Models of Privatization and Public-Private Partnerships

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#1Models of Privatization and Public-Private Partnerships. with Prisons: An Incomplete Survey Dr. Paul Leighton Eastern Michigan University East Asian Law & Society Conference August, 2015 Tokyo, Japan $$$#2Roadmap Dimensions of Privatization • ⚫ Israel US Privatization • Japanese Private Finance Initiative (PFI) Act » Australia Ravenhall - Conclusions This is a slightly expanded version of what was presented at the conference. It adds to a few slides to reflect what was spoken and incorporates some ideas from later conversations about the session.#3Dimensions of Privatization · Legal – and ethical – basis for privatization? • How much privatization? • What functions? How many prisons? What type of control and oversight? New form of prison, or privatize status quo prison? Partnerships • How many? For profit or non-profit partners? $0.#4Israel • Legal and ethical – basis for privatization? - - NO! ✡ 2004 Prisons Ordinance Amendment Law: construct, manage and operate for the first time, a (single) 800 person prison that will be operated and managed by a private corporation rather than by the state. Relieve overcrowding and save money Struck down in 2009 by High Court of Justice#5• Israel II H Academic Center of Law and Business v. Minister of Finance Transfer of powers to a "private profit-making corporation" (emphasis added) that had been selected. • Transfer of powers that, "when exercised, involve a serious violation of the rights to personal liberty and human dignity. These powers include, inter alia, the power to order an inmate to be held in administrative isolation for a maximum period of 48 hours; the power to order the conducting of an external examination of the naked body of an inmate; ... the power to approve the use of reasonable force in order to carry out a search on the body of an inmate."#6• Israel III H Academic Center of Law and Business v. Minister of Finance Powers transferred to guards include "the power to use a weapon in order to prevent the escape of an inmate from the prison, the power given to a policeman to arrest and detain a person without a warrant" [citations omitted]. • Amendment 28 inherently "leads to a violation of the constitutional rights to personal liberty and human dignity of inmates."#7U.S. Nominal privatization: contracting for construction, food, medical care, education 1986: Operational privatization: private company manages a facility owned by the government and/or a prison that the company owns. Geo The GEO Group, Inc. CCA CORRECTIONS CORPORATION OF AMERICA Both are multinational corps, traded on stock exchange. For-profit Real Estate Investment Trusts - pay no federal tax and distribute money to shareholders instead#8U.S. II Overcrowding and "incarceration binge," need more prisons but politicians promise smaller govt/lower taxes I SINCERELY BELIEVE... (WHISPER) THAT GIVEN OUR EXPANDING PRISON POPULATION... ...PRIVATIZED PRISONS ARE OUR BEST OPTION. (WHISPER) $ A.L.EC. Private prisons raised billions from investors seeking to profit from incarceration, disproportionately of minorities INSERT STATE NAME CORRECTI CORPORA AMERICA CAMPAIGN CONTRIBUTIONS POLICY SWAY#9U.S. III •Warehouse prison problem: "there is still too much violence in America's prisons and jails, too many facilities that are crowded to the breaking point, too little medical and mental health care, unnecessary uses of solitary confinement and other forms of segregation, a desperate need for the kinds of productive activities that discourage violence and make rehabilitation possible." (Commission on Safety and Abuse in America's Prisons 2006, p. 390) Private Prisons enable the expansion and maintenance of too many warehouse prisons Cite as: 563 U. S. Mule Creek State Prison Aug. 1, 2008 Opinion of the Court B (2011) 51 1.2008 From Supreme Court decision in Brown v Plata. "Needless suffering and death have been well-documented." (p 3)#10U.S. IV "Endanger democratic processes" · GEO Group, 2010 Annual Report "Risk Factors": "the demand for our services could be adversely affected by the relaxation of criminal or immigration enforcement efforts, sentencing or deportation practices, ... [f] or example, any changes with respect to the decriminalization of drugs." The Intercept_ UNOFFICIAL _SOURCES 21 Lee Fang July 23 2015, 1:49 p.m. Getty Image Private Prison Lobbyists Are Raising Cash for Hillary Clinton As immigration and incarceration issues become central to the See, Buying Access: How Corporations Influence Decision Makers at Corrections Conferences, Trainings, and Meetings (In the Public Interest ([2015]) MARCO RUBIO IS GETTING BIG MONEY FROM FOR-PROFIT PRISON COMPANIES 2016 presidential campaign, lobbyists for two major prison companies are serving as top fundraisers for Hillary Clinton. Corrections Corporation of America and the Geo Group could both see their fortunes turning if there are fewer people to lock up in the future. A A BY JESS SWANSON THURSDAY, JULY 23, 2015 8 DAYS AGO 1.9k 78#11Japan 1999 Act on Promotion of Private Finance Initiative (PFI) (Definition) Article 2 (1) The term "Public Facility etc." as used in this Act means the following facilities (including equipments): (i) Public facility such as roads, railways, ports and harbors, airports, rivers, parks, water services, sewage systems, and industrial water supplies; (ii) Official facilities such as government buildings and accommodation; (iii) Public interest facilities such as public housing, educational and cultural facilities, waste treatment facilities, medical facilities, social welfare facilities, offender rehabilitation facilities, parking, and underground malls; 1 Literal translation of this act is "The Act on Promotion of Provision etc. of Public Facility etc. through Utilization of Private Finance etc." We use the term "PFI (Private Finance Initiative)" because this act is widely known as "PFI Act" in Japan. • Public private . partnerships for "offender rehabilitation facilities" - not prisons • 50 localities wanted one, built 4#12Japan II 3 "pillars" of PFI Shimane Asahi Rehabilitation Center Public-private partnership • Technology and innovation Education, vocational training and rehabilitative programs . Special programs, training and therapeutic gardens for emotionally disturbed inmates • Partnership with community • ⚫ "Co-building" - Center for Regional Engageme Asahi Children's Park Guide Dog Training Center - Visitor Center "aims to create prisons that the public can understand and support" Shimane Asahi website, http://www.shimaneasahi-rpc.go.jp/english/first/index.html#13Japan III All of the inmates at PFI prisons receive some kind of vocational training, compared to only 7.3 % of inmates of other prisons Paul Leighton. 2014. "A model prison for the next 50 years": The high-tech, public-private Shimane Asahi Rehabilitation Center. Justice Policy Journal, 11(1). The treatment procedure for inmates Incarceration Stage1 Stage2 From Shimane Asahi website, http://www.shimaneasahi-rpc.go.jp/english/torikumi/index.html Stage3 Education Release Stage4 Stage5 Collective Rehabilitation Program (4.5 months) *For collective rehabilitation units Victim Understanding Program (3 months) "Other than the above units Program dealing with each inmates problems (3 months) Examples: drugs program, alcohol program, sexual violence program, SST program Social Reintegration Preparation Program Examples: self-help groups, local area participation activities, family meetings, dialogue between victims and assailants, employment support, employment support program etc. Foundation Course (3 weeks) Course Education "only for those eligible Work/Occupational Training Prison Labor Goods manufacturing: metal, wood products, electrical machines and utensils, laundry, off-site farm work, etc Also pre-release guidance (3 days) *For those who will have served their full sentence upon release Pre-release program (2 weeks) *For those to be paroled Occupational Training Foundation Course (all inmates): Basic computing, fundamental business RPG, health and safety, quality control, environmental problems, development of the spirit to want to contribute to society Specialist subjects (only for those eligible): Hairdresser training, nursing, medical office work and construction technician training, electrical engineer, digital content editing, advanced level computer skills, bread baking training, Braille translation#14Japan IV U.S. Japan Government Government Private Sector Company Warden Warden, Treatment, Support & Planning Private & Staff Sector Companies#15Japan V Contract Shareholders Obayasi Corporation Sohgo Security Service CO.LTD Green House CO.,LTD a big No domination by corporation, Banks Mizuho Corporate Bank LTD NEC Corporation Marubeni Corporation Aeon Delight CO.,LTD PHP Design Construct Contract Share Direct Agreement Finance MOJ DCMF Contract SPC Shimane-Asahi Social Support CO.,LTD Insurance Contract but complex structure to manage Management Operation Contract Insurance Office SSJ CO.,LTD Share Management Operation Contract Obayasi Corporation Sohgo Security Service CO.,LTD NEC Corporation Marubeni Corporation Green House CO.,LTD Design Yamashita Sekkei INC Construct Obayasi Corporation IT NEC Corporation Matsushita Electric Industrial CO.,LTD Facility maintenance Gojinsha Keikaku Kenkyusyo Co.,LTD General affairs Gojinsha Keikaku Kenkyusyo Co.,LTD Security Sohgo Security Service CO LTD Food Service,Catering, Laundry Green House CO.,LTD Prison work, Vocational training Obayasi Corporation Education, Classification PHP Obayasi Corporation Medical examination Obayasi Corporation From Akihiko Kimura, The Development of PFI in the Prison Sector in Japan. Presented at the 3rd Annual Meeting for PPP/PFI Promotion Between Japan and Korea#16Australia • NV Existing private prisons generally replicate status quo, but Ravenhall is new form. • $700 million for 1,300 bed near Melbourne opens late 2017 GEO Group (prison operator and equity investor), John Holland (builder), Honeywell (facilities management) and Capella Capital (financial adviser) Partnerships Victoria: Ravenhall Prison Project (2/2015 Summary)#17Australia II || . Ravenhall • УИ NV "It's an unprecedented level of in-prison and post-release programming. This will be unlike any other correctional facility in the world." GEO CEO Zoley, Q2 2014 earnings call* • Ravenhall will have "collaborative partnerships with community-based organizations, which will allow offenders' release from custody to continue. rehabilitation programs. Progressive accommodation units [and] ... innovative use of in-cell IT-delivered programming.” GEO CEO Zoley, Q3 2014 earnings calls Incentive fee to reduce recidivism rates: GEO promised a $2 million bonus payment if it cuts recidivism at Ravenhall by 12 per cent per year, compared to the overall Victoria prison system. Work starts on new 1,000-bed Ravenhall Prison in Melbourne, as prison population grows *PR hyperbole, although this model is a move in the right direction#18. . Conclusions Because we have them does not make them legitimate No for-profit police (private security have no power to arrest, use deadly force) No for-profit courts (arbitration lacks enforcement and can usually appeal to court) Why are for-profit prisons morally acceptable then? Limits, even when acceptable: ⚫For-profit executions? •For-profit business runs whole state or national prison system?#19Conclusions II State sometimes fixed or limited in how it manages, so some degree of privatization necessary to create a new model. PATRICE DUMP PRISONSTOCK INVEST IN HUMANITY But, privatized prison and punishment most problematic when state contracts out core management function to for-profit business (esp large corporation)#20Conclusions III Public-private partnerships that emphasize rehabilitation undercut the objection that private interests "profit from misery." But larger objection is creation of "bodies destined for profitable punishment". Campaign contributions • Political lobbying Economies of scale (encourage bigness) Perverse incentives Mis-allocation of capital Prison Budgets & Policies Follow The Money CEO 7#21Conclusion IV Privatization requires mechanisms for state to oversee business and hold them accountable. ● ● ● ● Government should keep control of key management positions. Contracts need to be made public (accountability of politicians) Contracts need to be well written and comprehensive Effective oversight PUBLIC PRIVATE K ● Penalties greater than profit from PART wrongdoing#22Conclusion V . . Financial savings is not a moral justification for privatization, which worsens problems of inequality. Savings overstated because of industry-funded research and PR. Any savings comes at expense of worker pay and salaries. • "A lot of jobs in government are middle-class jobs that in the private sector are not middle-class jobs. People aren't willing to support conditions for public workers that they themselves no longer enjoy." John Donahue, Kennedy School of Government at Harvard University Private GEO CEO = $6 million (2012) Public Dept of Corrections Director = less than $200,000 Guard = $39,040 $30,460 (2010) (2010) Salary only, does not include the value of benefits. From Barak, Leighton and Cotton, Class, Race, Gender & Crime, 4th ed (from Securities and Exchange Commission and Bureau of Labor Statistics data)#23Dr. Paul Leighton is a Professor in the Department of Sociology, Anthropology & Criminology at Eastern Michigan University. He is the co-author of Punishment for Sale: Private Prisons, Big Business and the Incarceration Binge. More information: http://paulsjusticepage.com/paul/pauls-cv.htm See also: The Problems With Private Prisons, http://www.paulsjusticeblog.com/2013/04/the_problems with_private_prisons.php Prison Privatization in the U.S. and Japan http://www.paulsjusticeblog.com/2014/06/we need a postwarehouse prison.php Why Private prisons Do Not Save Money http://www.paulsjusticeblog.com/2014/10/why_private_prisons_do_not_save_money.php

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