The Prison Industrial Complex and the Global Economy

by Eve Goldberg and Linda Evans


Over 1.8 million people are currently behind bars in the United States. This represents the highest per capita incarceration rate in the history of the world. In 1995 alone, 150 new U.S. prisons were built and filled.
This monumental commitment to lock up a sizeable percentage of the population is an integral part of the globalization of capital. Several strands converged at the end of the Cold War, changing relations between labor and capital on an international scale: domestic economic decline, racism, the U.S. role as policeman of the world, and growth of the international drug economy in creating a booming prison/industrial complex. And the prison industrial complex is rapidly becoming an essential component of the U.S. economy.

Prisons Are Big Busines

Like the military/industrial complex, the prison industrial complex is an interweaving of private business and government interests. Its twofold purpose is profit and social control. Its public rationale is the fight against crime.
Not so long ago, communism was "the enemy" and communists were demonized as a way of justifying gargantuan military expenditures. Now, fear of crime and the demonization of criminals serve a similar ideological purpose: to justify the use of tax dollars for the repression and incarceration of a growing percentage of our population. The omnipresent media blitz about serial killers, missing children, and "random violence" feeds our fear. In reality, however, most of the "criminals" we lock up are poor people who commit nonviolent crimes out of economic need. Violence occurs in less than 14% of all reported crime, and injuries occur in just 3%. In California, the top three charges for those entering prison are: possession of a controlled substance, possession of a controlled substance for sale, and robbery. Violent crimes like murder, rape, manslaughter and kidnaping don't even make the top ten.
Like fear of communism during the Cold War, fear of crime is a great selling tool for a dubious product.
As with the building and maintenance of weapons and armies, the building and maintenance of prisons are big business. Investment houses, construction companies, architects, and support services such as food, medical, transportation and furniture, all stand to profit by prison expansion. A burgeoning "specialty item" industry sells fencing, handcuffs, drug detectors, protective vests, and other security devices to prisons.
As the Cold War winds down and the Crime War heats up, defense industry giants like Westinghouse are re-tooling and lobbying Washington for their share of the domestic law enforcement market. "Night Enforcer" goggles used in the Gulf War, electronic "Hot Wire" fencing ("so hot NATO chose it for high-risk installations"), and other equipment once used by the military, are now being marketed to the criminal justice system.
Communication companies like AT&T, Sprint, and MCI are getting into the act as well, gouging prisoners with exorbitant phone calling rates, often six times the normal long distance charge. Smaller firms like Correctional Communications Corp., dedicated solely to the prison phone business, provide computerized prison phone systems, fully equipped for systematic surveillance. They win government contracts by offering to "kick back" some of the profits to the government agency awarding the contract. These companies are reaping huge profits at the expense of prisoners and their families; prisoners are often effectively cut off from communication due to the excessive cost of phone calls.
One of the fastest growing sectors of the prison industrial complex is private corrections companies. Investment firm Smith Barney is a part owner of a prison in Florida. American Express and General Electric have invested in private prison construction in Oklahoma and Tennessee. Correctional Corporation Of America, one of the largest private prison owners, already operates internationally, with more than 48 facilities in 11 states, Puerto Rico, the United Kingdom, and Australia. Under contract by government to run jails and prisons, and paid a fixed sum per prisoner, the profit motive mandates that these firms operate as cheaply and efficiently as possible. This means lower wages for staff, no unions, and fewer services for prisoners. Private contracts also mean less public scrutiny. Prison owners are raking in billions by cutting corners which harm prisoners. Substandard diets, extreme overcrowding, and abuses by poorly trained personnel have all been documented and can be expected in these institutions which are unabashedly about making money.

Prison Labor

An American worker who once upon a time made $8/hour, loses his job when the company relocates to Thailand where workers are paid only $2/day. Unemployed, and alienated from a society indifferent to his needs, he becomes involved in the drug economy or some other outlawed means of survival. He is arrested, put in prison, and put to work. His new salary: 22 cents/hour. From worker, to unemployed, to criminal, to convict laborer, the cycle has come full circle. And the only victor is big business.
For private business, prison labor is like a pot of gold. No strikes. No union organizing. No unemployment insurance or workers' compensation to pay. No language problem, as in a foreign country. New leviathan prisons are being built with thousands of eerie acres of factories inside the walls. Prisoners do data entry for Chevron, make telephone reservations for TWA, raise hogs, shovel manure, make circuit boards, limousines, waterbeds, and lingerie for Victoria's Secret. All at a fraction of the cost of "free labor." Prisoners can be forced to work for pennies because they have no rights. Even the 14th Amendment to the Constitution which abolished slavery, excludes prisoners from its protections.
And, more and more, prisons are charging inmates for basic necessities--from medical care, to toilet paper, to use of the law library. Many states are now charging "room and board." Berks County jail in Pennsylvania is charging inmates $10 per day to be there. California has similar legislation pending. So, while government cannot (yet) actually require inmates to work at private industry jobs for less than minimum wage, they are forced to by necessity.
Some prison enterprises are state run. Inmates working at UNICOR (the federal prison industry corporation) make recycled furniture and work 40 hours a week for about $40 per month. The Oregon Prison Industries produces a line of "Prison Blues" blue jeans. An ad in their catalogue shows a handsome prison inmate saying, "I say we should make bell-bottoms. They say I've been in here too long." Bizarre, but true. The promotional tags on the clothes themselves actually tout their operation as rehabiliation and job training for prisoners, who of course would never be able to find work in the garment industry upon release.