
          Cells for Sale
          By Wray, Harmon L., Jr.Harmon L. Wray, Jr.
          Vol. 8, No. 3, 1986, pp. 3-6
          
          The rush to transfer government services and functions from public
to profit-making hands has lately found its way to the "field" of
incarceration and corrections. The current leader in this new growth
industry is the Nashville-based Corrections Corporation of America,
chartered in January of 1983 and financed by Hospital Corporation of
America founder Jack Massey of Massey Burch Investments, Inc., the
South's largest venture capital company. According to CCA president
and former Tennessee Republican Party Chairman Tom Beasley, the
Corrections Corporation of America alma to ~be to jails and
prisons...what Hospital Corporation of America has become to medical
facilities nationwide."
          Declaring that "the market is limitless," Beasley (age 43) hopes to
"solve the prison problem and make a lot of money at the same time."
CCA currently has seven contracts to own and/or manage detention
centers, treatment facilities, jails and workhouses for federal and
local jurisdictions in several Southern states--three in Tennessee,
one in Florida, two in Texas (for illegal aliens), one in North
Carolina. But this is small potatoes compared with what CCA intends to
do: take over the entire prison system of particular states, and
prepare for a bid on the federal system. "The private jail market is
ripe," reports Barron's, the business weekly. "And it
is brokers, architects, builders, and banks-not the taxpayers-who will
make out like bandits.. In less than a year, CCA has more than doubled
the size of its staff, now at 500.
          The proposal CCA made to the State of Tennessee in the fall of 1985
was the boldest move yet in prisons-for-profit and showed why the
company is considered the most aggressive and well-connected of the
capitalist corrections firms. CCA initially proposed to buy out and
operate the state's prison system, under federal court order since
1982, as well as build and manage two new prisons (later expanded to
five new institutions). Thanks to effective lobbying by the American
Federation of State, County and Municipal Employees (AFSCME) and the
American Civil Liberties Union of Tennessee, the CCA bid was tabled
last year by the Democratically-controlled state legislature. The
action came during a special session called for the prison crisis by
Republican governor Lamar Alexander, a CCA supporter who once rented a
garage apartment to law student Tom Beasley. Alexander has spent seven
years overseeing an unconstitutional prison system but has never set
foot inside one of his state's prisons.
          This year, the General Assembly, under the influence of nine
full-time, high-powered CCA lobbyists paid an estimated $100,000,
passed a more moderate privatization bill. Before the session Tom
Beasley had 

said, "I intend to get a chunk of this system." Soon he
will: the 180-bed Carter County work camp opens September 1, probably
under CCA operation. But the legislation (which AFSCME plans to
challenge in court) prohibits further privatization of Tennessee
prisons for three years.
          The ambitions of Beasley and other prison entrepreneurs are not
limited to Tennessee. In fact, once CCA lost its bid for all Tennessee
prisons, it pursued a smaller "chunk" primarily in order to avoid the
embarrassment of having no home-state contracts to advertise in its
sales pitch to other jurisdictions. Last December Beasley said that if
the Reagan administration decided to sell the federal prison system
(as the The Wall Street Journal had just reported it
might), CCA would make an offer. CCA was one of three firms bidding
for the multi-million dollar Moundsville, W.Va., prison, site of a New
Year's Day prisoner rebellion. Reportedly, CCA has been working on
proposals for state prison systems in Florida, North Carolina, Texas,
Georgia, Louisiana, Misissippi, and Kentucky, as well as several
western states. At this writing, CCA contracts to operate jails are
pending in Sante Fe, N.M., and Key West, Fla. Meanwhile, CCA's
Tennessee competitor, Corrections Associates Inc. (CAI), recently
landed Tennessee and Alabama county jail contracts and a prison
consulting contract with the Alexander administration. CAI's good
fortune came on the heels of the resignation of its new president,
Hubert McCullough, as Governor Alexander's finance commissioner.
          The McCullough-Alexander connection is only one of many personal,
business, and political linkages evident in the prisons-for-profit
field. Like CAI's McCullough, CCA lobbyist Tom Ingram, 39, a former
journalist and social worker, has been a prime mover with the
anti-labor Tennessee Business Roundtable. Ingram also managed
Alexander's two winning gubernatorial campaigns and served as his
chief-of-staff for four years before forming his own public relations
and business consulting firm. Others in the CCA-Alexander circle
include CCA stockholders who are current and former Alexander cabinet
officers, CCA administrators who are former state GOP chairpersons, a
CCA lobbyist who was a Democratic state senator, and two prominent
public figures who in 1985 sold their CCA stock to avoid the
appearance of conflict of interest: Honey Alexander (the governor's
wife held $5,000 of stock) and House Speaker Ned Ray McWherter
($33,000), the Democratic nominee to succeed Alexander. In this fall's
general election, McWherter faces former Republican governor Winfield
Dunn, a Memphis dentist who became a multi-millionaire as an executive
for Hospital Corporation of America. Both Dunn and McWherter have
called for the state to experiment with private operation of some
prisons.
          Another connection is the US Military Academy. Before graduating
from Harvard's law and business schools, CCA treasurer and major
investor Doctor R. Crants was Beasley's West Point roommate. CCA
stockholder Samuel W. Bartholomew, of the Nashville law firm Donelson,
Stokes &Bartholomew, was their classmate ('66).
          Three of Bartholomew's children are also stockholders. Another West
Point alum and major CCA investor is T. Don Hutto, the corporation's
executive vice-president. Hutto, an ex-prison guard who became
commissioner of corrections in Virginia and Arkansas, has since 1984
been president of the American Correctional Association, which
oversees prison accreditation standards. Unlike other
corrections-related professional associations-the National Sheriffs
Association, the National Conference of State Trial Judges, the
National Association of Criminal Justice Planners, and the American
Bar Association--the ACA under Hutto's tenure has supported prison
privatization.
          While the prisons-for-profit trend has national dimensions, CCA
leadership has focused much of the attention onto the South, where all
of CCA's current contracts and most of its financial backers are
located (investors include Vanderbilt University, Hospital Corporation
of America, and that symbol of public service delivery, the Tennessee
Valley Authority, itself often the target of privatization
initiatives). Many members of CCA's management staff have worked in
corrections departments in Southern states, including Virginia,
Louisiana, Texas, and Alabama.
          Critics of corporate punishment have raised a number of issues
which call the privatization trend into serious question. Tennessee
Attorney General Michael Cody and the ACLU National Prison Project
note that the state would retain ultimate legal and fiscal
responsibility for assuring private prisons' compliance with state and
federal constitutions and court orders. It also appears clear that
governments cannot contract their civil liability to private
concerns. Noting CCA's lack of a track record in operating a state
prison for long-ternm adult offenders, Cody also questions its
estimates of operating and capital expenses and doubts the state's

ability to buy back its prisons in case of a private firm's
bankruptcy, incompetence, or unwillingness to continue. Cody suggests
that privatization might encourage the public to believe, mistakenly,
that Tennessee can solve its corrections problems simply by building
more prisons.
          A 1985 Tennessee legislative report points out that privatizing
does not mean that construction costs are not a liability of the
state; rather, the liability has been deferred." Mark Gray of AFSCME
wonders if an artifically low cost presented in an initial contract
would lead to government dependency on the private firm, making it
"impossible to resume operations in the future without huge capital
investments. The private contractor is then in a position to raise its
prices" in order to maximize profits. Former Minnesota corrections
chief Ken Schoen has pointed to "defense" contractors' use of similar
tactics as a way of "capitalizing on the public's fears to assure an
ever-expanding system, while the basic insecurities remain."
          Closely associated with such economic concerns is the question of
just how a private firm will be able to operate prisons as
inexpensively as it claims. Public employee unions like AFSCME and the
Tennessee State Employees Association point to workers' loss of civil
service rules and benefits under private prison managers, along with
the possibility of lower wages, a minimal workforce, an anti-union
atmosphere, and inadequate training of correctional officers. It may
be no accident that corrections capitalists' favorite hunting ground
for contracts has been the historically low-wage and under-unionized
South. And, whether they are called "prison guards" or "correctional
officers," those workers who staff our society's cages are already
among the lowest paid of all government employees.
          Certainly, prisoners themselves could suffer harmful effects from
possible cost-cutting for the sake of profit maximization. CCA's
initial proposal to Tennessee proclaims the intention of developing a
"full-employment economy within the correctional system." Given the
history of Tennessee's and other Southern states' "privatization" and
"profitization" of prisons, one might be excused for expecting some
contemporary variations on the old convict lease systems and chain
gangs. Journalist Ronnie Dugger's discomfort over the proposed
privatization of the Texas prison system might also apply to other
Southern states: "In the company prison, we will be putting
state-sentenced inmates under the command of the employees of the
corporation and forcing the state-sentenced inmates to labor for the
profit of the corporation. What will keep a privately-owned Texas
prison from being in its very nature a state-created system of slave
labor for private profit?" Constitutionally, slavery is legal as
punishment for crime, and our Southern prison populations are, of
course, overwhelmingly poor and disproportionately black and
Hispanic.
          Apprehensions on the part of prisoner advocates and those who abhor
slavery may not be unfounded when one considers the professional
history of T. Don Hutto, the man CCA touts as its foremost corrections
expert. The CCA's executive vice-president's career includes a stint
as warden of the Ramsey Unit in Huntsville, Texas, in the 1960s, when
the system of using inmates to guard and discipline other inmates,
later outlawed in federal court, was "at its strongest," according to
the Texas Observer. A 1985 article in The
Nation reported that during Hutto's tenure as corrections
commissioner in Arkansas the US Supreme Court ruled that state's
prison system unconstitutional and found that officials "evidently
tried to operate their prisons at a profit." "Inmates were required to
work on prison farms ten hours a day, six days a week, often without
suitable clothing or shoes, using mule-drawn plows and tending crops
by hand....Punishment for minor misconduct included lashing with a
wooden-handled leather strap...and administering electric shocks to
'various sensitive parts of the inmate's body.' The trial court called
the prisons 'a dark and evil world completely alien to the free
world.'" When confronted with this criticism, a CCA offical responded
that The Nation essay was "a libelous article" and that
Hutto had in fact cleaned up the unconstitutional Arkansas system.
          The questions raised by Hutto's track record and by a look at the
history of profit-making out of the hides of prisoners were echoed by
Michael Walzer in The New Republic: "Helpless men and
women have never fared well at the hands of profit-seeking
entrepreneurs. The incentive system is all wrong. Who will look after
the interests of prisoners? Who will be watching the prison owners as
they run their 'own' business?"
          Prisoners and their advocates in many Southern states lock at the
decades of class-action litigation efforts to remedy their
unconstitutional prison systems (now ten years in Tennessee) and
wonder how much longer it would have taken had the prisons been

privately owned during that time. The potential for foot-dragging and
buck-passing would surely increase substantially under private
ownership and implementation of state functions. The Tennessee Senate
Speaker's favorable response to the privatization concept speaks
volumes: "If somebody else ran it, somebody else would be in court. We
wouldn't."
          An analogy with recent corporate mobility trends, another point
made by Walzer, is especially striking when seen in a Southern
context: "This is probably the chief economic advantage of
privatization-that it offers a (temporary) escape from the enforcement
of constitutional norms. The resulting savings are like the profit
added when a factory moves from a union to a non-union territory. If
the union catches up, the old situation is restored. Similarly, if the
courts catch up, we will find oursleves again where we are now, with
judges struggling to do what state legislatures and Congress ought to
do-reform the prison system."
          Perhaps the most critical flaw in the privatization move is that it
is inherently expansionist. A corporation paid per prisoner and per
diem will look to lock up more and more people for longer and longer
stretches. Recall the historic Southern practice of determining the
county sheriffs' pay according to their jail counts. CCA's Tennessee
proposal assumed a steadily expanding prison population (despite the
falling crime rate), and its preferred per diem method of being paid
has already led to cost overruns for local taxpayers at its
Chattanooga penal farm.
          The US locks up a larger percentage of its population than any
country in the world, with two exceptions: South Africa and the Soviet
Union. Some of our Southern states rank even higher than those
nations. We ought to be reducing our costly, ineffective, cruel, race-
and class-biased overreliance on incarceration in favor of
community-based alternative sentences for non-violent offenders, such
as victim restitution programs. Other effective alternatives to
incarceration include intensive probation, community service work,
victim-offender mediation, and required drug and alcohol treatment,
GED preparation, vocational training, and job placement. Such options
are used frequently with white collar criminals, but perpetrators of
street crimes are scarce in these programs.
          Organizations such as AFSCME, the American Civil Liberties Union,
the National Sheriffs Association, the Vera Institute of Justice, and
the National Association of Criminal Justice Planners have all voiced
the fear of an inevitable expansionism in this new "growth industry."
Vera Institute's Michael Smith, noting that "the private sector has an
enormous investment in stimulating demand," fears corporate
advertising campaigns to heighten the public's fear of crime and
trigger a "lock 'em up" reaction resulting in an increasing number of
cages, captives, and dollars.
          NACJP director Mark Cunniff, calling CCA's Tennessee takeover
proposal "incredible," points out that "private contractors can lobby
in ways that a public agency cannot." When those doing the lobbying
are close friends and political advisers of governors and legislators,
many of the traditional lobbying techniques will be unnecessary.
          Perhaps Ken Schoen has put it best: "Private operators whose growth
depends upon an expanding prison population may push for ever harsher
sentences. With the public's unabating fear of crime, and the
lawmakers shrinking from any move that appears to be soft on
criminals, the developing private prison lobby will be hard to
resist. Any drop in the crime rate will be attributed to long prison
sentences. An increase will add weight to the call for more
prisons. And the taxpayers will finance the profit-makers while
double-locking their doors at night."
          Michael Smith says that the scenario sketched out above "worries me
enough so that I want to look first at making government innovative
and responsive." This points toward a possible third option, between
the inefficient and incompetent status quo and the CCA-type
prisons-for-profit. Walzer suggests, "...we should deputize
nongovernmental agencies to perform some prison-like functions....we
all might benefit, prisoners, too, from a little flexibility,
unorthodoxy, experimentation. But this will have to be the work of
nonprofit agencies, with publicly recognized programs and explicit
authorization. We should not be contracting out, as if these were not
our prisoners; we should be bringing new ideas into the orbit of
public service."
          The most reasonable conclusion to be drawn from all this is simply
that the citizens and legislatures of our Southern states should avoid
the new "dungeons for dollars" game like the plague. The privatization
debate distracts us from the real issue of our society's failure to
deal with crime in any way other than a knee-jerk, repressive
fashion. This is especially true in the South, which tends to have the
highest incarceration rates, the longest sentences, and the most
executions.
          Most citizens-white and black, rich and poor, male and
female-regularly report that crime and punishment constitute one of
the most salient and urgent issues in their lives. Almost no one,
however, is satisfied with our criminal justice system as it is.
          As I have suggested, there are alternative approaches to the issue
of crime and punishment, but only a few prisoners, lawyers, academics,
and prison reform advocates seem to know or care much about them. As
in the field of health, our society's primary approach to crime ought
to be a preventive, environmental, "public health" strategy. The
implications of this approach reach beyond even such a necessary
action as the denial of easy handgun access. We must resist and recast
the media glorification of violence, insist upon economic and
political equality irrespective of race and sex, confront the climate
of national militarism, and reconstruct an American culture and
economic system propelled by human greed. Meanwhile, we will continue
to have to lock up violent, dangerous offenders, but, for the many
others, our motto should be "from the cage to the community," which is
largely where the problem is and must be dealt with. We must refuse
the exploitation of public hysteria and institutional fatigue by the
entrepreneurs of captivity.
          
            Harmon L Wray, Jr., lives in Nashville where he is a
staff consultant with Project Return and teaches prison ministry at
Vanderbilt Divinity School.
          
        