Thread: Private Prison Company to Demand 90% Occupancy

Private prisons in the U.S.
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Greasing the Wheels of Power to Keep Jails Full

To be profitable, private prison firms must ensure that prisons are not only built but also filled. Industry experts say a 90-95 per cent capacity rate is needed to guarantee the hefty rates of return needed to lure investors. Prudential Securities issued a wildly bullish report on CCA a few years ago but cautioned, "It takes time to bring inmate population levels up to where they cover costs. Low occupancy is a drag on profits." Still, said the report, company earnings would be strong if CCA succeeded in ramp(ing) up population levels in its new facilities at an acceptable rate".
"(There is a) basic philosophical problem when you begin turning over administration of prisons to people who have an interest in keeping people locked up" notes Jenni Gainsborough of the ACLU's National Prison Project.
Private prison companies have also begun to push, even if discreetly, for the type of get-tough policies needed to ensure their continued growth. All the major firms in the field have hired big-time lobbyists. When it was seeking a contract to run a halfway house in New York City, Esmor hired a onetime aide to State Representative Edolphus Towns to lobby on its behalf. The aide succeeded in winning the contract and also the vote of his former boss, who had been an opponent of the project. In 1995, Wackenhut Chairman Tim Cole testified before the Senate Judiciary Committee to urge support for amendments to the Violent Crime Control Act -- which subsequently passed -- that authorized the expenditure of $10 billion to construct and repair state prisons.
CCA has been especially adept at expansion via political payoffs. The first prison the company managed was the Silverdale Workhouse in Hamilton County, Tennessee. After commissioner Bob Long voted to accept CCA's bid for the project, the company awarded Long's pest control firm a lucrative contract. When Long decided the time was right to quit public life, CCA hired him to lobby on its behalf. CCA has been a major financial supporter of Lamar Alexander, the former Tennessee governor and failed presidential candidate. In one of a number of sweetheart deals, Lamar's wife, Honey Alexander, made more than $130,000 on a $5,000 investment in CCA. Tennessee Governor Ned McWherter is another CCA stockholder and is quoted in the company's 1995 annual report as saying that "the federal government would be well served to privatize all of their corrections."
In another ominous development, the revolving door between the public and private sector has led to the type of company boards that are typical of those found in the military-industrial complex. CCA co-founders were T. Don Hutto, an ex-corrections commissioner in Virginia, and Tom Beasley, a former chairman of the Tennessee Republican Party. A top company official is Michael Quinlan, once director of the Federal Bureau of Prisons. The board of Wackenhut is graced by a former Marine Corps commander, two retired Air Force generals and a former under secretary of the Air Force, as well as James Thompson, ex-governer of Illinois, Stuart Gerson, a former assistant US attorney general and Richard Staley, who previously worked with the INS. CorpWatch*:*US: America's Private Gulag

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File:US incarceration timeline-clean.svg - Wikipedia, the free encyclopedia

Private Prisons: A Reliable American Growth Industry
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CXW - Corrections Corporation of America Stock Research - Stock ...
Research Corrections Corporation of America with InvestorGuide.com stock research tool. CXW quotes, charts, earnings, profiles, news, analysis, financials, ...
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Corrections Corporation of America is the nation's largest owner and operator of privatized correctional and detention facilities and one of the largest prison operators in the United States, behind only the federal government and three states. CXW currently operates 65 facilities, including 44 company-owned facilities, with a total design capacity of approximately 87,000 beds in 19 states and the District of Columbia.
Bill Ackman likes Corrections Corporation of America (CXW)

Judges in PA take bribes from private prisons | media island ...

Feb 19, 2009 ... No charges have been filed against the private prisons that paid the bribes. Pennsylvania's Supreme Court has appointed an outside judge to ...
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Government's Management of Private Prisons -
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NETWORK... EXPOSE THIS CORRUPTION!!!

Company Focus
3 prison stocks poised to break out
Thanks in part to overcrowding, governments are turning to private companies to build and manage prisons. Here's how to pick the right time to buy into the trend.

In what might be a revealing commentary on our country's state of affairs, the nation's private prison companies look like solid investments for the next several years.

The three big prison companies -- Corrections Corp. of America (CXW, news, msgs), The Geo Group (GGI, news, msgs) and even the troubled Cornell Cos. (CRN, news, msgs) -- have decent growth prospects for the following reasons.
Increased border patrols. The Intelligence Reform and Terrorism Prevention Act of 2004, signed by the president in December, calls for stepped up border patrols to improve domestic security. This makes it likely that more illegal immigrants will be caught. Lawmakers estimate that by 2010 the Bureau of Immigration and Customs Enforcement (ICE) will need another 40,000 prison "beds," as they say in the business.

Governments are hard up for cash. "Because of tight budgets, there has not been a lot of new prison construction," says Irving Lingo, Corrections Corp. of America's finance chief.

Instead, state and federal prison systems turn to private companies that build and manage prisons. In the 2005 federal budget, for example, Congress cut prison construction spending by 48%, says Patrick Swindle, an analyst who covers the sector for the brokerage Avondale Partners. Government prison systems turn to the private sector in part because costs are 10% to 15% lower. Start investing with $100.

Government prisons are overcrowded and the prison population will keep growing. "Federal prisons are at 33% overcapacity, and more than half the states are at overcapacity," says Swindle. "There is a scarcity of beds, and companies in the private prison space are being asked to meet the demand."

Demand should pick up over the next decade for a simple demographic reason. The children of baby boomers, the so-called echo boom, are about to enter the 18- to 24-year old age group -- the years when people commit the most crimes. The Federal Bureau of Prisons estimates it will have a 36,000 bed shortfall by 2010, partly due to this trend.

The big-fish theory
These numbers may not seem like much. But it's a big deal for the tiny private prison sector, which houses only around 7% of the 2.1 million people in prison in the United States.

To see why, let's take a closer look at some numbers. The two federal agencies, ICE and FBP, will need 76,000 new prison slots over the next five years. That alone is more than the number of beds now run by the biggest private prison company, Corrections Corp., which houses about 70,000 inmates. And it doesn't even include increases in demand expected at the state level. More: Latest business news: Financial, stock & investing news online - MSN Money


Private Prison Companies Have a Lock on the Business

For a land of the free, the U.S. has a lot of prisoners: Over the past 25 years, our inmate population has swelled to 2.38 million, from roughly 700,000. Our incarceration rate is the highest in the world, and our federal prisons are at 137% of their capacity.

This should be good news for the private prisons that absorb the spillover from congested federal and state penitentiaries. But, alas, the recession has ruffled the economics of even law and order. Cash-strapped states are mulling measures, such as quicker paroles and earlier releases.


As a result, private-prison stocks are selling at unusual -- and untenable -- discounts to their historical multiples or value. The three biggest companies are Corrections Corp. of America, which controls 39% of private-prison beds, Geo Group, which runs 25%, and Cornell, with 10%. While their stocks have rebounded recently, they still trade at 12 to 18 times what each is expected to earn in 2010 -- compared with multiples pushing 30 before the financial crisis.
These grim valuations overlook private prisons' steady profitability, their stranglehold on a tough-to-penetrate industry and the chasm between supply and demand. Barclays analyst Manav Patnaik pegs the annual demand for new prison beds at 35,000, and the supply at just 20,000 public and private beds.

Today, budget-constrained states can ill afford the time or capital to build new facilities. And many increasingly find it cheaper to outsource part of their prison system. That explains why half the new inmates over the past year were sent to private prisons, even though less than 9% of U.S. prison beds are privatized.

Any reform that shortens sentences will hurt private prisons. But bulls say that the stocks may have already factored in much of the threat.
Case in point: Colorado wants to cut its prison population by 26%, or 6,000 inmates, over the next two years. But Signal Hill analyst T.C. Robillard doubts the state "can classify a quarter of its inmates as low-risk or near the end of their sentences." Mr. Patnaik pegs the net impact at just 1,000 beds, noting that releases will be offset by new intake.

Besides, private prisons earn steadily recurring revenue, impervious to seasons or business cycles. Customers don't defect easily to competitors. And the facilities tend to be durable, low-maintenance and quite immune to changing architectural whims. Private Prison Companies Have a Lock on the Business - WSJ.com


Private Prisons

Convicted killers from other states - locked up in private prisons here - with almost no state oversight. News Video: http://www.kpho.com/local-video/inde...ideoid:4325449}





Privatized Prisons and the Capitalist Drug Syndicate

Wed Aug 25, 2010 10:10

Privatized Prisons and the Capitalist Drug Syndicate

What's the connection between privatized prisons and the global drug syndicate? ... The focus of the drug war in the United States has shifted significantly ...
Privatized Prisons and the Capitalist Drug Syndicate

Videos for Private Prisons + Drug War

“We’ve spent a trillion dollars prosecuting the war on drugs,” Norm Stamper, a former police chief of Seattle, told me. “What do we have to show for it? Drugs are more readily available, at lower prices and higher levels of potency. It’s a dismal failure.”

For that reason, he favors legalization of drugs, perhaps by the equivalent of state liquor stores or registered pharmacists. Other experts favor keeping drug production and sales illegal but decriminalizing possession, as some foreign countries have done.

Here in the United States, four decades of drug war have had three consequences:

First, we have vastly increased the proportion of our population in prisons. The United States now incarcerates people at a rate nearly five times the world average. In part, that’s because the number of people in prison for drug offenses rose roughly from 41,000 in 1980 to 500,000 today. Until the war on drugs, our incarceration rate was roughly the same as that of other countries.

Second, we have empowered criminals at home and terrorists abroad. One reason many prominent economists have favored easing drug laws is that interdiction raises prices, which increases profit margins for everyone, from the Latin drug cartels to the Taliban. Former presidents of Mexico, Brazil and Colombia this year jointly implored the United States to adopt a new approach to narcotics, based on the public health campaign against tobacco.

Third, we have squandered resources. Jeffrey Miron, a Harvard economist, found that federal, state and local governments spend $44.1 billion annually enforcing drug prohibitions. We spend seven times as much on drug interdiction, policing and imprisonment as on treatment. (Of people with drug problems in state prisons, only 14 percent get treatment.)

I’ve seen lives destroyed by drugs, and many neighbors in my hometown of Yamhill, Oregon, have had their lives ripped apart by crystal meth. Yet I find people like Mr. Stamper persuasive when they argue that if our aim is to reduce the influence of harmful drugs, we can do better.

Mr. Stamper is active in Law Enforcement Against Prohibition, or LEAP, an organization of police officers, prosecutors, judges and citizens who favor a dramatic liberalization of American drug laws. He said he gradually became disillusioned with the drug war, beginning in 1967 when he was a young beat officer in San Diego.

“I had arrested a 19-year-old, in his own home, for possession of marijuana,” he recalled. “I literally broke down the door, on the basis of probable cause. I took him to jail on a felony charge.” The arrest and related paperwork took several hours, and Mr. Stamper suddenly had an “aha!” moment: “I could be doing real police work.”

It’s now broadly acknowledged that the drug war approach has failed. President Obama’s new drug czar, Gil Kerlikowske, told the Wall Street Journal that he wants to banish the war on drugs phraseology, while shifting more toward treatment over imprisonment.

The stakes are huge, the uncertainties great, and there’s a genuine risk that liberalizing drug laws might lead to an increase in use and in addiction. But the evidence suggests that such a risk is small. After all, cocaine was used at only one-fifth of current levels when it was legal in the United States before 1914. And those states that have decriminalized marijuana possession have not seen surging consumption.

“I don’t see any big downside to marijuana decriminalization,” said Peter Reuter, a professor of criminology at the University of Maryland who has been skeptical of some of the arguments of the legalization camp. At most, he said, there would be only a modest increase in usage.

Moving forward, we need to be less ideological and more empirical in figuring out what works in combating America’s drug problem. One approach would be for a state or two to experiment with legalization of marijuana, allowing it to be sold by licensed pharmacists, while measuring the impact on usage and crime.

I’m not the only one who is rethinking these issues. Senator Jim Webb of Virginia has sponsored legislation to create a presidential commission to examine various elements of the criminal justice system, including drug policy. So far 28 senators have co-sponsored the legislation, and Mr. Webb says that Mr. Obama has been supportive of the idea as well.

“Our nation’s broken drug policies are just one reason why we must re-examine the entire criminal justice system,” Mr. Webb says. That’s a brave position for a politician, and it’s the kind of leadership that we need as we grope toward a more effective strategy against narcotics in America.

Read More: Arizona Politics , Law Enforcement Against Prohibition , Marijuana , Mexico , Murder , Richard Nixon , Walter Cronkite , War On Drugs , Politics News

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Guest: Marc J Victor, John Buttrick, Scott Victor, Jerry Schreck

Subject: Guest Hosts For Charles Goyette, Criminal Justice System, Superior Court Judge, Freedom, Jury Nulification, Fully Informed Jury

* Listen to the MP3 Audio - Segment 1 (9.52 MB)
Victim Rights discussed....
http://www.apfn.org/audio/2005-12-27-Charles-01.mp3

* Listen to the MP3 Audio - Segment 2 (9.41 MB)
John Buttrick - Superior Court Judge in Maricopa County, Arizona.
http://www.apfn.org/audio/2005-12-27-Charles-02.mp3

* Listen to the MP3 Audio - Segment 3 (9.53 MB)
John Buttrick - Superior Court Judge in Maricopa County, Arizona.
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American Jury Institute/Fully Informed Jury Association: Home

A non-profit educational association whose mission is to inform all Americans about their rights, powers and responsibilities when serving as trial jurors
http://www.apfn.org/apfn/judge.htm

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"THE LAW"
http://www.apfn.org/apfn/thelaw.htm

The Prison Industrial Complex: Crisis and Control
CorpWatch*:*The Prison Industrial Complex: Crisis and Control

Private Prisons in the United States, 1999:
An Assessment of Growth, Performance, Custody
http://www.apfn.org/pdf/oreprcg2000.pdf

Corrections Corporation of America (CCA)
Commentators and human rights activists have raised concerns about the morality imprisoning humans for profit. Traded on the New York Stock Exchange, investors have an interest in keeping private prisons filled. Industry experts say a profitable prison must have a 90-95 percent capacity rate. In a 1990's report, Prudential Securities was bullish on CCA but noted, "It takes time to bring inmate population levels up to where they cover costs. Low occupancy is a drag on profits... company earnings would be strong if CCA succeeded in ramp(ing) up population levels in its new facilities at an acceptable rate"
Corrections Corporation of America - Wikipedia, the free encyclopedia

"WACKENHUT" AND "XE"
As you read on, one company has over 700 government contracts out of just over 900 security contracts available of which most are “Non-Bidding”. Talk about competition being alive and well. Their histories are made for the wide screen. Corruption, fraud, deceit, personal data collection, graft and even unproven but connected murder. What is scary is the fact these corporations are world wide in their business’s and therefore out of the jurisdiction of American influence and laws in some instances.
Xe: ( previously Blackwater Worldwide.)
More here: "Wackenhut" and "Xe" | Warren Adie-Riley | Blog Post | Red Room

US: America's Private Gulag
CorpWatch*:*US: America's Private Gulag
snip) In addition, private prisons have substantially greater market accountability because they are concerned with winning new contracts and renewing old ones, and with avoiding both adverse publicity and drops in stock price.

2. Private Prisons� Market Accountability. � Market mechanisms, such as governments� ability to rescind or decline to renew private firms� contracts, and more generally, the potential for bad publicity to cause a drop in firms� stock prices, further increase private prison companies� accountability

b) Adverse Stock Price Effects. � Private corporations are sensitive to drops in their stock prices.� Contract rescission, as well as the possibility of lawsuits with high damage awards, affects profitability, and perceptions of a company�s profitability are reflected in the price of its stock.� Thus, a private corporation is punished financially for bad news, and possibly for mismanagement that may impose costs in the future.� For example, the INS detention center in Elizabeth, New Jersey, run by Esmor Corrections, erupted in a massive riot in 1994 because the company had continuously cut corners on food and facility upkeep.� Esmor�s stock price dropped from $20 a share to $7 after news of the riot became known.[109] snip)

More: Alexander "Sasha" Volokh -- Harvard Law Review note on private prisons

Larger Inmate Population Is Boon to Private Prisons
Larger Inmate Population Is Boon to Private Prisons - WSJ.com

Corrections Corporation of America
http://www.marketwire.com/press-rele...XW-1031225.htm

NOW on PBS Video
Prisons for Profit
Prisons for Profit . NOW on PBS

One in 28 US kids has a parent in prison: study
One in 28 US kids has a parent in prison: study | The Raw Story

Operation: 'Fast and Furious' Gun Running
Operation: "Fast and Furious"
Gun Running (includes ATF, FBI, DEA, IRS & ICE)
Operation: Fast and Furious, Gun Running


MP3-LISTEN: END THE ENERGY CRISIS!
BY HUGH DOWNS ABC NEWS
http://www.apfn.org/audio/downshemp395.mp3

C.A.P.P. News
Citizens Against Private Prisons
Citizens Against Private Prisons - Home

Resolution calling for abolition of For-Profit Private prisons
by Presbyerian Church (USA)
http://oga.pcusa.org/publications/private-prisons.pdf

private prisons and conflicts of interests
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Related: http://www.alipac.us/f19/u-s-prisone...s-hour-219886/

Related: http://www.alipac.us/f19/30-signs-us...prison-245435/

Related: http://www.alipac.us/f19/army-recrui...-armor-220344/

Related: http://www.alipac.us/f19/obama-admin...agenda-259951/

Factory owners: Federal prisoners stealing our business

By Emily Jane Fox @CNNMoney
August 14, 2012: 11:34 AM ET


American Apparel Inc., which manufactures Army uniforms in Alabama, has laid off 150 workers as a result of going head-to-head with Unicor for government contracts.

NEW YORK (CNNMoney) -- Just hearing the word Unicor is enough to make Kurt Wilson see red.

Unicor is a government-run enterprise that employs over 13,000 inmates -- at wages as low as 23 cents an hour -- to make goods for the Pentagon and other federal agencies.

With some exceptions, Unicor gets first dibs on federal contracts over private companies as long as its bid is comparable in price, quantity and delivery. In other words: If Unicor wants a contract, it gets it.

And that makes Wilson and other small business owners angry.

Wilson has been competing with Unicor for 20 years. He's an executive at American Apparel Inc., an Alabama company that makes military uniforms. (It is not affiliated with the international retailer of the same name.) He has gone head-to-head with Unicor on just about every product his company makes -- and said he has laid off 150 people over the years as a result.

"We pay employees $9 on average," Wilson said. "They get full medical insurance, 401(k) plans and paid vacation. Yet we're competing against a federal program that doesn't pay any of that."

Unicor, also known as Federal Prison Industries, is part of the U.S. Bureau of Prisons. It has been preparing inmates for jobs after they get out since 1934.

The program has 83 factories and makes goods in seven industries -- apparel being the biggest ticket. Unicor made over $900 million in revenue last year and faces more heat from businesses and lawmakers as the economy takes a toll on small manufacturers.

Related: Can the U.S. handle a manufacturing comeback?

In Olive Hill, Ky., apparel factory Ashland Sales and Service, Co. has been making windbreakers for the Air Force for 14 years, says Michael Mansh, who runs the factory. Last February, when he learned that Unicor was eyeing the contract, he reached out to Kentucky Sen. Mitch McConnell.
McConnell, one of the top Republicans on Capitol Hill, issued a public statement urging Unicor to back off. The next day, it did.

With 100 employees, Mansh said Ashland is Olive Hill's largest employer. And he said losing the Air Force contract would have shut the factory down.

"That's 100 people buying groceries. We use trucking companies in the town, buy parts and light bulbs there every day," he said. "That's all lost when prisons take away contracts."

Unicor is not required to pay its workers minimum wage and instead pays inmates 23 cents to $1.15 an hour. It doesn't have health insurance costs. It also doesn't shell out federal, state or local taxes.

Related: Fiscal cliff threatens small businesses

Advocates for private sector companies are loudly campaigning for reform of Unicor's preferential status.

Unemployment has been over 8% for nearly four years "and there's a federal program tanking our industry," said Kurt Courtney, director of government relations at the American Apparel and Footwear Association. "The only way for workers to get jobs back is to go to prison. There's got to be a better way to do this."

In 2008, Congress amended the law to limit Unicor's advantage for certain kinds of Pentagon contracts. Now a bill in the House supported by 28 lawmakers from both parties would go further and require Unicor to compete across the board. The bill also provides alternative ways for training inmates, who would instead work for charities, religious organizations, local governments or school districts.

"We know that in the recovery, many new jobs are coming out of small businesses," said Rep. Bill Huizenga, a Michigan Republican who introduced the bill. "It makes no sense to strangle them in the cradle."

Huizenga expects a similar bill to be introduced in the Senate in the coming months.

Unicor doesn't agree with the criticism. According to spokeswoman Julie Rozier, inmates working for Unicor are 24% less likely to reoffend and 14% more likely to be employed long-term upon release. She also noted that over 40% of Unicor's supplies were purchased from small businesses in 2011.

She cited the unique costs associated with operating within a prison. For example, Unicor employs more supervisors than a private sector firm would, and security lockdowns disrupt production.

Businesses aren't buying it. John Palatiello, president of the Business Coalition for Fair Competition, said his organization of businesses and taxpayer groups is sympathetic to Unicor's goals. But they shouldn't be accomplished at the expense of small businesses.

"Who is being punished here?" he said. "The inmates who have committed a crime against society, or the employees of private companies who play by the rules?"
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Factory owners: Federal prisoners stealing our business - Aug. 14, 2012

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