The term prison privatization commonly refers to the policy of contracting out the management and operation of prisons and jails to private, for-profit companies. Prison privatization is a controversial public policy issue, with ongoing debate over the ethics of delegating the punishment function of the criminal justice system to private actors, whether private prisons cost less to operate than public facilities, and if the quality of security and conditions of confinement differ between public and private prisons. In 2005, approximately 200 private correctional facilities operated in the United States, housing a total of 107,000 inmates. Four companies—Corrections Corporation of America, Geo Group, Management and Training Corporation, and Cornell Corrections—provide more than 90 percent of private prison capacity. About 6 percent of all state inmates and 14 percent of federal inmates are incarcerated in privatized facilities.
The idea of privatizing prisons emerged in the 1980s as a policy remedy to the problem of growing incarceration rates, severe prison overcrowding, and constraints on increasing government funding of new prison space. Public investment in new prisons climbed eightfold from the late 1970s to the early 1990s, but was at or approaching its limits in many jurisdictions due to voter rejection of construction bonds, statutory ceilings on state debt, or general taxpayer unwillingness to support increases in government spending. With privatization used as a way of reducing costs and increasing capacity in other areas of government services—such as public works and infrastructure (e.g., utilities, building maintenance, and highway construction) and social policy (e.g., health care, pension plan management, and welfare services)—supporters of prison privatization argued that the benefits of privatization in those areas could apply to prisons as well. Private companies could build new prisons more rapidly than the government and draw upon private investors to help fund prison construction, while competition for contracts would help to contain costs and promote more efficiency in operations. On the strength of these arguments, the first private prison opened in 1984. Within the next 20 years, private correctional facilities arose in 33 states.
On the other side of the debate, critics of prison privatization argue that the profit motive of private companies encourages them to cut corners, resulting in diminished conditions of confinement for inmates, a risk to public safety, and more dangerous environments for both prison inmates and staff. Correctional worker labor unions are among the most vocal of private prison critics, with their opposition based in part on the fact that the wages of correctional officers in private prisons are generally lower than in public prisons. Correctional officer unions have organized campaigns to defeat prison privatization attempts in many jurisdictions. Reflective of their efforts, the number of private prisons around the country correlates inversely with labor unions’ strength: 47.5 percent of private prison beds are in southern states, 25.1 percent in western states, 17.7 percent in Midwestern states, and 9.7 percent in northeastern states. Since the late 1990s, a number of faith-based organizations have also voiced opposition to prison privatization on ethical grounds, arguing that the business ethos of economy and efficiency is an insufficient rationale to drive policy in a criminal justice system founded on principles of justice and public service.
Research comparing the operating costs and conditions of confinement in public prisons and private prisons has produced mixed findings. Numerous studies, sponsored by state-level agencies, simply investigated whether states could save money by privatizing some of their prisons. While the studies generally indicate that private prisons are less expensive—by 8 to 15 percent—the true cost of operating either type of facility is difficult to ascertain due to substantially different procedures in private and public accounting. For example, the reported expenses of private facilities do not generally include indirect costs incurred by the government in providing services, such as contract monitoring and prisoner case management. Similarly, other state agencies may absorb some public prison costs (e.g., utilities, personnel management) that are not reflected in total correctional agency costs.
In noting the difficulty of making valid comparisons, the U.S. Government Accountability Office criticized the methodological validity of much privatization cost comparison research and concluded that the jury is still out on which type of prison is the more cost-effective. Other studies suggest that differences in facility size, age, and security level are more predictive of facility costs than private versus public ownership. Research on the quality of services provided by private prisons shows that, system-wide, private prisons generally provide a quality of inmate care on par with public facilities. Observance of low performance in individual private prisons appears to be more a result of poorly written contracts or inadequate contract monitoring than inherent differences between the public and private sectors.
The ethical issues surrounding prison privatization engage questions of values and beliefs not easily settled by empirical studies of costs and conditions. Supporters of prison privatization tend to place a high value on limited government and free market solutions to social problems. Conversely, opponents tend to place greater value on the role of government in solving social problems. Where supporters have been successful in implementing prison privatization policy, opponents have been successful in moderating the extent of the practice.
Prison privatization has served as an expedient remedy for prison overcrowding in times of rapid growth in the correctional population. As the growth in incarceration rates began to slow somewhat at the end of the 20th century, growth in the private prison industry slowed accordingly. Post-September 11, 2001, concerns with illegal immigration have provided a boost to the private prison industry, with the federal government entering into new contracts with private companies to create more detention centers for illegal aliens. But as the ethical issues remain intractable, the debate over prison privatization will likely continue for some time.
- Austin, James and Garry Coventry. 2001. Emerging Issues on Privatized Prisons. Washington, DC: U.S. Department of Justice, Bureau of Justice Assistance.
- Culp, Richard F. 2005. “The Rise and Stall of Prison Privatization: An Integration of Policy Analysis Perspectives.” Criminal Justice Policy Review 16(4):412-42.
- Government Accountability Office. 1996. Private and Public Prisons: Studies Comparing Operational Costs and/or Quality of Services. Washington, DC: U.S. Government Printing Office.
- Pratt, Travis C. and Jeff Maahs. 1999. “Are Private Prisons More Cost-Effective than Public Prisons? A Meta-Analysis of Evaluation Research Studies.” Crime & Delinquency 45(3):358-71.
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