What's Better Than Two Private Prison Companies? One Big One!

by Matt Kelley · 2010-04-26 06:43:00 UTC
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One of the country's most notorious prison mercenaries just got bigger. GEO Group — already the nation's second-biggest private prison company — has announced that it plans to buy another private prison group, the Cornell Companies. Sound like good news to you?

The deal's valued at $685 million and is already raising eyebrows, with observers wondering whether the Cornell board failed to get the best price it could, and whether rating agencies will downgrade GEO for the additional debt it had to take on to complete the deal.

Why would GEO take on more debt to make the sale? The answer has grim implications for all of us. GEO wants to own an even more aggressive stake in the booming incarceration business because the company sees the potential to lock up thousands more in the years ahead. GEO can feel confident about the matter because it's hardly a passive actor. The company, for example, is lining Republican pockets in Congress and some states to keep the nation's prisons packed through tough sentencing and immigrations laws.

The company also thinks it can continue to drive down costs as it grows.

But for the rest of us, this deal means that the pool of private prison operators just got a lot smaller, and the keys to hundreds of thousands of cells in this country are now sitting in even fewer hands. Right now, 9% of federal and state prisoners are in private facilities, but a shocking 50% of new prisoners in many states are locked into the revenue stream of companies like GEO and its competitor, the Correction Corporation of America.

As private prison operators like GEO expand their operations, and as states increasingly outsource incarceration, it's more critical than ever to ensure that the companies are training their guards and providing adequate physical and mental health care.

Unfortunately, despite the nation's greater appetite for reform, GEO knows that the U.S won't be shrinking its prison system anytime soon. Even if we were to add a dose of sanity to our criminal justice policy, Arizona's horrendous new immigration law is just one sign that we'd continue filling cells with yet another target — undocumented immigrants.

Photo Credit: GEO Group

Matt Kelley is the Online Communications Manager at the Innocence Project and a graduate of the Medill School of Journalism at Northwestern University. Follow him on Twitter @mattjkelley.
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