Ending Private Prisons: Federal Decision a Small Step in the Right Direction

by Rick Zarrella

Last month, on August 11, 2016, the Inspector General’s Office of the U. S. Department of Justice released a damning report on private contract prisons. The report, titled “Review of the Federal Bureau of Prisons’ Monitoring of Contract Prisons” laid out the findings of a systematic review of the operation of private facilities contracted through the Justice Department’s Bureau of Prisons. The review found that “in most key areas, contract prisons incurred more safety and security incidents per capita” than federal prisons. The review also found that a number of the private prisons visited as part of the investigation had been cited for specific deficiencies or inappropriate practices, such as improperly placing new prisoners in restrictive “Special Housing Units” (also called “Secure Housing Units” or “solitary confinement” due to prisoners being locked in an isolation cell with minimal interaction) and lack of proper storage of use-of-force video records.

One week later, on August 18th, Deputy U.S. Attorney General Sally Yates released a memo laying out additional claims that private prisons “do not save substantially on costs” or “provide the same level of correctional services, programs, and resources” to inmates. She then states that the Department of Justice will begin “the process of reducing – and ultimately ending” the Bureau of Prisons’s use of private prisons.

These moves by administration officials came against a backdrop of civil rights and criminal justice reform advocates highlighting incidents of abuse and neglect in private prisons across the country in recent years beyond those cited in the Inspector General’s report. These incidents ranged from cases of deplorable conditions to deaths by beating to suicides stemming from sexual assault to lack of access to healthcare to lack of formal grievance systems and oversight within the prisons.

The administration’s policy shift caused a crash in the stock values of the two largest private prison companies in the United States, Corrections Corporation of America and Geo Group, Inc., falling 37% and 40% respectively. However, the stock values rebounded slightly in the days that followed amidst rosy projections by company CEO’s, moderate evaluations by industry analysts, and quotes from prison reformers and civil rights advocates about how much more needs to be changed. These insider reactions seem to be at odds with the Department of Justice’s announcement. Is U.S. policy regarding private prisons changing or not?

Scope of the Department of Justice Decision
In 2015 the Bureau of Prisons had custody over 192,628 inmates, 21,834 of whom were housed in private prisons, a privatization rate of 11%. The next largest federal entity that holds prisoners is the U.S. Marshals Service, which handles individuals before entry into prison to serve a federal sentence (i.e. arrest, trial, and transportation while in custody). In 2015 U.S. Marshals housed 51,862 prisoners, with 10,248 in private facilities, a rate of 20%. The smallest entity in absolute numbers is U.S. Immigration and Customs Enforcement, which has illegal immigrants as the main source of detainees. In 2014, Immigration and Customs Enforcement had 24,567 out of 33,676 prisoners in private facilities, a whopping rate of 73%. Both the U.S. Marshals and Immigration and Customs Enforcement fall outside of the jurisdiction of the Department of Justice and are not subject to the change in policy from Yates’s memo.


PictureData from the Federal Bureau of Prisons, U.S. Marshals Service, and Intercept.com


This data, especially from Immigration and Customs Enforcement, fluctuate from month to month and available data for this analysis covers two different years, so direct comparison is tough. However, if recent trends hold between years, the Department of Justice’s decision will impact a sizeable amount of federal prisoners in private facilities. Additionally, almost two weeks after the Department of Justice’s release of Yates’s memo, the Department of Homeland Security, the parent agency of Immigration and Customs Enforcement, announced that it will undertake a similar review to determine whether to keep using private facilities. If the Department of Homeland Security comes to the same conclusions as the Department of Justice, the vast majority of federal prisoners may be removed from private prisons.

Implications for States
While this is a potentially large shift in the number of prisoners in private facilities at the federal level, it is a small shift relative to the overall proportion of privately-held prisoners across the nation. This is because the majority of private prisoners are held at the state level. In 2014, 91,244 prisoners were held in private prisons across the 50 states, according to the Bureau of Justice Statistics.

Since the United States has a federal system, the federal government cannot directly tell states how to run their prison systems. Furthermore, states do not get significant prison funding from the feds, meaning the often-used policy tool of withholding money until states comply with federal guidelines cannot be used in these situations. This means the battle to end private prisons will have to be fought on the ground in each and every state that uses private prisons.

The Fight to Come
State-by-state battles against moneyed interests are always hard. When benefits are concentrated (lots of money for a few corporations) and costs are diffuse (civil rights of hundreds of thousands of prisoners and their families), it becomes difficult to sustain momentum for reform.

But this is a fight worth having. In addition to documenting cases of abuse, neglect, and death, for legal challenges, prison reform advocates have started a political and social conversation about the impact of private prisons. The concept of funding for rehabilitation, a central moral imperative of modern incarceration, is utterly antithetical to the profit model of private prisons. Why would they spend extra money to decrease their revenue-generating “inventory”? In annual corporate reports, private prison companies often identify falling crime rates, immigration reform, and other positive social trends as threats to their bottom lines. As the San Francisco Chronicle put it, “Private prisons are terrible public policy. Focused on the bottom line they cut corners… [they] have lobbied for increased criminal penalties because such laws inevitably mean more customers. But increasing incarceration for profit’s sake is bad for families, communities, taxpayers, and the concept of justice.” Any time perverse incentives lead powerful entities to fear positive social change, we as citizens must be wary and push back. Thanks to the efforts of a diverse group of people doing just that, the federal government has taken a small step towards ending this abhorrent practice.

Rick Zarrella is a Master of Public Policy Candidate at the Goldman School of Public Policy.  Before coming to GSPP, Rick was a Senior Paralegal at the Habeas Corpus Resource Center, an entity of the California Judicial Branch.