in private prisons will help the CCA afford more buy-outs and make conditions better for detainees? Hardly. The CCA is currently in the midst of a sales pitch with 48 state governments in hopes of adding those institutes to their list of facilities, but under a contract exposed by RT last month, those prisons must be able to guarantee at least 90 percent occupancy during the tenure of a contract with the CCA for them to consider the purchase.
While private prisons account for around one-tenth of the jails in America, the CCA has seen the number of facilities under their watch grow in recent years, seeing a 12.4 percent increase in inmate populations in the last four years. As RT reported earlier this year, that wasn’t a feat easy to obtain. As it so happens, the CCA saw $133 million in income between 2006 and 2008, all the while lobbying Congress to the tune of nearly $3 million. As profits have gone up, so have prison populations, though.
According to the CCA, those numbers are only expected to climb higher.
In one slide used in their sales pitch, the CCA says that they operate “in an industry with positive investment characteristics.” For those novices in the field of prison investment, the CCA breaks that down rather thoroughly. Not only does the CCA reveal that they have limited competition, but investing in a prison is one of the few “recession resistant” gambles you can make. So resistant, in fact, is that the CCA says they thrive off of bad economic times. One talking point made in the presentation is that there is a “potential of accelerated growth in inmate populations following the recession.”
The CCA adds that while “state inmate populations are typically negatively impacted during recessions, as customers control population growth through early release, however, inmate population growth historically has accelerated post recession.”
But come on, CCA! How can someone be so sure that investing in the imprisonment of a fellow citizen is a worthwhile bet? Well, they respond, “prison populations should grow as US populations grows,” with around 18.4 million more Americans expected to be added to the overcrowded facilities by 2016. In recent years the federal prison system has seen an influx of prisoners, in part, argues the CCA, to the growing number of incarceration for immigration-related offenses. As a result, the Immigration and Customs Enforcement agency houses around 12,000 detainees in over 150 jails, which the CCA claims, “many of which do not meet new detention standards.”
With the CCA seeing record profits, should Americans expect the privatization of their detention system to mean better conditions for the immigrants and harmless convicts that make up a good chunk of the prison population? Probably not. By acting now, however, putting some money behind the CCA could prove to be a portfolio addition that any investor will be happy to have down the road.
And if the CCA is wrong? Well that just means more hard economic times, more recession and — ideally — even more over-populated prisons down the line!