How Private Prisons Game the Immigration System
Heat rises from the border road as a Border Patrol agent sits at an observation point along the international border separating San Luis, Arizona, from San Luis, Sonora, Mexico. (AP Photo/Matt York)
Thirty years ago in January, Corrections Corporation of America (CCA), now the biggest operator of private prisons in the world, opened its first prison, a federal immigrant detention center in Houston, Texas. Three Decades of Service to America, a page on the company’s website, features a video interview with the company’s founders looking back on that first contract. “We saw this big ol’ sign, ‘Olympic Motel,’ made an offer to lease the motel for four months,” recalls Don Hutto, who chuckles with fellow co-founder Tom Beasley, the former chairman of the Tennessee Republican Party, as they remember hastily converting the building and staffing it with family members. The night of Super Bowl Sunday, “we got our first day’s pay for eighty-seven undocumented aliens,” says Hutto, who even fingerprinted the inmates himself.
Three years after the company’s first contract in 1983, according to Southern Changes magazine, the company spent some $100,000 lobbying the state of Tennessee to secure a correctional facility privatization bill, which helped propel the business to financial success. Last year, the company brought in $1.7 billion in revenues, about a quarter of which came from contracts with the Immigration and Customs Enforcement (ICE) and federal Bureau of Prisons to incarcerate non-citizens in the United States.
For a company that began and later thrived by imprisoning immigrants, the federal immigration policy overhaul expected this year presents both opportunities and challenges.
Should these congresspeople really be making decisions on immigration reform when they've taken so much money from the corporations who stand to gain from stricter enforcement measures?
On the one hand, a pathway to citizenship and legal reforms sought by advocates could reduce the number of immigrants detained by CCA and its competitors in the private prison industry. “Private prison corporations have an enormous stake in immigration reform,” says Bob Libal, a prison reform advocate with Grassroots Leadership. “A reform that provides a timely pathway to citizenship without further criminalizing migration would be a huge hit to the industry,” he says.
On the other hand, Libal observed that a bill with increased security measures “could be very profitable” for the industry. Legislators and the Obama administration could adopt a plan that mirrors Republican proposals for an “enforcement first” approach, which include increased police powers, new mandatory detention and sentencing laws, further militarization of the border and proposals for more prisons and detention officers.
Damon Hininger, the chief executive of CCA, sounded an optimistic note when asked about the impact of reform on an investor call earlier this month, noting, “There’s always going to be a demand for beds.”
In recognition of the profits at stake, the prison companies have invested in key legislators leading the reform process—although the companies are coy about their purpose, denying that they are attempting to influence Congress’s deliberations.
Their lobbying efforts are nothing new. CCA and other large private prison companies have forged ties with political insiders by spending huge sums on lobbying firms, campaign contributions and grants to friendly think tanks. An analysis by the Associated Press last year found that the three major private prison corporations—CCA, the Geo Group, the industry’s largest two companies, along with a smaller company, the Utah-based Management and Training Corporation—spent roughly $45 million over the past decade to influence state and federal government.
The private prison industry has cultivated support from Republican leaders on immigration policy, from Senator Marco Rubio, the “face of comprehensive immigration reform,” to the right edge of the House Republican caucus, a review by The Nation has found.
Unlike other stakeholders involved in today’s process, prison companies have stayed away from the headlines, and have told reporters that they are not planning to engage.
Pablo Paez, a vice president for corporate relations with the Geo Group, e-mailed The Nation to say that his company “has never directly or indirectly lobbied to influence immigration policy.” Correction Corporation’s spokesperson, Steve Owen, echoed that position, telling The Nation that his company does not lobby on any “sentencing or detention enforcement legislation” and “will not take a position on or advocate for or against any specific immigration reform legislation nor will our government relations team on our behalf.” Management and Training Corp. did not respond to a request for comment.
Regulatory filings and lobbying documents, however, undercut the industry’s claims of neutrality.
CCA, in a 2011 SEC filing, warned investors that “any changes with respect to drugs and controlled substances or illegal immigration could affect the number of persons arrested, convicted, and sentenced, thereby potentially reducing demand for correctional facilities to house them.”
Last year, disclosures with the Senate show that the company tapped one of its lobbying firms to begin monitoring immigration policy issues.
“Immigration reform laws which are currently a focus for legislators and politicians at the federal, state and local level also could materially adversely impact us,” notes the Geo Group’s 2011 annual report, which specifically cited the “relaxation of criminal or immigration enforcement efforts.”
Both companies may be wary of engaging publicly on immigration reform this year given the backlash over their involvement with recent anti-immigrant laws in the states. In 2010, Arizona enacted SB1070, a measure that centers on a requirement that local police to arrest and charge anyone found without proper immigration documentation. The bill, developed in consultation with private prison lobbyists through a group called the American Legislative Exchange Council, spawned copycat laws in Alabama, Georgia, Indiana, Utah and South Carolina.
Asked on an investor call about the effects of the Arizona law shortly after its passage, Wayne Calabrese, then the chief operating officer of the Geo Group, said, “I think people understand there is still a relatively low threshold of tolerance for people coming across the border and those laws not being enforced.… And that to me at least suggests there’s going to be enhanced opportunities for what we do.”
The association with the wave of state-level enforcement laws—prison companies hired local lobbyists and donated generously to many of the state lawmakers behind the Arizona effort in particular—generated unwanted attention on the industry. It also set off nationwide protests, including a demonstration at the Nashville, Tennessee, headquarters of CCA.
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