Article: "Incentives to Detain: How Immigrants Drive Prison Profits" by Tom Barry

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Article: "Incentives to Detain: How Immigrants Drive Prison Profits" by Tom Barry

Prison industrial complex indeed. 


Incentives to Detain: How Immigrants Drive Prison Profits

By Tom Barry

Mining, railroads, agribusiness, and, recently, construction have been among the many U.S. industries that historically been driven by an abundant supply of immigrants. But now, when the economy is imploding, most industries are shedding immigrants. The private prison industry, however, is booming, largely because of the ever-increasing supply of immigrants supplied by the federal government.

In the past, when the government detained immigrants—legal or illegal—they were placed in one of a handful of official processing centers where they awaited a hearing or deportation. The Department of Homeland Security still runs seven immigrant detention centers.

Since the early 1980s, sparked by the Reagan administration's new enthusiasm for privatization and the free market, the Justice Department and now also DHS have been outsourcing most of the immigrant detainees to private firms that own or manage scores of prisons that annually hold hundreds of thousands of immigrants.


Corrections Corporation of America (CCA), the country's oldest and largest prison corporation, boasted that it enjoyed a $33.6 million increase in the third quarter over last year, while earnings rose 15% during the same period. Formerly known as Wackenhut, GEO Group, the nation's second largest prison company, saw its earnings jump 29% over 2007. Another private prison firm that imprisons immigrants is Cornell Companies, and it reported a 9% increase in net revenues in the third quarter.

Private prisons have been booming over the past eight years. From 2000 to 2005, the number of private prisons increased from 16% of all prisons to 23%. All of the increase in federal prisons has been in prisons owned or operated by private firms.


Private prison companies aren't worried that the Democratic Party sweep will mean that fewer immigrants are sent their way because of party promises of enacting comprehensive immigration reform. GEO Group's chairman George Zoley assured investors on Nov. 3: "These federal initiatives to target, detain, and deport criminal aliens throughout the country will continue to drive the need for immigration detention beds over the next several years and these initiatives have been fully funded by Congress on a bipartisan basis."

Not only has the DHS crackdown on illegal immigrants have bipartisan support in Congress, it was the Democratic Congress, say private prison chiefs, that increased the 2009 budget for the crackdown. "The president only asked for a program funding of $800 million," noted Zoley. "It was the Democratic chairman [of the Homeland Security subcommittee] ... that added another $200 million to this program."

In a post-election conference to report third-quarter revenue increases, CCA board chairman John Ferguson told Wall Street investors: "One budget that was put in place for the full year was immigration customs enforcement ... and the funding for that is for 33,400 beds—that's an increase from 32,000 in the prior fiscal year, and also that compares to a little over 31,000 detainees in [2007]."

"Just to remind everyone," Ferguson told investors, "detainee beds would be sourced from us from several places that immigration customs boys need: that's border apprehensions, people that overstay their visas, [immigrants] that are identified as criminals, and the jails and prisons [that hold immigrants] who have completed their time and will be deported."


The prison executives even intimate that the economic crisis will fatten their business. When asked by an investment company representative about a possible downturn in detained immigrants as a result of new government policies, James Hyman, president of Cornell Companies, said, "We do not believe we will see a decline in the need for detention beds particularly in an economy with rising unemployment among American workers."

What is more, he told investors that there exists a pool of "10 million plus illegal immigrants" the company draws from and there is an "imbalance" between the number of immigrants and number of available prison beds.

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