Prison Labor Is Cheap Labor for Transnational Corporations
The master class has reintroduced a system of penal servitude which makes prisoners slaves of transnational corporations.
It is important to recall that many of the first settlers of the "New World" were actually British, Scottish, Irish, French, German, and Dutch convicts sold into indentured servitude. Selling "criminals" to the companies exploring the Americas lowered the cost of maintaining European prisons (since they could remain relatively small), enabled the traditional elite to rid themselves of potential political radicals, and provided the cheap labor necessary for the first wave of colonization. Indeed, as detailed in both Peter Linebaugh's 'The London Hanged' and A. R. Ekirch's 'Bound for America', there is a strong historical relationship between the need for policing the unruly working classes, fueling the military and economic needs of the capitalist class, and greasing the wheels of imperialism with both indentured servants and outright slavery. - Stephen Hartnett, Prison Labor, Slavery & Capitalism In Historical Perspective
Ohio First in U.S. to Sell Prison to Private Company
CCA (Corrections Corporation of America) (NYSE: CXW), the nation's largest partnership corrections provider to government agencies, announced today that it has entered into a contract with the state of Ohio to purchase and operate the 1,798-bed Lake Erie Correctional Institution located in Conneaut, Ohio. The Lake Erie facility is currently managed by another private operator. This contract represents the first contract CCA has had with the state of Ohio. CCA will purchase the 1,798-bed Lake Erie facility, which was constructed in 1999, for a purchase price of approximately $73.0 million and expects to invest approximately $3.1 million in capital improvements. The management contract, which is expected to commence on January 1, 2012, has an initial term of twenty years with unlimited renewal options subject to appropriations and mutual agreement. The contract also provides a guaranteed occupancy of 90 percent [editor's note: how can they guarantee a 90 percent occupancy!]. CCA will be compensated by a per diem rate for operating related services and an Annual Ownership Fee (AOF) for costs associated with the ownership of the facility. [CCA Press Release, September 2, 2011]September 1, 2011
AP - A lockup along the shores of Lake Erie has become the first state prison in the nation to be sold to a private company.
Lake Erie Correctional Institution in northeastern Ohio's Ashtabula County is the only one of five state prisons up for sale that will be sold, state officials said Thursday. Corrections Corporation of America will buy it for $72.7 million, more than the $50 million needed from the privatization effort to balance the state's prison budget.
The four other prisons for sale didn't generate offers advantageous to taxpayers, state officials said.
CCA, the nation's largest prison operator, takes control of the Lake Erie facility in Conneaut on Dec. 31, pending the outcome of a lawsuit challenging the constitutionality of the move.
Offering the prisons for sale was an idea spearheaded by Republican Gov. John Kasich as he grappled with an $8 billion budget hole earlier this year. He wasn't the only governor to propose it: Republican Gov. Bobby Jindal of Louisiana introduced a similar plan that was shot down by state lawmakers in June.
Management Training Corp. of Centerville, Utah, successfully landed rights to operate North Central Correctional Institution and the vacant Marion Juvenile Correctional Facility as a single prison camp, saving 6 percent on state costs, the prisons department said.
North Coast Correctional Treatment Facility in Lorain County, currently operated along with Lake Erie by MTC, will be returned to state control and merged with Grafton Correctional Institution.
"I was taken aback," said Ohio Civil Service Employees Association president Chris Mabe about the news.His union, representing prison guards and other corrections employees, had staged protests in Ashtabula, Marion and Lorain counties, where prisons were up for sale, over fears of lost jobs and jeopardized safety.
"As it stands right now today, it gives us hope," he said, noting OCSEA has worked with state prisons officials for a decade to see a merger of the two Grafton buildings that would save state jobs.The state said it doesn't anticipate job losses on the newly configured Marion campus, and state jobs may be added at the Grafton complex.
The American Civil Liberties Union of Ohio said the prison sale doesn't fix the main problem that too many people are being incarcerated.
"These changes are nothing more than a Band-Aid for the deep-seated problems that continue to plague our state," Policy Director Shakyra Diaz said in a statement. "Privatization does nothing to address it, and may actually make it worse by allowing companies to make a profit off imprisoning people."The prisons department is requiring private facilities to meet all state safety mandates, and it's stepping up its oversight function, said Annette Chambers-Smith, deputy director of administration at the prisons department.
The combination of operational changes -- part of Kasich's privatization push -- is estimated to save the state a combined $13 million annually, about twice as much as what was anticipated.
Nashville, Tenn.-based CCA will operate the Lake Erie prison, which cost $41 million to build, at 8 percent less than the state did, generating $3 million in savings. The facility plans to add 304 beds.
While not buying the facility, MTC plans to operate the Marion campus at $3 million less than state estimated costs. The existing prison and shuttered juvenile facility, which will be reopened for adults, will include 398 new beds.
A third bidder, GEO Group Inc., of Boca Raton, Fla., wasn't selected. The company has come under scrutiny in its home state, where federal investigators are reviewing the circumstances surrounding development of the state's largest private prison, Blackwater River.
Ohio's prisons are over capacity, housing some 51,000 inmates in 31 prisons built to hold about 38,000. Estimates suggest the inmate population could rise to 54,000 in four years if nothing changes.
Private prisons are expected to be as crowded as public ones under the new plan, said Linda Janes, chief of staff for the Ohio Department of Rehabilitation and Correction.
The state is in the process of trying to reduce its prison population by putting fewer nonviolent offenders behind bars and giving judges more sentencing options. Those changes are estimated to trim the state's inmate population by 47,000 by 2015. About 12,000 inmates are serving sentences of under a year.
Those changes follow a recent review by the Council of State Governments Justice Center. The center's report in July said the state cycles too many low-risk offenders serving short sentences through the prison system, costing Ohio $189 million in 2008 alone on inmates with an average sentence of just nine months.
CCA houses 75,000 offenders and detainees in more than 60 facilities with more than 80,000 beds -- more than half those under private operation in the country, according to its website. Forty-four of the facilities are owned by the company. Its partnerships include federal corrections agencies, nearly half the states and more than a dozen local governments. It employs 17,000 people.
Its Ohio lobbyist, Don Thibaut, served as Kasich's chief of staff when he was in Congress. The company retained Thibaut's new lobbying firm in mid-December. State prisons director Gary Mohr spent five years as a consultant to the firm. Mohr recused himself from the selection process. He said Thursday he learned of the committee's decision after the deal had been signed late Wednesday afternoon.
CCA already operates one federal prison in Ohio, the Northeast Ohio Correctional Center in Youngstown, but no state facilities.
BP Hires Prison Labor to Clean Up Spill While Coastal Residents Struggle (Excerpt)
The Nation - In the first few days after BP's Deepwater Horizon wellhead exploded, spewing crude oil into the Gulf of Mexico, cleanup workers could be seen on Louisiana beaches wearing scarlet pants and white t-shirts with the words "Inmate Labor" printed in large red block letters. Coastal residents, many of whom had just seen their livelihoods disappear, expressed outrage at community meetings; why should BP be using cheap or free prison labor when so many people were desperate for work? The outfits disappeared overnight.
Known to some as "the inmate state," Louisiana has the highest rate of incarceration of any other state in the country. Seventy percent of its 39,000 inmates are African-American men. The Louisiana Department of Corrections (DOC) only has beds for half that many prisoners, so 20,000 inmates live in parish jails, privately run contract facilities and for-profit work release centers.
Prisons and parish jails provide free daily labor to the state and private companies like BP, while also operating their own factories and farms, where inmates earn between zero and forty cents an hour.
Obedient inmates, or "trustees," become eligible for work release in the last three years of their sentences. This means they can be a part of a market-rate, daily labor force that works for private companies outside the prison gates. The advantage for trustees is that they get to keep a portion of their earnings, redeemable upon release.
The advantage for private companies is that trustees are covered under Work Opportunity Tax Credit, a holdover from Bush's Welfare to Work legislation that rewards private-sector employers for hiring risky "target groups." Businesses earn a tax credit of $2,400 for every work release inmate they hire. On top of that, they can earn back up to 40 percent of the wages they pay annually to "target group workers."
Defense Contractors Using Prison Labor to Build High-Tech Weapons Systems
Prison labor seems like a win-win to many, but a closer look reveals a race to the bottom for skilled workers.April 28, 2011
AlterNet - It is a little known fact of the attack on Libya that some of the components of the cruise missiles being launched into the country may have been made by prisoners in the United States. According to its website, UNICOR, which is the organization that represents Federal Prison Industries, “supplies numerous electronic components and service for guided missiles, including the Patriot Advanced Capability Missile (PAC-3)”.
In addition to constructing electronic components for missiles, prison labor in the United States is used to make electronic cables for defense items like “the McDonnell Douglas/Boeing (BA) F-15, the General Dynamics/Lockheed Martin F-16, Bell/Textron’s (TXT) Cobra helicopter, as well as electro-optical equipment for the BAE Systems”.
Traditionally these types of defense jobs would have gone to highly paid, unionized workers. However the prison workers building parts for these missiles earn a starting wage of 23 cents an hour and can only make a maximum of $1.15 an hour. Nearly 1 in 100 adults are in jail in the United States and are exempt from our minimum wage laws, creating a sizable captive workforce that could undercut outside wage standards.
"It's no different than when our government allowed a United Steelworkers-represented factory of several hundred good jobs in Indiana called Magnequench to shut down," United Steelworkers Public Affairs Director Gary Hubbard told AlterNet. "This was the last high-tech magnetics production plant in the U.S. that made guidance components for missiles and smart bombs. The factory was sold to a Chinese state enterprise that moved all the machinery to China. And now we depend on prison labor to build our defense products?"
As the governments look to cut costs and trim deficits, they are giving more and more contracts for skilled work to prisons, whose workers often make 1/15th of the wages they would earn in the private sector. Whereas in the past prisoners made license plates and desks for state offices, they are now being trained for skilled work doing everything from assembling cable components for guided missiles to underwater repair welding. Even the much heralded green jobs aren’t immune to being outsourced to prison -- the solar panels being used to provide electricity for the State Department’s office in Washington, D.C. are constructed with prison labor.
States are increasingly expanding the type of products they use prison labor for to help cover the cost of keeping a person in prison -- nearly $29,000 per year. States spend a whopping $60 billion dollars per year to maintain prisons, one of every 15 state dollars is spent on prisons, and corrections spending is the second fastest-growing expenditure in state budgets. Prisons are popular in small town America because they often mean bringing several hundred jobs to economically depressed communities. Thus many are in favor using incarcerated labor to pay for prisons because they work as a means of economic development.
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