The Prison-Industrial Complex, Texas Style

by Henry Farrell on November 9, 2009

“This Boston Review piece”: by Tom Barry is very much worth reading, as a background briefing to the “prison funding shenanigans”: recently described by _Talking Points Memo._

These immigration prisons constitute the new face of imprisonment in America: the speculative public-private prison, publicly owned by local governments, privately operated by corporations, publicly financed by tax-exempt bonds, and located in depressed communities. Because they rely on project revenue instead of tax revenue, these prisons do not need voter approval. Instead they are marketed by prison consultants to municipal and county governments as economic-development tools promising job creation and new revenue without new taxes. The possibility of riots usually goes unmentioned. … Initially, most speculative prisons were privately owned, a case of the federal government outsourcing its responsibilities. But prison outsourcing is rarely that simple anymore. The private-prison industry increasingly works with local governments to establish and operate speculative prisons. Prison-town officials have a mantra: “If you build a prison the prisoners will come.”

Most of the time, these public-private prisons are speculative ventures only for bondholders and local governments, because agreements signed with federal agencies do not guarantee prisoners. For the privates, risks are low and the rewards large. Usually paid a set fee by local governments to operate prisons, management companies have no capital investment and lose little, other than hefty monthly fees, if inmate flows from the federal government decline or stop.

… Prisons are owned by local governments, but local oversight of finances is rare, and the condition of prisoners is often ignored. Inmates such as those in Pecos are technically in the custody of the federal government, but they are in fact in the custody of corporations with little or no federal supervision. So labyrinthine are the contracting and financing arrangements that there are no clear pathways to determine responsibility and accountability. Yet every contract provides an obvious and unimpeded flow of money to the private industry and consultants.

The piece isn’t perfect – it can’t quite decide whether it is a story about the problems of the prison system or about the problems of the US approach to immigration. The two are of course closely connected, but each is very complicated in its own right, and trying to explain both at once makes for a top-heavy account. I would also have liked to have seen more aggregate data to support the specific arguments that the author is making (I suspect though that one of the problems with keeping this metastasizing system under control is that there isn’t any source of good general data out there). But it is an eye-opening piece of investigative journalism, looking at a story that doesn’t get nearly as much attention as it deserves. Recommended.



Ginger Yellow 11.09.09 at 4:15 pm

That was the thing that really stunned me about the Hardin situation. Not the fly-by-night operator or the corruption, but the whole concept of building a prison on spec. It just seems insane to build and finance such a thing without even having a contract lined up, let alone signed. I really want to know who buys the bonds that finance these things, because they must be seriously gullible people. Revenue bonds are risky enough at the best of times, but normally they’re for things like sewer systems for which there is clearly a genuine need, or stadia where there’s obvious demand.


Ceri B. 11.09.09 at 5:29 pm

But of course building new prisons is a very safe sort of venture these days. When was the last time American incarceration rates went down much? How many prisons have been closed in recent decades for want of inmates, and how many are grossly overcrowded?


rageahol 11.09.09 at 5:39 pm

These are public health disasters, not waiting to happen, but in progress. Without adequate oversight, you’re just begging for a major infectious disease outbreak, either in the United States, or in the countries where the inmates of these prisons are eventually shipped back to.

three words:
Multidrug resistant tuberculosis


Jim Harrison 11.09.09 at 5:51 pm

As we’ve learned, if there aren’t enough inmates for a private prison, a little money to the right judges and there will be.


Salient 11.09.09 at 5:58 pm

[County Clerk Dianne] Florez complained that the inmates can count on three meals a day and a television to watch while they idle their time away. Not to mention that their rent and electricity bills get paid, while Pecos residents have to work every day to make ends meet.

… Wow.


TGGP 11.09.09 at 6:39 pm

Yglesias had a good post on the problem with bonds a little while back:

Tangentially related, Sasha Volokh on the political economy of prison outsourcing:


Alex 11.10.09 at 12:21 am

The shocking thing about the Hardin story, for me, was the poverty of imagination – their idea of economic development was trying to attract a prison. That’s a lot of defeated, grey-tea cynicism right there.


joe koss 11.10.09 at 2:42 am

In a similar tangental prison vain, I was in Tulsa, OK recently and stumbled upon this article, which I guess is just a natural progression of the current US religious-political-economic situation.

And, of course, one of the biggest supporters of California’s three strike rule is the prison guard union…


Zamfir 11.10.09 at 12:35 pm

Joe koss, that doesn;t look very nefarious to me. Weird, but apparently well intended:

Robinson, himself an ex-con and prison minister, said he had been working for years on the idea of an all-Christian prison, and he had invested $1.3 million so far on construction plans and other expenses.

He said a lot of prisons have faith-based or Christian units, but he knows of none with an all-Christian staff.

“The staff, being all born-again believers, will see this as a mission,” he said.

“I want people to understand what it’s about. It’s about changing criminals into citizens.”

The prison would accept only men near the end of their sentences who volunteer to come into the prison and sign an agreement to participate.

They would work full time at private industries that operate inside the prison, get job training, and earn money.


Chris 11.10.09 at 2:33 pm

@9: I predict that somewhere behind that story there is a Jack Abramoff type laughing all the way to the bank. Born-again Christianity is a great source of money and gullibility, for those unscrupulous enough to take advantage of it. Especially in that part of the country.

When you combine the ability to skim off taxpayer money *and* the ability to skim off religious donations, it’s a great business opportunity. I expect the actual nuts-and-bolts construction and operation of the prison to be contracted out to closely held companies that are very profitably inefficient, but nobody pays attention because they’re too busy praying, or arguing about praying.


Ceri B. 11.10.09 at 2:55 pm

The recent history of Christianist bloc action in the US military, particularly in the Air Force, is such as to suggest that an all-Christian prison will very shortly become a hellhole suitable for producing the next round of torture advisors.


Chris 11.10.09 at 6:01 pm

@11: If they were allowed non-Christian inmates, that would certainly be true; I’m less convinced that they will abuse their own, although it certainly could happen.

It’s not inconsistent with my theory, either. Profiting from someone else’s suffering might seem rather un-Christian in the sense in which that word was formerly used, but Christians have long demonstrated their capacity for hypocrisy when it was useful to them (either individually or collectively).


Martin Wisse 11.11.09 at 11:20 am

Obviously Christian prisoners aren’t real prisoners, so no problem there.


Martin Wisse 11.11.09 at 11:20 am

Real Christians, not prisoners.

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