The term prison-industrial complex refers to all of the businesses and organizations involved in the construction, operation, and promotion of correctional facilities and the services they provide. Such groups include private corrections companies, corporations that contract prison labour, construction companies, surveillance technology vendors, and the lobbyists and interest groups that plurally represent them. Private prisons began in the 1980s but they really took off in 1990 under Clinton.
The prison industry is the most profitable sector in the US economy today. Consider the growth of the Corrections Corporation of America, the industry leader whose stock price has climbed from $8 a share in 1992 to about $30 today and whose revenue rose by 81 per cent in 1995 alone. Investors in Wackenhut Corrections Corp. have enjoyed an average return of 18 per cent during the past five years and the company is rated by Forbes as one of the top 200 small businesses in the country. At Esmor, another big private prison contractor, revenues have soared from $4.6 million in 1990 to more than $25 million in 1995. The list of companies investing in the prison industry contains the cream of U.S. corporate society: IBM, Boeing, Motorola, Microsoft, AT&T, Wireless, Texas Instrument, Dell, Compaq, Honeywell, Hewlett-Packard, Nortel, Lucent Technologies, 3Com, Intel, Northern Telecom, TWA, Nordstrom’s, Revlon, Macy’s, Pierre Cardin, Target Stores, and many more. The stock price for these major corporations is representative of the number of people in jail. That is a sign of very sick society.
The prison-industrial complex makes approximately 40 billion dollars per year. This entire industry is based on an essentially limitless raw material – prisoners. Just like all massive American corporations the big prison corporations hire big time lobbyists. In 1995, Wackenhut Chairman Tim Cole testified before the Senate Judiciary Committee to urge support for amendments to the Violent Crime Control Act — which subsequently passed — that authorized the expenditure of $10 billion to construct and repair state prisons. The relationship between these corporations and US politicians ensures the prisons will be kept full. These corporations answer directly to their shareholders who want one thing and one thing only – profit. That means cutting costs everywhere possible. As a result private prisons have much worse conditions than their government run counterparts.
In the two decades since the prison boom began crime rates have remained the same while icarceration rates have increased exponentially. Prison populations soared through the 1980s and into the 1990s, making the U.S. the unquestioned world leader in jailing its own populace. By 1990, 421 Americans out of every 100,000 were behind bars, easily outdistancing their closest competitors, South Africa and the then USSR. By 1992, the U.S. rate had climbed to 455. Reagan’s Anti-Drug Abuse Act of 1986 added mandatory minimum sentances for simple drug possesion and trafficing. The war on drugs is the lifeblood of the prison-industrial complex and they won’t let it go without a fight.