Private prisons incarcerated nearly 100,000 people in 2020. While that’s only eight percent of the total state and federal prison population, it represents a 14 percent increase from two decades before.  It’s 100,000 people too many.

It was good news that during his first week in office, President Biden, echoing a similar Obama-era policy, signed an executive order intended to phase out the Federal Government’s “reliance on privately operated criminal detention facilities.” (Unfortunately, it didn’t include detention facilities managed on behalf of U.S. Immigration and Customs Enforcement; almost 80 percent of the people in ICE custody are in privately owned or operated facilities). Biden’s policy, coupled with activists’ efforts to convince large lenders not to finance private prisons, may put a dent in the outlook for the future of private prisons.

And while some states are doubling down on their use of private prisons, others are turning away from them.

But even if the trend turns downward for private prisons, private companies continue to make inroads inside prison facilities.

Contracting for everything from telephone and videocall service, to food service, to money transfer services, to healthcare, private companies are stepping in, promising savings to the public and the public officials with whom they contract. But this privatization creep offers dubious benefits to the public, and a bad deal for the incarcerated.

The prison phone industry does over a billion dollars in business every year, the vast majority of which is split between just two prison-telecommunications companies, clout allowed them to set outrageously inflated call rates—about ten times more than the average per-minute rate. Last week, President Biden signed a bill into law aimed at curbing those predatory fees.

“Meaningful communication and connection with loved ones helps promote rehabilitation, and it also reduces recidivism, which makes our communities safer,” said Vanessa Chen, Special Assistant to the President for Criminal Justice and Guns Policy.

Still, the new law itself—which clarifies the Federal Communications Commission’s jurisdiction—doesn’t actually cap the rates, which might be why the bill received bipartisan support. Instead, it ensures “just and reasonable charges.” It’s a step, even though small.

JPay, owned by a private equity firm, provides financial services to prisons and jails. In 2021, it was forced to pay $4 million in consumer redress and $2 million in penalties for violating the Consumer Financial Protection Act by charging recently-release inmates fees for accessing their own money. The company also violated the Electronic Fund Transfer Act by requiring consumers to sign up for a JPay debit card as a condition of receiving government benefits.

Earlier this month, Missouri awarded a $45.7 million, five-year contract to Aramark to provide food service to the state’s 20 state-operated prisons.

It might have checked in with Michigan first.

In 2015, the state ditched its three-year prison food contract with Aramark 18 months early after the Detroit Free Press uncovered a litany of problems, including meal shortages, maggots in the kitchen, and Aramark employees smuggling drugs into the facilities and engaging with sex acts with prisoners.

“The definition of insanity is doing the same thing over and over again and then expecting a different result,” said American Federation of State County and Municipal Employee’s (AFSCME) Ed McNeil at the time. “This is a different company, but we will get the same result–poor service for the money state taxpayers are spending.”

In fact, Michigane contracted Trinity Services Group. Less than two years later, Michigan levied $2 million against Trinity for inadequate staffing levels and other problems, including many of the same violations as Aramark.

Over half of U.S. jailed surveyed by Reuters report they had contracted with private companies for inmate healthcare. It found that, on balance, “death rates are higher when healthcare is in the hands of private industry.” A November 2022 report from The Private Equity Stakeholder Project outlined a raft of problems with H.I.G. Capital, one of the largest healthcare companies serving U.S. prisons and jails, including facilities “characterized by poor intake and screening; difficulty accessing care; and inconsistent medication management practices.” It also pointed out inadequate staffing that contributing to concerns about access to care, including to psychiatric staff.

Private corrections companies say that they can “do it cheaper” but the higher profits for the contractors who score these lucrative contracts have come at a great cost to the incarcerated—worse conditions and care, and price gouging of vulnerable families. Those dollars would be better spent on adequate staffing, additional health and mental health services, better communication opportunities between the incarcerated and their families, and educational programs. That would turn “cheaper” into “better.”


Image credit: The Marshall Project, from the article What’s In a Prison Meal?

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