Monday, November 28, 2005

More on Israel's Private Prison Plans

This terrific story in Haaretz is worth reading, even if you don't think you care about the crisis--humanitarian and financial--gathering as the result of the industrialization of incarceration. I discussed this issue briefly, here. Will Israel be the next of many countries to ensure that crime pays? Here's a telling bit:
During the 12 years that have elapsed since the establishment of the world's first private prison in the United States, a great deal of experience has accumulated, which mostly is not encouraging. About 30 countries have thus far established approximately 200 private prisons, in which more than 150,000 inmates are incarcerated. Most of the private prisons have been established in the United States, France, Britain and Australia, and a few of them in South American states and in Eastern Europe; and there is also one country - New Zealand - that has reversed its decision to privatize prisons.

In the U.S., however, private prisons have become a huge industry: About 14 percent of all federal prisoners and about 6 percent of the state prisoners are held in private prisons. The prison industry is already in second place, right after the high-tech industry, in the ranking of growth: The four leading companies, whose profits came to no less than $2.3 billion dollars in 2004, are growing at the rate of 5.9 percent annually.

As they grow stronger, so too does their public influence and thus their lobbying efforts with the aim of making criminal legislation and punishment policy more stringent. No wonder then that the number of prisoners in the United States, which a few years before the establishment of the first private prison stood at 280,000, has burgeoned since then to 2.13 million today. This monstrous number is higher than the number of prisoners in China, where the population is four times greater than that of the United States.

"Private prisons are not the only reason for this increase, but there is no doubt that their lobbying activity is one of the reasons for the increasing stringency of punishment and the increase in the number of prisoners," says attorney Aviv Wasserman, the head of the human rights division at the Academic College of Law in Ramat Gan, whose petition to the High Court of Justice against the decision to establish a private prison here is still pending.

Wasserman believes that here, too, we will see such lobbying campaigns in the future. "Even now there is talk about the need for toughness, but today they are discussing this with the participation of the Justice Ministry, the Israel Bar Association, academia and the human rights organizations," he says. "From now on there will also be participation in these discussions, for example in the Knesset House Committee, of Lev Leviev's representatives, who will want to increase the number of prisoners. This is a new player who has interests that are worth billions of shekels and will come with the best lawyers and public relations people. His weight could prove crucial."


troutsky said...

Would you be uncomfortable if you saw that the mutual funds or pension funds or 401K you owned were invested in prisons?

barba de chiva said...

In a word, yes (and you've sent me, with the question, scrambling to find out where the my only pension fund, the Texas Teacher Retirement System is investing). It gets more creepily ironic, of course: even as businesses like these generate more and more income for investors, they're contributing to an increasingly precarious heath-care crisis over the long term, as our huge prison population ages behind bars. The looming costs of this (detailed by Alan Elsner in his book "Gates of Injustice") threaten to obviate our savings anyway. I know that sounds alarmist; but I think it's worth being alarmed about.

Some companies, of course, like Emerald Correctional Management, are privately held. The problem there is that they've found ways of getting local governments to float high-yield, taxable, junk bonds to construct facilities that local government will have the honor of "owning" in 25 or so years. It's a brilliant plan, whereby risk is doled out to investors (and I hope not too many pension plans are buying these kinds of bonds!) and local governments. Emerald just operates the facility for as long as it benefits them to do so.

It's a very big mess, at this point.