Who Are The Cronies Part III: Prisons

prison

Kris Morgan 2/14/2018

In parts one and two of this series we dealt with the military-industrial complex and the banking industry. The issue regarding prisons is a little less well-known, but is even more unjust than the others. Nothing is less libertarian than taking freedom from a person who has not violated another’s rights. Sadly, the United States holds 25% of the world’s prisoners despite carrying only 5% of the total world population. Perhaps by examining the beneficiaries of these conditions we can shed some light on how the ‘land of the free’ has come to this.

Corrections Corporation of America (CCA) is the fifth largest corrections organization in the country, behind the Federal Government and three states. According to their site they “specialize in the design, construction, expansion and management of prisons, jails and detention facilities, along with residential reentry services, as well as inmate transportation services through its subsidiary company TransCor America.”
Damon T. Hininger, CCA CEO and President

hininger

Hininger joined the company in 1992. He has had Vice President and Business Analysis positions as well as working in Federal and Local customer relations. According to salary.com his base pay is over $861,000 and over $2mil in stock value, and over $3mil total compensation.

 

GEO Group (previously Wackenhut) is another large prison company. Shamelessly, they very enthusiastically advertise their relation with the government on their page. “GEO’s U.S. Corrections and Detention division oversees the operation and management of approximately 75,500 beds in 71 correctional and detention facilities. GEO’s U.S. Corrections & Detention division provides services on behalf of the Federal Bureau of Prisons, U.S. Marshals Service, and U.S. Immigration and Customs Enforcement, as well as 9 state correctional clients and various county and city jurisdictions.”

George C. Zoley, CEO, Chairman of the Board, and Founder

zoley

Bloomberg ran a summary of Zoley. “Mr. Zoley founded GEO Care Inc., a wholly-owned subsidiary of The GEO Group, Inc. in 1984 and serves as its Chairman and Chief Executive Officer. He serves as Chief Executive Officer and Vice Chairman of Wackenhut Corrections of The Wackenhut Corporation. He served as the President Geo of Group Inc. since 1988.” According to the article he made $5,176,221 last year.

While managing and operating prisons has made plenty people rich, Attn.com points out money is also made providing inmate services. Ashley Nicole Black displayed her understanding of the economics involved when she wrote of the phone call service. “Few companies hold a virtual monopoly on the service and even pay the state a profit based commission. Remember, it’s the state that hires these companies. When the state is making money off these phone calls, do you think they are really interested in negotiating a fair, cost-effective phone plan for their prisoners?”

The following are examples of companies which make profit from offering services to inmates at what essentially amounts to monopoly prices.

 

Steve Rector, Corizon CEO

rector

According to their website, “as the correctional healthcare pioneer and leader for 40 years, Corizon Health provides client partners with high quality healthcare and reentry services that will improve health and safety of our patients…” In January 2018, the Kansas City Star reported Corizon had $2bn in contracts with Missouri and Kansas alone. Mr. Rector’s compensation information was unavailable.

 

Finally, we come to Global Tel-Link. According to their own site, GTL “serves approximately 2,300 facilities and 1.8 million inmates in 50 states, the District of Columbia and Puerto Rico. Our products and services are deployed in 32 state DOC contracts (including 8 of the largest 10) and over 650 counties, including many of the largest city/county run jail facilities. We also provide service to the Federal Bureau of Prisons.”

Brian D. Oliver, Global Tel-Link CEO

Oliver

Per Bloomberg, “Mr. Oliver was responsible for leading Global Tel*Link Corporation’s due diligence review with respect to new potential investments in the telecommunications and related sectors and overseeing portfolio companies once investments have been completed in those sectors. Mr. Oliver joined GTL from Gores Technology Group, LLC…” Compensation information was not available.

One can argue that these services are necessary, and the market is merely providing services, even to those in jail. However, it is clear the income generated by providing these services is stimulated by government created demand for them. Attn reminds us “the War on Drugs has also created ballooning prison populations by increasing arrests for petty offenses (such as marijuana possession). America has the longest first time drug offense sentences (5-10 years) of developed nations. …65 percent of private prison contracts require an occupancy guarantee. That means states must have a certain amount of prisoners — typically between 80 and 90 percent of occupancy — or pay companies for empty beds. Talk about bad incentives — a state throws money away if it does not have enough prisoners.” There are a lot of people with a lot of money riding on maintaining or increasing prison populations in the US and abroad.

To drive the point home, the Washington Post reported in 2015 that “several reports have documented instances when private-prison companies have indirectly supported policies that put more Americans and immigrants behind bars – such as California’s three-strikes rule and Arizona’s highly controversial anti-illegal immigration law – by donating to politicians who support them.”

Marco Rubio can be viewed as a case-study of how the relationship between prisons and politicians works. “While Rubio was leading the House, GEO was awarded a state government contract for a $110 million prison soon after Rubio hired an economic consultant who had been a trustee for a GEO real estate trust. Over his career, Rubio has received nearly $40,000 in campaign donations from GEO, making him the Senate’s top career recipient of contributions from the company.”  

The economic incentives surrounding the prison sector have clear and harsh consequences for the rest of us. The people we are supposed to trust with our security have taken that trust and twisted it into building a system which profits from our imprisonment. No private persons would ever be capable of such crimes against humanity without politics to support it. Our goal should be to reverse these trends in their tracks.

 

Part I                                                             Part II                                                         Part IV

 

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The author’s views and opinions expressed herein do not necessarily reflect those of the entire Ask A Libertarian Team or its followers.

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