The Corrupt Corporate Incarceration Complex

By William Fisher

Seventeen year-old Hillary Transue did what lots of 17-year-olds do: Got into mischief. Hillary’s mischief was composing a MySpace page poking fun at the assistant principal of the high school she attended in Wilkes-Barre, Pa.

Hillary was an honor student who’d never had any trouble with the law before. And her MySpace page stated clearly that the page was a joke. But despite all that, Hilary found herself charged with harassment. She stood before a judge and heard him sentence her to three months in a juvenile detention facility.

What she expected was perhaps a stern lecture. What she got was a perp walk -- being led away in handcuffs as her stunned parents stood by helplessly. Hillary told the New York Times, “I felt like I had been thrown into some surreal sort of nightmare. All I wanted to know was how this could be fair and why the judge would do such a thing.”

It wasn’t until two years later that she found out why. In Scranton, Pa. two judges pleaded guilty to operating a kickback scheme involving juvenile offenders. The judges, Mark Ciavarella Jr. and Michael Conahan, took more than $2.6 million in kickbacks from a private prison company to send teenagers to two privately run youth detention centers. Since 2003, Ciaveralla had sentenced an estimated 5,000 juveniles. Conahan was accused of setting up the contracts. Many of the youngsters shipped off to the detention centers were first-time offenders. The two judges received sentences of seven years each and are also being sued by numerous parents of the children involved.

PA Child Care is a juvenile detention center in Pittston Township,
Pennysylvania. It was opened in February 2003. It has a sister company,
Western PA Child Care, in Butler County, Pennsylvania. Treatment at both facilities is provided by Mid Atlantic Youth Services. Gregory Zappala took sole ownership of the company when he purchased co-owner Robert Powell's share in June 2008.

In July 2009 Robert Powell pled guilty to failing to report a felony and being
an accessory to tax evasion conspiracy in connection with $770,000 in kickbacks he paid to Ciavarella and Conahan in exchange for facilitating the development of his facilities.

The child care facilities have also been criticized for their costs, which ranged as high as $315 per child per day. Butler county paid Western PA Child Care about $800,000 in payments between 2005 and 2008. Butler county did not renew Western PA Child Care's contract after an extension of the contract ran out at the end of 2008. The juvenile detention center Hillary was sent to was a private-for-profit facility run by one of the more than 50 companies operating in the five billion dollar private prison industry.

These companies have names you’ve probably never heard of -- like Corrections Corporation of America (CCA) and GEO.

Ironically, it’s the federal and state criminal justice systems that produce the private prisons phenomenon and create the opportunity for private operators to capitalize. What they are capitalizing on is America’s obsession with handing out long prison sentences out of all proportion to the crimes committed.

Today, the United States has locked up more prisoners than any other country in the world -- 2.3 million-plus people locked up in state and federal prisons and county jails. This has predictably resulted in a shortage of publicly-owned prison beds – a shortage increasingly being filled by companies that charge so many dollars for each convict sent their way.

Detainees include immigrants who have applied for asylum in the U.S. and others awaiting hearings before being deported. The number of people detained has soared to more than 400,000 a year. According to Immigration and Customs Enforcement (ICE), part of the sprawling Department of Homeland Security (DHS), the average detention is about one month, although some detainees are kept for years. The cost of detention is estimated to be $1.7 billion annually.

In the past five years, the nation’s largest private prison company has partnered with the federal government to detain close to a million undocumented people waiting to be deported or appear before an immigration judge. In the process, Corrections Corporation of America (CCA) has made record profits. Critics suggest that CCA cuts corners on its detention contracts in order to increase its revenue at expense of humane conditions. Thanks to political connections and lobbying, it dominates the immigrant detention industry. CCA now has close to 10,000 new beds under development in anticipation of continued demand.

Judith Greene, a policy analyst with Justice Strategies, a nonprofit sentencing-reform advocacy group in New York, says, "Profits by no means created the machinery of mass incarceration, no more than defense contracts invented war, but the huge profits to be made by incarcerating an ever-growing segment of our population serves the system very well."

"Profits oil the machinery, keep it humming and speed its growth," she adds.

For-profit prison companies claim to be able to provide prison and detention services to cities, counties, states and the Federal Government for less money – an idea that cash-strapped communities apparently find irresistible.

Yet studies throughout the country show that private prisons are only marginally less expensive than public prisons and are often substantially more expensive. The second issue is a medical care regimen that, until recently, allowed the government such wide discretion that it could deny urgent care, including biopsies for suspected cancers and treatment of heart conditions.

Moreover, a panoply of hidden subsidies is rarely calculated into the private prison industry’s cost claims. According to a study by Paul Wright, the founder and editor of "Prison Legal News," a prisoners’ rights advocacy newsletter, at least 44, or 73 percent, of the 60 facilities (studied) had received a development subsidy from local, state and/or federal government sources. Subsidies were found in 17 of the 19 states in which the 60 facilities are located.

Facilities operated by the two largest private prison companies, CCA and GEO, were frequently subsidized. Among the facilities in this study, 78 percent of CCA's and 69 percent of GEO’s prisons were subsidized, suggesting that these companies had been aggressive in seeking development subsidies.

According to the not-for-profit Private Corrections Institute, “the private prison industry relies on a number of allies and research studies to justify its claims of cost savings and proficiency; however, most of these sources have industry connections or vested financial interests.”

For example, it claims, the Reason Foundation, a strong proponent of prison privatization, has received funding from private prison firms. The American Correctional Association (ACA) receives sponsorship money from CCA, GEO and other private prison companies for its bi-annual conferences.

Former University of Florida Prof. Charles Thomas conducted supposedly impartial research on the private prison industry until it was learned that he owned private prison stock, had been paid $3 million for consulting for a private prison firm, and served on the board of Prison Realty Trust (a CCA spin-off). Thomas was fined $20,000 by the Florida Commission on Ethics and stepped down from his University position.

Private prisons are paid according to filled beds. So they are constantly pushing for more inmates – while officials of publicly owned prisons are trying to shed prisoners to relieve overcrowding and reduce expenses.

Private prisons seek to save money by hiring less experienced staff. The result of that policy can be seen in the disproportionate numbers of poorly controlled prison riots, by unsanitary health conditions, by substandard record-keeping, by high employee turnover, and by the number of deaths in detention.

A June 2004 study by academics Curtis R. Blakely and Vic W. Bumphus found that private prison turnover among correctional officers was 43 per cent while turnover in public sector prisons were only 15 per cent. Turnover in for-profit prisons was linked to lower staff pay and less training. Moreover, the study found, “Pay, training, and turnover may all contribute to the higher levels of violence seen in the private sector.”


One big area where for-profit prison firms skimp is on labor costs, according to Paul Wright. “While employees at state-run prisons get union-scale salaries, private-prison guards typically earn $7 to $10 per hour,” he says, adding: "They have low wages and high turnover and very little in the way of benefits or training."

Wright, 43, was once a prisoner himself, serving 17 years of a 25-year term for killing a cocaine dealer he was trying to rob. Today, he is an advocate for prisoner rights and over the years has filed numerous legal challenges against the industry and won.

"The private-prison industry is marked by corruption," he says. "Their premise is they can run prisons cheaper than the government, but taxpayers don't realize any of those savings. Any savings the private-prison industry obtains is basically profits for their shareholders."

For-profit prisons are private corporations and thus not subject to external oversight. They are not obligated to produce their internal records for public scrutiny and are exempt from the Freedom of Information Act at the Federal level because that law applies only to documents in the government’s possession.

Political pressure from interests in US border states has forced President Obama to exceed the record of former President George W. Bush in deporting illegal aliens. That surge has resulted in a windfall for the private prison industry. Today a substantial slice of its current growth can be attributed to its activities in the immigration detention field.

Private prisons have become a major influence in shaping critical legislation related to illegal immigration. The industry’s lobbyists have played a leading role in drafting a number of recent anti-immigrant laws, for example, Arizona’s SB-1070, and similar laws in Georgia, Alabama, and other states.

Under the Alabama measure, police must detain someone they suspect of being in the country illegally if the person cannot produce proper documentation when stopped for any reason. It also will be a crime to knowingly transport or harbor someone who is in the country illegally. The law imposes penalties on businesses that knowingly employ someone without legal resident status. A company's business license could be suspended or revoked. And the law requires Alabama businesses to use a database called E-Verify to confirm the immigration status of new employees.

Lee Fang reports in “Think Progress” that, in December 2009, the American Legislative Exchange Council (ALEC) — a powerful front group that helps corporate representatives craft template legislation for state lawmakers, funded partially by the private prison industry — hosted Arizona State Sen. Russell Pearce (R) and began debate on legislation that would provide broad powers to local police to arrest anyone who might look like an immigrant. ALEC then distributed the template legislation to its members. The January/February 2010 edition of ALEC’s magazine highlights the draft version of SB1070 — the “Support Our Law Enforcement and Safe Neighborhoods Act” — as model legislation.

It was Pearce who introduced ALEC’s “template” as the infamous SB1070 law. Notably, the ALEC task force which helped Pearce devise his racial profiling law included Laurie Shanblum, a CCA lobbyist. CCA previously played an important role in privatizing many of Texas’ prisons.

An investigation by Arizona’s KPHO-TV found more ties between SB1070 and the private prison industry: Paul Senseman, Arizona’s Gov. Janet Brewer’s deputy chief of staff, was a former lobbyist for CCA (his wife is still a lobbyist for CCA), and Chuck Coughlin, Brewer’s campaign chairman, runs the lobbying firm in Arizona that represents CCA.

CCA was set to receive well over $74 million in tax dollars in FY2010 for running immigration detention centers. In a recent presentation, Pershing Square Capital, a hedge fund with a large financial stake in CCA, suggested that CCA’s profitability depends on increasing numbers of immigrants sent to prison. Many of the legislators helping to earn CCA more profits with radical anti-immigrant bills mirroring SB1070 have been recipients of private prison industry cash or have worked closely with the CCA-funded ALEC organization.

“When detentions increased following the September 11, 2001, attacks on New York City and the Pentagon”, author Mark Dow writes, “private prison profiteers saw another opportunity. The (then) Chairman of the Houston-based Cornell Companies spoke candidly in a conference call with other investors: ‘It can only be good…with the focus on people that are illegal and also from Middle Eastern descent…In the US there are over 900,000 undocumented individuals from Middle Eastern descent…That’s half of our entire (US) prison population…The Federal business is the best business for us…and the events of September 11 (are) increasing that level of business…”

Efforts to reach the CEOs of the two leading private prison companies, CCA and GEO, to invite comment on this article were unsuccessful. However, their websites present a comprehensive picture of the companies’ vision of their operations. Both are doing extremely well. GEO’s revenues for 2010 rose 11 per cent to $1.27.billion. CCA’s revenues in 2009 rose to $1.670 billion. The companies’ annual reports and 10-K filings present a robust picture of these operations and strike an optimistic note for the future.

Beau Hodai, considered an authority on the private prison industry, noted in Prison Legal News last year that private prison leaders had substantially increased their spending on lobbying.

For example, he writes, “From January 2008 to April 2010, CCA spent $4.4 million lobbying the Department of Homeland Security and ICE, the Office of the Federal Detention Trustee, the Office of Budget Management, the Bureau of Prisons (BOP) and both houses of Congress. Of the 43 lobbying disclosure reports filed by CCA during this period, only five do not expressly state intent to monitor or influence immigration reform policy or gain Homeland Security or ICE appropriations.”

The private prison industry’s operation of immigration detention centers has been less than stellar – a lot less.

For example:

The American Civil Liberties Union (ACLU) of Texas and El Paso co-counsel Mike Torres and Leon Schydlower filed a lawsuit on behalf of the survivors of Jesus Manuel Galindo. Named as defendants were the federal government and the GEO Group, the administrator of the West Texas for-profit prison where Galindo, 32, died on December 12, 2008, after suffering a seizure in solitary confinement where he had been placed for complaining about the facility’s failure to provide him medication to control his epileptic seizures.

At least nine immigrant prisoners have died in the Reeves County Detention Center in the last five years. The GEO Group has had at least six facilities in Texas shuttered or contracts canceled. The state of Idaho pulled its inmates from the Dickens County Correctional Center in the spring of 2007 in the wake of the suicide of inmate Scot Noble Payne and a subsequent investigation into "squalid" conditions at the lock-up. Idaho also cut its contract the Bill Clayton Detention Center in Littlefield, Texas after the 2008 suicide of Randy McCullough. In October 2007, the Coke County Juvenile Justice Center was shuttered by the Texas Youth Commission after a damning investigation into conditions at the youth detention center.

Despite that record – ironically, on the very day the lawsuit was filed -- the company was awarded a contract by Immigration and Customs Enforcement (ICE) to operate a new 600-bed "civil" detention center in Karnes County, Texas. Texas has more for-profit prisons than any other state.

In another case, a former immigration detention guard was convicted of sexually abusing female detainees in the T. Don Hutto Residential Center, near Austin, Texas, which is managed by Corrections Corporation of America. The resident supervisor, Donald Dunn, 30, was charged with three counts of official oppression and two counts of unlawful restraint, the Austin American-Statesman reported.

The ACLU said CCA officials were violating policy by allowing female immigration detainees to be isolated with male staff members. After an ACLU investigation into sexual abuse at the Hutto facility, Vanita Gupta, Deputy Legal Director of the ACLU, said the charges show additional need for reform.

Then there is the issue of death in detention. Nina Bernstein, writing in The New York Times, alleged that ICE officials, fearful of media scrutiny, conspired to conceal the details surrounding the deaths of a number of detained immigrants who died in privately-run detention centers.

Bernstein wrote that “…it is now clear, the deaths had already generated thousands of pages of government documents, including scathing investigative reports that were kept under wraps, and a trail of confidential memos and BlackBerry messages that show officials working to stymie outside inquiry.”

The documents were obtained by The Times and the ACLU under the Freedom of Information Act. They relate to most of the 107 deaths in detention counted by ICE October 2003, when the agency was created within the Department of Homeland Security. The documents also revealed ten deaths in detention that had never been disclosed by the government. The ACLU says the number of deaths has increased since then.

The article details a litany of abuses. For example:

“As one man lay dying of head injuries suffered in a New Jersey immigration jail in 2007, for example, a spokesman for the federal agency told The Times that he could learn nothing about the case from government authorities. In fact, the records show, the spokesman had alerted those officials to the reporter’s inquiry, and they conferred at length about sending the man back to Africa to avoid embarrassing publicity.”

“In another case that year, investigators from the agency’s Office of
Professional Responsibility concluded that unbearable, untreated pain had been a significant factor in the suicide of a 22-year-old detainee at the Bergen County Jail in New Jersey, and that the medical unit was so poorly run that other detainees were at risk.”

“The investigation found that jail medical personnel had falsified a medication log to show that the detainee, a Salvadoran named Nery Romero, had been given Motrin. The fake entry was easy to detect: When the drug was supposedly administered, Mr. Romero was already dead.”

“Yet those findings were never disclosed to the public or to Mr. Romero’s
relatives on Long Island, who had accused the jail of abruptly depriving him of his prescription painkiller for a broken leg. And an agency supervisor wrote that because other jails were ‘finicky’ about accepting detainees with known medical problems like Mr. Romero’s, such people would continue to be placed at the Bergen jail as ‘a last resort’.”

Another case concerns Yusif Osman, who was a U.S. legal resident from Ghana and had been living in Los Angeles for five years. After a companion carrying false ID landed him in an immigration detention center run by CCA. Osman was facing deportation on smuggling charges, an allegation he denied. While at the immigration detention center outside San Diego, he died suddenly. His story highlights the poor care some immigrants have received in the scores of immigration facilities across the United States.

Near midnight on a California spring night, armed guards escorted Yusif Osman into an immigration prison ringed by concertina wire at the end of a winding, isolated road. During the intake screening, a part-time nurse began a computerized medical file on Osman, a routine procedure for any person entering the vast prison network the government has built for foreign detainees across the country. But the nurse pushed a button and mistakenly closed file #077-987-986 and marked it "completed" -- even though it had no medical information in it.

Three months later, at two in the morning on June 27, 2006, the native of Ghana collapsed in Cell 206 at the Otay Mesa immigrant detention center outside San Diego. His cellmate hit the intercom button, yelling to guards that Osman was on the floor suffering from chest pains. A guard peered through the window into the dim cell and saw the detainee on the ground, but did not go in. Instead, he called a clinic nurse to find out whether Osman had any medical problems.

When the nurse opened the file and found it blank, she decided there was no emergency and said Osman needed to fill out a sick call request. The guard went on a lunch break.

The cellmate yelled again. Another guard came by, looked in and called the nurse. This time she wanted Osman brought to the clinic. Forty minutes passed before guards brought a wheelchair to his cell. By then it was too late: Osman was barely alive when paramedics reached him. He soon died.

His body, clothed only in dark pants and socks, was left on a breezeway for two hours, an airway tube sticking out of his mouth. Osman was 34.

The next day, an autopsy determined that he had died because his heart had suddenly stopped, confidential medical records show. Two physicians who reviewed his case for The Washington Post said he might have lived had he received timely treatment, perhaps as basic as an aspirin.

Privately, Otay Mesa's medical staff also knew his care was deficient. On Page 3 of an internal review of his death is this question:

Did patient receive appropriate and adequate health care consistent with community standards during his/her detention ...?

Otay Mesa's medical director, Esther Hui, checked "No."

The ACLU records that “One man was brought in with such high blood pressure that if he was not in custody, he would have been sent to an emergency room immediately. He was denied treatment and shortly thereafter her suffered a massive heart attack and died.”

The ACLU said he was denied treatment because the treatment he needed – a coronary artery bypass – was not considered an ‘emergency’ procedure, the only condition under which care could be provided.

Another detainee had for over a year been denied a biopsy to detect a possible cancer. He died soon afterward.

The medical neglect they endure is part of the hidden human cost of increasingly strict policies adopted following the Sept. 11 attacks. A Washington Post investigation found that detainees have less access to lawyers than convicted murderers in maximum-security prisons and some have fewer comforts than al-Qaeda terrorism suspects held at Guantanamo Bay, Cuba.

The Post investigation, carried out by Dana Priest and Amy Goldstein, found that the most vulnerable detainees, the physically sick and the mentally ill, are sometimes denied the proper treatment to which they are entitled by law and regulation. They are locked in a world of slow care, poor care and no care, with panic and coverups among employees watching it happen.

The investigation found a hidden world of flawed medical judgments, faulty administrative practices, neglectful guards, ill-trained technicians, sloppy record-keeping, lost medical files and dangerous staff shortages. It is also a world increasingly run by high-priced private contractors. There is evidence that infectious diseases, including tuberculosis and chicken pox, are spreading inside the centers.

Nurses who work on the front lines see the problems up close. "Dogs get better care in the dog pound," said Catherine Rouse, a contract nurse at an Arizona detention center who quit after two months last year because she saw what she regarded as "scary medicine" in the prison: patients taken off medications they needed and nurses doing tasks they were not qualified to do. "You don't treat people like that. There has to be some kind of moral fiber," Rouse said.

Bob Libal, senior organizer for Grassroots Leadership in Austin, Texas – considered by many to be the “guru” of private prison opposition – summed up the situation as he sees it. He told Truthout, "A litany of human rights abuses, scandals, and lawsuits have plagued private prisons corporations, particularly in Texas, where there are more private prisons, detention centers, and jails than in any other state," he said, adding:

"Unfortunately, the private prison industry has fought even the most limited oversight and transparency measures. Furthermore, the largest private prison corporations - CCA and GEO - spend millions of dollars each year on lobbying and campaign contributions that ensure that their interests - an ever increasing flow of prisoners and detainees into private beds - are met."

ACLU Attorney David Shapiro told Truthout that two issues play a major role in creating an environment in which death and deprivation in detention become inevitable. The first issue is the absence of any enforceable standards for the maze of 400 federal, municipal, county and private jails used by ICE to house immigrants.

The second issue is a medical care regimen that, until recently, allowed the government such wide discretion that it could deny urgent care, including biopsies for suspected cancers and treatment of heart conditions. As a result of an ACLU lawsuit, there is now a new document that defines the medical care to which detainees are entitled. But lack of independent oversight casts doubt on the extent to which the new regimen is being followed.

The Obama administration has declined to produce system-wide enforceable standards for the prisons its uses to house immigrants. Shapiro declined to speculate on the administration’s rationale, but others have said that it is based on the wide differences between the various types of facilities used by the government. It has also failed to produce a medical care program that is binding on ICE personnel and its contractors. A number of the reported deaths in detention have been caused by ICE’s failure to provide timely medical interventions in emergency situations. Some observers believe that the rationale for deciding against providing “long term” medical care – for example, biopsies – is that ICE detention is largely short-term.

Yet ICE and its DHS parent department have acknowledged that many immigrants are held in custody for years. ICE has also admitted many of the deficiencies in its detention system and have vowed to initiate reforms. But Shapiro contends that the most recent documents obtained by the ACLU show that ICE’s culture of secrecy has not changed.

Bernstein’s New York Times article says that the documents show how officials — some still in key positions — used their role as overseers to “cover up evidence of mistreatment, deflect scrutiny by the news media or prepare exculpatory public statements after gathering facts that pointed to substandard care or abuse.”

As of today, there are no legally enforceable rules governing immigration detention, despite an order by a federal judge to create such rules. The Obama administration refused the judge’s order, which followed a petition filed in court by former detainees. Instead, ICE chose to follow an inspection system instituted during the administration of George W. Bush. That system relies in part on private contractors. Judge Denny Chin ruled that the agency’s failure to respond to the plaintiffs’ petition for two and a half years was unreasonable.

DHS contended that rule-making would be ”laborious, time-consuming and less flexible” than the review process now in place. It said its current inspection system would “provide adequately for both quality control and accountability.”

According to Paromita Shah of the National Immigration Project of the National Lawyers Guild, one of the plaintiffs, the government’s decision “disregards the plight of the hundreds of thousands of immigration detainees.” She claims that the absence of enforceable rules is the major cause of problems of mistreatment and medical neglect. “The department has demonstrated a disturbing commitment to policies that have cost dozens of lives,” she says.

In the view of numerous observers, ICE is itself a highly dysfunctional unit. Thus far the promises of significant operational changes have not come to fruition. The agency remains opaque.

But it is precisely this condition that presents private prison contractors with growing opportunities to pitch their services. Increasing numbers of alleged illegals are being detained by ICE and its various programs, such as 287(g), which enlists local police forces to suss out people in this country who they say shouldn’t be.

As to the future of the private prison industry, its reach is vast – from the teenager in Pennsylvania to the undocumented worker in Arizona. The ACLU’s Shapiro told Truthout, "The main thing the government should do is stop using private prisons. They are a failed experiment and have contributed to mass incarceration, horrid conditions, and escalating costs. At minimum, greater oversight and transparency are critical."

But President Obama continues to use detention and deportation as a political tool to curry favor with the hard right. In the process, myriad injustices are being committed. And with the 2012 election looming, it seems unlikely that Washington has the appetitite to actually fix any of the headaches caused by ICE and its for-profit prisons.
In a chapter from a forthcoming book, Alex Friedmann, associate editor of Prison Legal News, writes, “The most harmful effect of private prison companies is that they have made imprisonment-for-profit politically and socially acceptable, thereby creating an insidious industry that benefits from incarceration while instilling the notion that justice literally is for sale and crime does in fact pay.”

He adds, “Hopefully, at some point in the future we will look back on the time when private prisons were considered sensible and wonder how such a destructive concept was allowed to exist. For now, though, we must deal with the harsh reality of the private prison industry, including its many flaws and harmful effects on prisoners, our justice system and society as a whole.”




This article originally appeared in Truthout.org