Privatization

Postcard from Arizona to John Roberts: Money Corrupts

In a week in which the Supreme Court turned a blind eye to the reality of money corrupting politics, a story out of Arizona provides a clear example of the insidious influence of the private prison industry and its campaign contributions. 

Arizona has been at the forefront of bad prison policy and big profits for private prison companies. People For the American Way’s 2012 report, “Predatory Privatization: Exploiting Financial Hardship, Enriching the One Percent, Undermining Democracy,” explored how Arizona officials’ political and ideological commitment to prison privatization overrode good policy and common sense. Unbelievably, faced with evidence that privately run prisons were costing taxpayers more, not less, than state-run prisons, some legislators moved to stop the state from collecting the data.

This February, we wrote about Politico’s coverage of the private prison racket. “Companies that manage prisons on our behalf have abysmal records,” author Matt Stroud asked, “So why do we keep giving them our business?” One answer is that the industry spends a fortune on lobbying and campaign contributions.

This week’s story shows how those investments can pay off. According to the Arizona Republic, House Appropriations Committee Chairman John Kavanaugh tried to slip a last-minute $900,000 earmark for private prison giant GEO Group into the state budget. The company is already expected to get $45 million this year under contracts with the state that guarantee the company at least a 95 percent occupancy rate, “virtually ensuring the company a profit for operating its prisons in Arizona.” The state Department of Corrections said the extra money isn’t needed, but Kavanaugh heard otherwise from the company’s lobbyists. GEO executives gave Kavanaugh more than $2,500 in 2012.

The good news is that the Senate Appropriations Committee dropped the extra funding “following an uproar of criticism from Arizonans.”

PFAW

Public Turning Against the Private Prison Racket

PFAW’s 2012 report, “Predatory Privatization: Exploiting Financial Hardship, Enriching the One Percent, Undermining Democracy,” included a section titled, “The Pernicious Private Prison Industry.” We reported that across the country, private prisons were often violent, poorly run facilities that put prisoners, employees and communities at risk even while failing to deliver on promised savings to taxpayers. But state legislators, encouraged by ALEC and by private prison interests’ lobbying and campaign expenditures, continued to turn prisons over to private corporations, often with contract provisions that acted as incentives for mass incarceration.

A new story in Politico Magazine, “The Private Prison Racket” comes to the same conclusions. “Companies that manage prisons on our behalf have abysmal records,” says author Matt Stroud. “So why do we keep giving them our business?”

The Politico story slams “bed mandates” – guarantees given by states to private companies to keep prisons full.  Contracts like that build in incentives for governments to lock people up – and punish states financially when they try to reduce prison populations.

Politicians are taking notice. Last month, In the Public Interest reported that reality has turned the tide against private prisons: “Coast-to-coast, governments are realizing that outsourcing corrections to for-profit corporations is a bad deal for taxpayers, and for public safety.” The dispatch cited problems with private prisons in states as diverse as Arizona, Vermont, Texas, Florida, and Idaho, where Gov. Butch Otter, a “small government” conservative, announced last month that the state would take control of the Idaho Correctional Center back from private prison giant Corrections Corporation of America due to rampant violence, understaffing, gang activity, and contract fraud.

But the huge private prison industry is not going away anytime soon. As In the Public Interest notes:

All of this momentum does not suggest the imminent death of the for-profit prison industry. Some states, including California and West Virginia, are currently gearing up to send millions more to these companies. But the past year has been a watershed moment, and we are heading in the right direction. In light of these developments, these states would be wise to look to sentencing reform to reduce populations, rather than signing reckless outsourcing contracts.

The arguments against private prisons are myriad and compelling. Promised savings end up as increased costs. Lockup quotas force taxpayers to guarantee profits for prison companies through lock up quotas hidden in contracts. They incentivize mass incarceration while discouraging sentencing reform in an era when crime rates are plummeting.

But more than anything else, the reality of the disastrous private prison experiment has turned the public against the industry.

 

PFAW

New Poll Shows Overwhelming Opposition to Private School Vouchers

The annual PDK/Gallup poll records the highest level of opposition to private school vouchers in the survey's history.
PFAW

Tony Perkins' Scary Back-to-School Message

The fear-mongering in the Family Research Council’s latest mailing starts on the envelope:  “Beginning THIS MONTH…they don’t want any American child to escape. Read how we can STOP them.”

“They” turns out to be “government-run schools” and the “radical” teachers that infest them.

If a foreign enemy had plotted to infiltrate America, I’m not sure an army of undercover subversives could have done more damage than our government-run schools….

Leftists don’t want a single American child to escape their thought control.  And they are crowding out true education.

Of course, Perkins has a skewed idea about what a “true education” includes. He complains that America used to be the tops in science – after all we put a man on the moon. But not any more:

Today’s science classes often feature big-government political propaganda, taking time and focus away from true science. Not to mention attacks on the Bible and arrogant censoring of any theories like intelligent design that challenge their Darwinism.

Yes, nothing will boost American students’ science scores faster than a little the-universe-is-6000-years-old Creationism. Perkins doesn’t say exactly what big-government propaganda he’s talking about. Evolution? Astronomy? Climate change?

Even worse, says Perkins, “the federal government has endorsed and sponsored an ‘anti-bullying program’ created and run by Dan Savage, a radical homosexual activist…” Perkins thinks sex education is all about promoting promiscuity and homosexual behavior. “This obsession with liberal sex ‘education’ shows how the minds and souls of our young people are being deliberately sabotaged.”

Accompanying Perkins’ letter is a “Protect America’s Children Survey” which asks whether their local schools are experiencing a range of problems, including “Positive portrayals of homosexuality or negative portrayals of those who don’t affirm homosexuality,” “Not enough teaching of the Christian roots of America,” “Absence of presentation of intelligent design theory,” and “Not enough teaching on the virtues of limited government and free enterprise.”

There is hope, says Perkins, bragging that he was able to “assist” Louisiana Gov. Bobby Jindal in passing “one of the most family-friendly school choice laws in America.” Jindal’s privatization scheme has resulted in public money being diverted into often  unaccountable schools wasting taxpayer dollars and teaching Religious Right curricula – no wonder Perkins loves it. 

Prison Privatization: Reality vs. 'Magic of the Marketplace'

People For the American Way’s 2012 Right Wing Watch In Focus report, “Predatory Privatization,” included a section on the pernicious private prison industry. The report documented that, for all the talk of efficiency and accountability among lawmakers pushing privatization, the evidence pointed to a different reality: private prisons often deliver worse service, at higher costs to the taxpayer, with little accountability. One reason: massive spending by prison corporations on lobbying and political contributions.

Today, Think Progress points to new evidence: a sordid tale of prison privatization in Ohio. It links to a timeline produced by the ACLU of Ohio that chronicles the abysmal record of the Lake Erie Correctional Institute in the 18 months since Ohio sold the prison to the Corrections Corporation of America.

In that short period, the prison flunked two inspections, with independent reports documenting “filthy, broken facilities, as well as much higher rates of crime and violence in and around the prison.”

What about accountability? Think Progress notes:

Despite Lake Erie’s multiple violations of state standards, Ohio has stubbornly maintained its infatuation with private prisons. The state plans to outsource prison food to Aramark, a private vendor already under investigation in Kentucky for multiple contract violations, including serving old food that had not been stored properly and overbilling the state.

Republican-dominated state legislatures are all too eager to ignore the private prison industry’s dismal record. CCA and other companies like GEO are paying well to maintain their massively profitable government contracts; the industry spent $45 million on lobbying in the past decade. CCA has done especially well for itself, rebounding from near bankruptcy in 2000 to rake in a net income of $162 million in 2011.

PFAW

Mitt Romney's Revealing Comments About FEMA

Even when it comes to disaster relief, Romney is not one to allow the public welfare to get in the way of corporate profits.
PFAW

Arizona Prison Privatization: Ideology and Influence Trump Evidence

At 6:00 p.m. on the Friday before Labor Day weekend, Arizona officials announced the granting of a multi-million dollar contract to Corrections Corporation of America, a private prison giant, for the operation of one thousand medium security prison beds.  The grant was not exactly a big surprise; CCA had hired as lobbyists people close to Gov. Jan Brewer.

What should be more surprising is that officials are arguing with a straight face that the deal is good for taxpayers, in spite of evidence to the contrary.  As the Arizona Republic reported,

The contract calls for CCA to be paid a per diem rate of $65.43 per bed. The most recent information available shows the average daily cost per inmate in a state-run medium-custody facility in 2010 was $48.42. The award to CCA is 35percent more than what it cost the state to house and monitor inmates two years ago.

Unfortunately for taxpayers, Arizona officials have repeatedly demonstrated their willingness to tap taxpayers in order to advance an anti-government ideology and boost the profits of a company that is generous with its spending on lobbying and campaign contributions. 

 

People For the American Way Foundation’s recent report “Predatory Privatization” noted that private prisons in Arizona cost the state as much as $7 million more in 2009 and 2010 than units operated by the state department of corrections.  The report also noted CCA’s aggressive expansion plans:

Earlier this year, CCA wrote to officials in 48 states offering to buy and run prisons if states would guarantee a 90 percent occupancy rate. A coalition of religious groups urged state officials to turn down the offer, which the groups said would create an incentive for mass incarceration and “be costly to the moral strength of your state” as well as costly financially.

 

 

PFAW Foundation

Predatory Privatization: Exploiting Financial Hardship, Enriching the 1%, Undermining Democracy

The combination of state and local budget crises and the 2010 election of anti-government ideologues in many states has left taxpayers and communities increasingly vulnerable to predatory “privatization” of government services and public infrastructure.

PFAW Report: Predatory Privatization Puts Citizens and Communities at Risk

 Washington, DC -- State and local budget crises and the election of anti-government ideologues have left taxpayers and communities increasingly vulnerable to predatory “privatization” of government services and public infrastructure. “Desperate government is our best customer,” says one finance company executive specializing in the privatization of public infrastructure. A new report from People For the American Way documents that the push to privatize public services and assets often reduces the quality of services, burdens taxpayers and threatens democratic government.

A copy of the full report, Predatory Privatization: Exploiting Financial Hardship, Enriching the One Percent, Undermining Democracy [pdf] is available here: http://site.pfaw.org/pdf/Predatory-Privatization.pdf

“The combination of budget deficits, anti-tax ideology, and financial predators can be deadly to the interests of citizens and communities,” said People For the American Way President Michael Keegan. “Right-wing anti-government and anti-union ideologues are exploiting tough economic times and taking advantage of desperate public officials. The public picks up the tab but gives up control and accountability. The public good should never be on the auction block. If citizens are not vigilant, they will end up paying a terrible long-term price for deals to plug short-term budget holes. ”

Among the examples examined in Predatory Privatization:

  • In 2009, the city of Chicago sold revenues from the city’s parking meters to a group of companies led by Wall Street giant Morgan Stanley. Investors got the right to control parking meter revenues for 75 years. Not only did the city give up revenue, but it actually has to pay the private company whenever a street is closed for repairs or for a street fair; the company claims city taxpayers already owe it almost $50 million.
  • Republican officials are pushing to privatize more prison operations, even though private prisons often end up costing taxpayers more. The multi-billion-dollar private prison industry has an incentive to increase the numbers of prisoners incarcerated and to keep people locked up as long as possible – and spends millions to lobby state legislators.
  • Investors are lining up – and lobbying legislators – to get their hands on the billions of dollars spent on public education. Many schools are being privatized despite very mixed results. Many investors rake in millions even though many students in these private schools do much worse than their traditional counterparts.
  • Indiana turned over its toll road to foreign firms for 75 years. Fine print in the contract has required taxpayers to reimburse investors when Indiana waived tolls for safety reasons during a flood. The contract allows the company to raise tolls every year; they doubled during the first five years of the 75-year contract.


The report also gives individuals advice on how to protect the public interest by responding strategically to privatization schemes, including a set of crucial questions that public officials should be forced to answer before voting on any proposal.

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Gina Raimondo's Curious Speech at the Manhattan Institute (VIDEO)

Rhode Island Treasurer Gina Raimondo appeared at the Manhattan Institute on Thursday to receive that organization’s Urban Innovator Award. Raimondo was being recognized for her efforts to reform the state’s public pension plans. While Raimando is not the first Democrat to receive the award, her appearance at the right-wing think tank is likely to raise eyebrows back home because of what she said and where she said it.
 
For instance, in response to a question from Charles Brunie – a founder of Oppenheimer Capital and former chairman of the Manhattan Institute – Raimondo seemed to indicate that she’s open to privatizing, or selling outright, state assets. She also suggested that, due to her private sector background, she outworks lawmakers and other public servants and employees at the state house.
 
To be sure, the substance of Raimondo’s speech was the importance of core government services and the need to sustain them financially for future generations. She highlighted Rhode Island’s pension reforms as proof that government can work and closed by arguing that the debate over whether government is too big should be supplanted by a debate over whether government is effective. However, the venue for her speech raises questions.
 
The Manhattan Institute, perhaps best known as the “brain trust” of the Giuliani administration in New York, has a long history of working to privatize, undermine, and cut public schools, social services, and public transportation. These are the very services that Raimondo cited as essential in her life and to all citizens of Rhode Island.
 
More broadly, the Manhattan Institute pushes a right-wing agenda that is only partially obscured by the intellectual veneer it projects on its work. Whether it’s equal rights for gays and lesbians, immigration reform, equality between men and women, or affirmative action for minorities, the Manhattan Institute is working against it. In fact, the think tank’s best known “scholar” is Charles Murray, co-author of the discredited Bell Curve, which claimed a genetic link between race and IQ – e.g. blacks are genetically less intelligent than whites.
 
It is unclear what Raimondo hoped to accomplish by accepting the award. The motivations of the Manhattan Institute, however, are far less opaque. Their aim is to cut government spending on social programs – not to make it more effective – but rather to achieve their utopian free market vision of society. Partnering with a Democrat like Raimondo enables them to put forward a reasonable, bi-partisan face. The day after her speech, no less than the Wall Street Journal editorial page – no fan of Democrats or government – heaped praise on the treasurer for leading the Rhode Island “miracle.”
 
You can watch selected clips below and the full speech on the Manhattan Institute’s Public Sector Inc. website.
 
Intro video featuring Dick Cheney praising the Manhattan Institute’s “fresh thinking”:

Raimondo on getting locked in the state house:

Raimondo Q&A with Charles Brunie:

Raimondo on the importance of government:

Privatization of Public Education: A Joint Venture of Charity and Power

When good people give their own money to a child in need, the best of the human spirit is
revealed. When our nation writes its laws and public policies, the spirit of the nation must be
reflected in order to care for all children. The decisions we make today about the best way to
educate our children must be conducted in the full knowledge that these decisions will shape our
children’s future and our future as a nation.

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