How do profitable prisons make money

USA and private prisons: the lucrative business with jail

According to the prosecutor, private providers were included in the judiciary around ten years ago because the state institutions were overcrowded. In 2013, the number of inmates there was 30,000, but has since declined. In an internal memorandum linked to the Washington Post, Yates writes: “Private prisons played an important role in a difficult period, but over time they have shown that they do worse than government institutions. They simply do not provide the same level of service, programs, and resources in the prison system; they also do not bring any significant cost savings. "

More importantly, "They do not provide the same level of security." It has been difficult to outsource education programs to private institutions - but these programs are important to avoid relapses among released prisoners, the document says. Yates therefore wants to let existing contracts expire and ultimately get rid of the private prisons completely. She also names a few examples in which this concept is already being implemented.

As a result of this announcement, private prison operators' share prices plummeted. Corrections Corporation of America's stocks slipped 35 percent. Founded in 1983, the company is the largest private prison operator in the United States with over 60 facilities and 90,000 beds. In the first half of 2015, the company had sales of $ 911 million and after-tax profit of $ 104 million.

In the past, however, there have always been problems and scandals in the company's prisons. In 2012, an employee died in a prisoner revolt in Natchez, Mississippi, injuring 19 people. In 2015, rioting at a facility in Cushing, Oklahoma, killed four inmates and hospitalized four more.

Private prisons are big business in the United States. According to the US prison authorities, 13 federal detention centers are currently operated by private companies. Mainly foreign prisoners who are expelled after their imprisonment are held there.