"ARE THERE NO PRISONS...' ...Are there no workhouses?"
In such fashion did the ghost of Christmas Present
mock Ebeneezer Scrooge's rather insensitive response to the question of
what would become of the poor and disenfranchised in Charles Dickens' A
Christmas Carol. Now according to a special report in the D.C.-based Counterpunch
newsletter (Jan 1-15, 1997), the prisons and workhouses are booming,
not in Dickensian England, but right here and now in the good old U.S.A.
and while the numbers in stir (1.6 million Americans were in prison at
the end of 1995) might appall some, the clanging of the cell doors means
sweet music to the growing privately-owned prison industry.
Thanks to tight government budgets, stricter repeat-offender
sentences, the potential of a cheap labor market, and a more vigorous prosecution
of the "drug war", the kingpin of jailing for dollars, the Corrections
Corporations of America, has seen its stock value soar from $8 per share
in 1992 to $30 in 1996, with an 81% increase in revenue in 1995 alone.
Other-prison-for-profit outfits have seen similar increases, including
Wackenhut, which is now listed among Forbes' top 200 small businesses.
All told, private prisons have seen their "market share" (some
market) grow from five prisons in 1987 to over 100 as of this issue. Numbers
may mean strength, but in the prison racket, numbers mean survival, and
profits. Private prisons have resorted to imposing tougher disciplinary
standards (like making it harder to get time off for good behavior') and
mishandling or losing parole papers and forcing inmates to stay beyond
their release dates in order to maintain the requisite 90-95% occupancy
rate to avoid, as Prudential Securities has said, "low occupancy...
a drag on profits." Prisons have proven such a good source of cheap
labor, corporations are flocking to the jailhouse to maximize profits.
Where prisoners used to hammer out license tags for the state, now they
saw, sew, and solder such items as car parts, clothing, furniture and computer
circuit boards for major U.S. companies. The tactic has proven so lucrative
that the a U.S. company operating in Mexico closed down its operations
and moved them to San Quentin, while another firm dumped 150 workers in
Texas and set up shop in a private prison in Lockhart, where prisoners
now assemble circuit boards for such outfits as IBM and Compaq. State legislator
Kevin Mannix of Oregon has issued an invitation to Nike to shift its operations
from Indonesia to his state. "We could offer competitive prison labor",
says Mannix. How competitive? Pay scales, which may run as high as $400
per month "take home" in government prisons, are as low as 17
cents per hour in private prisons. Pay rates at the CCA prisons max out
at 50 cents per hour for "highly-skilled labor." Such financial
rewards don't go far in the private canteens, where the buy-low, sell high
axiom of the fee market abounds. Inmates in a CCA-run facility in Florida
complain of $2.50 charges for phone calls, and exorbitant prices for necessities
such as soap, toothpaste, toothbrushes, and clothing, which are provided
to inmates at government-run prisons. Of course, the operators of for profit
prisons aren't the only ones on the chow wagon. Large-scale investors too,
capitalizing on hard times, are buying in big. Among ther celebrated names
backing the prison business are American Express, General Electric, Goldman
Sachs & Co., and Merrill Lynch, Smith & Barney. High-tech firms
are scrambling to move items like monitoring systems which bar code prisoners,
while AT&T hustles to get a lock on the prison communication business.
The social cost? Former correction officer Jerome
Miller estimates that the "American gulag" system will house
between three and five million inmates in the next 15 years, composed mostly
of African-American men.
Comment: The price system is resilient. While we acknowledge that
technological change is at the heart of our economic woes, corporate America
losses no opportunity to exploit the trend. Grind a portion of the population
down to the point at which crime is their only out. Then imprison these
people (at taxpayers' expense) and use them to turn out products at wages
amounting to a fraction of those on the outside, displacing higher-paid
workers, many of whom will also be forced into illegal or violent acts
to survive or as a reaction to the stress of economic insecurity (especially
as government support programs are cut to the bone)-thus creating a constant
supply of low-wage inmate workers. What kind of motivation is there to
reduce crime when investors' profits depend on full prisons? Not only do
the chief beneficiaries of the Price System enrich themselves by promoting
the existence of crime, they will no doubt be congratulated by a population
seeking protection from the victims of the very system that is responsible
for most of the crime - and gleefully pour into stores and snatch up those
cheap goods that once again proudly say,
