Sunday, November 16, 2014

PF Dec 2014 - For-Profit Prisons - Con Position


Resolved: For-profit prisons in the United States should be banned.

For part one of this series, click here.

Con Position

Many of the problems associated with private (for-profit) prisons are non-unique.  Housing individuals who have forfeited their right to move about freely in society is a tough and risky business, so Pro cannot claim many of the issues are strictly due to privatization.

Blumstein et al (2007):
Thus, by way of understatement, privatization of the delivery of governmental services has its critics and skeptics. Yet public management of public programs, such as prisons, hardly reflects a state of nirvana. There have been “widespread problems and deficiencies in many public prisons,” and a survey by the Harvard Law Review concluded that evidence “give[s] reason to be cautiously pleased with private prison performance.” Part of any analysis of the overall role of privatization must include an examination of the practical benefits that accrue from using private entities to provide public services. [page 3]

With that, we begin this analysis of the Con position.


Simplistic Laissez-Faire

A very simple view of the free market economy claims that by reducing barriers to entry into a market and lifting government restrictions, a kind of economic balance will be achieved, through competition, between supply and demand.  The result of this laissez-faire (open market) economy is market efficiency.  There is a view (for sure, a highly disputed view) that if left alone, the market will self-correct for its own deficiencies.  The catalyst for change is competition.  If prices are too high, competition tends to reduce prices. If services are inadequate, competition tends to favor those who provide better services. Thus, ideally, the market evolves and achieves equilibrium in prices, services, etc. I suppose the beauty of this theory of economics is that while cost-reduction in an effort to reduce prices may be the order of the day, the demand for better services will limit the reduction of quality services as a means of cost-cutting. Another important point, is over-sight and management come at a cost and few things on this earth levy a more costly over-sight than the government.

Blumstein et al (2007):
Cost-savings from privatization are generally attributed to (i) productive efficiencies inherent in private ownership and (ii) competition. These cost-savings arise from the relatively lower direct costs from private (as contrasted with public) management. The traditional focus of analysis has been on the cost-saving contribution that accrues directly from the differing incentives15 and institutional constraints16 that face private and governmental management. As a result, the emphasis in analysis and policy discussion has been on the direct contribution to programmatic cost-saving from private management as a competitor of and substitute for governmental management.[page 4]

Obviously, market efficiencies will be disputed by the Pro, who will claim there is no cost savings and the quality of services is less in privately run institutions.  However, all cost comparisons are extremely difficult due to the problems inherent in fully differentiating the source of costs.  For example, in some jurisdictions, the government incurs higher regulatory costs that other jurisdictions.  In addition, truly independent studies are difficult to find.  While Blumstein and his colleagues were commissioned by the Corrections Corporation of America, a supplier of private prison services, the Blumstein reports were published in peer-reviewed journals and are widely cited.  The Blumstein team's methodology has been clearly described and reviewed.  Even if the judge seems reluctant to accept the Blumstein reports, other truly independent studies have been conducted.

Kirchoff 2010:
In 1996, lawmakers instructed the Bureau of Prisons to conduct a five-year demonstration project comparing the cost of public prisons versus a private prison in Taft, CA. The Bureau of Prisons did its own follow-up evaluation and also paid for an independent analysis by consulting firm Abt Associates, Inc. The two reports produced findings that were significant enough that DOJ officials in 2008 held a special meeting to discuss approaches in methodology regarding the issue.115 For example, the Abt report said the private Taft facility was cheaper to run than three comparable public facilities, noting that in 2002 the average cost of the public facilities was  14.8% above that of the private prison. The Bureau of Prisons found, however, that the average cost of the public facilities in 2002 was only 2.2% more than the private prison.[page 23]

In her report to the Congressional Research Service, Kirchoff cites a Department of Justice report which concluded a 1% cost savings along with lower quality of service [page 23-24]. Kirchoff also cites the 2007 New Mexico study which showed the state paid more than necessary for private prisons due to unnecessary adjustments for inflation [page 24].  This illustrates the difficulties inherent in price comparison.  Just looking at dollars does not always tell the true story.  Kirchoff continues:

Kirchoff 2010:
Kevin Campbell of independent investment firm Avondale Partners says costs and potential cost savings vary widely from state to state.121 Based on his analysis, some state governments have tight oversight and may post significant savings by contracting out with private firms that pay lower salaries and do not offer pension benefits equivalent to those for public workers. He also says states can realize significant savings by shipping prisoners to existing, private institutions in other states, rather than building new prisons of their own.[page 24]

More specific to laissez-faire economics, does it work?  Consider this report.

Miller (2010):
Following along the lines of the capitalist model of competition previously suggested as a benefit of private prisons, Segal and Moore (2002) show that the introduction of privatization urges managers (both from public and private facilities) to implement cost-effective strategies while maintaining quality of services to remain competitive. They examine 28 studies and report that 22 show a significant savings without impacting quality when compared to public prisons. These 28 studies extensively compared across multiple variables; furthermore, "many of them went to great lengths to compensate for the differences between compared facilities and to develop useful comparison figures" (Segal & Moore). The authors conclude, "it is remarkable that such a wide variety of approaches spanning over a decade and a half of research conducted in states across the nation repeatedly come to the same conclusion: that privatization saves money without reducing quality . . . . Thus the extreme one-sidedness of this literature—near-universal findings of cost savings from privatization—is on its own very persuasive" (Segal and Moore, 2002b). Some quality issues noted include better living environments and improved prisoner-guard relations.

Reason for Banning?

Perhaps Pro can make a very rational argument for-profit prisons should be banned if they are costing society more money than spent on public prisons.  But is that really a reason to ban them?  Pro would need to establish some kind of standard for determining when the costs become excessive.  For example, are the costs resulting in higher than usual taxes? Is there great public outcry about the costs?  I spent a lot of time and space in the previous section to show at worse the cost of privatization is, perhaps, no greater than the cost of managing a public prison system and much of the evaluation of the costs are difficult to compare across jurisdictions. The economics argument is more exacerbated by the public acceptance of the incarceration of non-violent offenders (such as drug users) and longer prison terms which drives up the prison populations at a much greater cost to society as a whole. Other reasons may be found if the Pro can prove there is something inherently flawed in utilization of private services which harms public safety or denies inmates their civil or natural rights more so than what is seen in public facilities.


Dangerous Conditions

Pro will cite unsafe conditions, both for the public, the employees of the prison and the inmates which arise for various reasons; most notably, under-staffed or under-trained employees and improperly designed facilities.  However, while there are several examples of tragedies related to private prisons, it is easy to lose sight of the fact one of the key motivations for turning to private facilities results from extreme overcrowding in substandard, public facilities. These conditions result in danger to staff and inmates, especially when non-violent offenders are not adequately separated from violent inmates.

Consider as well, the situation in California where prisoners "sued the governor and corrections officials for violating their rights under the Eighth Amendment’s Cruel and Unusual Punishment Clause because they were being deprived of adequate health care" [Spector 2010:194].

Spector 2010:
Nearly five years after the Plata court placed California’s prisons in partial receivership and after the Coleman court issued more than seventy additional orders to improve mental health care, California’s prisoners remain at serious risk of injury or death because medical and mental health care remain abysmal. There is one primary reason why neither the state nor the receiver has been able to improve prison health care—overcrowding...Severe overcrowding makes the safe operation of a prison system nearly impossible. “Everything revolves around overcrowding. The deficiencies in the classification plan, the deficiencies in the unavailability of staff because they are doing other tasks associated with overcrowding problems to do onsite medical appointments or offsite medical appointments, the wear and tear on the infrastructure.” [page 194]

Spector goes on the describe a state of California proclamation that California was experiencing an over-crowding state of emergency which "“has caused substantial risk to the health and safety of the men and women who work inside these prisons and the inmates housed in them,” making prisons places of “extreme peril to the safety of persons.” {Spector 2010:194]

To ease overcrowding, and when private facilities are not available to take up the slack, government officials are forced to take other steps to alleviate the situation.

Daily Mail 2013:
The U.S. Supreme Court on Friday paved the way for the early release of nearly 10,000 California inmates by year's end despite warnings by Governor Jerry Brown and other state officials that a public safety crisis looms if they're forced to open the prison gates. A majority of justices refused an emergency request by the governor to halt a lower court's directive for the early release of the prisoners to ease severe overcrowding at California's 33 adult prisons.

The obvious solution for many states has been and continues to be to turn to the competitive market place for solutions.  Private contractors are willing to build the facilities, train the staff and house the inmates for the opportunity to make a profit.

Montague 2001:
Without new prisons, law enforcement officials will be forced to make difficult decisions about which dangerous criminals should be incarcerated and which should be allowed back onto the street. Unfortunately, because of tight budgets and other pressing needs, building enough government run prisons to safely hold the increasing inmate population is not financially feasible. A new study from the Washington Policy Center offers a sensible solution to this problem. "Private Prisons: A Sensible Solution" suggests allowing private contractors to compete for prison construction and management contracts. Allowing private companies to compete does not mean giving over control of prisoners to big corporations. Sentencing and oversight would be managed by the state, but taxpayers would benefit from the competitive pressures introduced by private competition.

Lessor of Evils

Generally, the public has little interest in how prisoners are treated.  I mean, everyone has a certain expectation that prisoners within the U.S. will be treated humanely but few people expect prisons to be pleasant retreats.  Often, when a convicted criminal is led from the court room to his or her fate, the public turns its gaze away from the inmate.  It's only when the "distant" world of prison justice intrudes upon our lives with requests for higher taxes, or when a prison riot erupts, or when an escape occurs does the public react.  Without for-profit prisons, the government must still deal with ever-increasing prison populations one way or another and over-crowding presents risks to staff and public as well as violate the human rights of the prisoners.  We also see that one obvious solution, the release of prisoners, is not favorable to the government or the public.  Private prisons provide a solution to a very real problem which in and of itself may introduce other kinds of problems the case is made it is the lessor of two evils.

Blumstein, JF, Cohen, MA, Suman, S. (2007); DO GOVERNMENT AGENCIES RESPOND TO MARKET PRESSURES? EVIDENCE FROM PRIVATE PRISONS, accessed 11/2/2014:
http://www.cca.com/Media/Default/documents/CCA-Resource-Center/Blumstein_Cohen_Study.pdf

Daily Mail (2013), Nearly 10,000 California prisoners to be released early to ease severe overcrowding, accessed at Mail Online 11/11/2014:
http://www.dailymail.co.uk/news/article-2383946/Nearly-10-000-California-prisoners-released-early-ease-severe-overcrowding.html

Kirchoff, S (2010), Economic IMpacts of Prison Growth, Congrssional Research Service, 7-5700. www.crs.gov, R41177 , April 13, 2010, accessed 11/2/2014:
http://fas.org/sgp/crs/misc/R41177.pdf

Miller, DW (2010), The Drain of Public Prison Systems and the Role of Privatization: An Analysis of State Correctional Systems, ProQuest Discovery Guides, Released February 2010, accessed 11/4/2014:
http://www.csa.com/discoveryguides/prisons/review.pdf

Montague, E. (2001), Private Prisons: A sensible solution, Washington Policy Center, August, 2001; accessed 11/12/2014:
http://www.washingtonpolicy.org/publications/opinion/private-prisons-sensible-solution

Segal, GF; Moore, AT (2002) Weighing the Watchmen: Evaluating the Costs and Benefits of Outsourcing, Correctional Services, Part I: Employing a Best-value Approach to Procurement, Reason Public Policy Institute, Policy Study No. 289., Accessed 11/4/2014:
http://reason.org/files/4ca7ce58f2a7b7a1529a21927459880a.pdf

Spector, D (2010), Everything Revolves Around Overcrowding: The State of California’s Prisons, Federal Sentencing Reporter, Vol. 22, No.3, February 2010, accessed 11/10/2014:
http://www.prisonlaw.com/pdfs/OvercrowdingArticle2010.pdf


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