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In recent decades, the incarceration rate in the United States has skyrocketed, presenting severe fiscal challenges to local governments, states, and the Federal Government.1 In less than four decades, inmate populations have increased tenfold, from under 200,000 in 1971 to over 2 million in 2008.2 The result—overcrowded prisons and jails—generates numerous humanitarian, social, and legal problems which are equally, if not more severe, than the concomitant budgetary challenges.3 Many financially strained governments have found it necessary to adopt innovative corrections policies to reduce the cost of prison administration. The cornerstone of these efforts has been an increased dependency on contracts with private entities for correctional and rehabilitative services.4

Currently, the Federal Government and most states authorize corrections privatization in some form.5 Private prison contracts are intended to alleviate prison overcrowding and reduce corrections expenditures while bypassing the need for bonds, increased taxes, or funding referenda.6 However, experience has shown that “the number of jailed criminals typically rises to fill whatever space is available,”7 and privatization has so far failed to temper prison crowding. Instead, the consistent demand for new prisons and jails has facilitated an in governmental spending, and corrections budgets continue to swell along with the prison crease in population.8

Aside from its nonsuccess in improving crowded prison conditions, the privatization “remedy” has created additional financial, legal, and moral problems. The first of these problems relates to legitimacy.9 When a private company assumes responsibility for the administration of inmate punishment and rehabilitation, it improperly undertakes to perform an inherently public discretionary function at the expense of inmates’ fundamental liberty interests.10 Another problem stems from what private prison advocates claim to be privatization’s greatest virtue: the free market model. Private prison companies and their supporters claim that competition and market forces promote greater corrections service performance at a comparatively low cost and that this benefit accrues to contracting governments.11 However, these purported benefits are often imperceptible and where they are evident they fail to justify the humanitarian and social problems that arise under privatization schemes.

Privatization overall negatively impacts the treatment, rehabilitation, and care of prisoners, indicating that the market-driven business model is fundamentally incompatible with an effective and humane corrections system.12 There are several reasons for this tension. First, private prison companies are primarily profit-seeking entities, working to reduce costs wherever possible. Cost-cutting measures promote inferior contract performance, undue safety risks, and poor delivery of inmate services.13 The profit motive also encourages private prison companies to disregard the principles of inmate rehabilitation and criminal deterrence; if advanced, these principles would undermine profits and reduce the demand for these companies’ services.14 Finally, to expand their markets, private prison operators are exhorted to advance harsh criminal sentencing policies and to dilute early-release, parole, and good-behavior programs within their facilities.15 All of these market-based incentives, as applied to the field of corrections, operate to the detriment of the Government, prison inmates, and society as a whole.16

In Illinois and New York, legislators have rightfully abolished private prison contracts.17 This Note will detail why the Federal Government and all other states should follow suit and avoid further abdications of prison administration responsibilities for the sake of short-term financial savings. Part II will discuss the history and development of private prisons in the United States, accounting for the recent surge in incarceration rates and the impetus behind the modern privatization trend. Part III will argue that prison privatization improperly and illegally encroaches on inherently governmental functions, and that it is fundamentally incompatible with the goals of an effective and humane penal system. Part IV will recount and analyze various problems unique to private prisons, concluding that these problems far outweigh the purported benefits associated with outsourcing. Finally, Part V will address the measures New York and Illinois have adopted to avoid the problems associated with private prisons. It also will discount contract modification as a viable alternative solution. This Part will conclude that the Federal Government and those states that continue to outsource prison administration must reclaim their inherently governmental responsibilities and enact legislation prohibiting all private prison administration contracts.


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