“Warehousing” For Profit

In 1984, the first private prison contract was awarded to Corrections Corporation of America (CCA),the largest private prison contractor in the country.

This contract was awarded to CCA by Lamar Alexander who was governor of Texas at the time. His wife, Honey Alexander, was a major stockholder in CCA from its’ inception. CCA houses over 80,000 inmates.

Most private prisons are paid between $25,000 -$50,000 per head- per year. The more ”beds” they can fill, the more money they make. So the objective of a private prison is to “warehouse” as many people as possible.

In some cases, as private prisons ran out of cells, they put inmates in a gymnasium type setting in bunk beds stacked 3 high. Some were lined up in hallways. The more bodies private prisons could “warehouse”, the more revenue they generate.

Forced Prison Labor

In addition, inmates in some private prisons inmates are forced to work for pennies per hour making products or providing services for some of the largest companies in this country. Everything from computers to tires to furniture and more is made behind prison walls.

“Hiring out” prison labor is also is very profitable for private prisons. There are no taxes to pay and no insurance to provide. If an inmate refuses to work, he can be locked up in solitary confinement or have his sentence extended or both.

Private prison stock is traded on Wall Street. Stockholders make a profit based on how many individuals are continually incarcerated in a private prison they have invested in.

Investors also profit from the nearly free “labor pool” provided by prison labor. China is so offended by this practice, they recently announced as a condition of trade that any exports to China from the United States must not be made by prison labor. During the 1990′s, Texas built one university and 77 prisons.


Extending Time for Profit

In addition, private prisons can extend the length of time of imprisonment because of minor infractions. Inmates including low level non violent inmates in private prisons have their sentences extended at eight times the rate of state run facilities.