In her book The
New Jim Crow, Michelle Alexander comments on the problems facing prison
reform. Among them is the well-financed resistance of private prison corporations.
She quotes from the 2005 annual report for the Corrections Corporation of
America, which explained the vested interests of private prisons
matter-of-factly in a filing with the Securities and Exchange Commission:
“Our
growth is generally dependent upon our ability to obtain new contracts to
develop and manage new correctional and detention facilities. This possible
growth depends on a number of factors we cannot control, including crime rates
and sentencing patterns in various jurisdictions and acceptance of
privatization. The demand for our facilities and services could be adversely
affected by the relaxation of enforcement efforts, leniency in conviction and
sentencing practices or through the decriminalization of certain activities
that are currently proscribed by our
criminal
laws. For instance, any changes with respect to drugs and controlled substances
or illegal immigration could affect the number of persons arrested, convicted
and sentenced, thereby potentially reducing demand for correctional facilities
to house them.”
This list of prospective growth areas presents a number
of them that are in flat opposition to public objectives, e.g. public policy
seeks to reduce recidivism as opposed to the corporate concern to increase it.
It takes little imagination to see the politics of private prison corporations,
e.g. criminalizing every human activity they can, lengthening sentences, etc.
The sources of increased profit could play out in political payola and/or well-funded
referenda.
Let me pause here and discuss capitalism’s demand for
growth. One can imagine company content
with making a certain level of profit. It does not need to seek funds beyond
those supplied by its revenue. However, should such a company meet circumstances
requiring additional funds or merely indulge in the lust to be bigger, it must
borrow that money. Typically this is done by a public stock offering of shares in
the company. The stock holders become part owners of the company and are
entitled to their share of the profits. Even this level of complexity is
understandable. In the early phases of capitalism people would often invest in
a ship going to pick up spice, silks and other valuables from the Far East. If
the enterprise was a success each investor shared the profits to the extent of
their investment. Today, however, once the modern day corporation issues stock
that stock becomes a commodity to be sold. It takes on a life of its own; a
life of speculation and of whatever processes the financial markets can dream
up. It is primarily this phase of capitalism that drives modern day capitalism.
This type of capitalism may have only modest concern for corporate earnings. It
is interested in the trading value of the stock, which may vary with anything from
speculation about the company’s possible future development to the hiring of a
new CEO. To meet the demands of many of today’s investors it is necessary to
show a profit, often over only the last quarter, above the profit of the
previous quarter, no matter how profitable the previous quarter may have been.
Thus a demand for growth can and often is, unrelated to the production of the
company. It has become a financial figment in a casino of speculation,
concerned with value as established on the trading floor.
Public services have no inherent need for growth. The
demand for growth distorts public services grotesquely. Any effort to privatize
a public service should be evaluated from the growth perspective. Public officials must require a “growth
report,” not unlike an Environmental Impact Report (EIR), that would detail the
corporation’s opportunities and requirement for growth from the privatized public
service. The rather candid statement quoted above might be a good place to
start.
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