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Privatize prisons, unlock savings
By:
Geoffrey F. Segal
Government reform expert and author David Osborne says “the fastest way to save
money and increase value is to force public institutions to compete.” Yet when
political leaders try to introduce competition into the public sector, they are
often met with stiff resistance.
For example, opponents are challenging plans by John Rees, commissioner of
Kentucky’s Department of Corrections, to allow private firms to bid for prison
food services. This is not a new idea; 17 states already contract for food
services in their prisons.
Union officials and politicians also are using the occasion to fight Gov. Ernie
Fletcher’s proposal to privatize a new prison facility in Elliott County. With
the 14 existing state prisons reporting hundreds of empty beds at the end of
June, Fletcher argues that Kentucky taxpayers should not be burdened down with
another prison.
He rightly points out that privatizing the prison would bring in much-needed
revenue by providing space to house inmates from other states. But opponents
predictably argue that the state should go ahead and open the prison simply
because it will bring jobs to a poor county.
The Lexington Herald-Leader’s editorial writers note the fallacy of prison
construction and operation as economic development.
“It is easy to sympathize with those in Elliott County who think they were
promised these state jobs,” said a recent Herald-Leader editorial. “But it is
foolish for Kentucky to continue to invest in an outmoded development strategy,
and call it progress.”
Union officials representing state prison guards and the politicians who support
them vehemently condemn any suggestion of privatizing prisons by suggesting that
inmates will not be treated properly and taxpayers will not save money.
Actually, union members and their political pals are afraid the governor’s plan
will save money, provide adequately for inmates and turn up the heat on
Kentucky’s state-owned prisons.
The evidence seems to support their fears. More than half of states use private
prisons because they offer lower costs.
Research by the Reason Foundation identifies 28 studies comparing the cost of
government prisons with their private counterparts that house 150,000 inmates
across the country. Twenty-two of the studies conclude that private prisons cost
taxpayers an average of 15 percent less than state facilities while six found
the costs to be about the same. None of the reports found that private prisons
are more costly.
It’s not surprising that the research also shows that states that use private
prisons also tend to see costs fall in their government-run penal institutions.
Competition drives prices down - whether you’re talking about grocery stores or
prisons.
It’s also not shocking that the trend toward privatizing services is expected to
continue. A recent survey by the Council of State Governments reported that
corrections officials expect contracting to increase in the next five years.
Time and again, critics clamor about the supposed poor quality of private
prisons and contracted services. Yet eight out of nine studies identified by the
Reason Foundation found that private prisons rank as high or higher in quality
of care than their state-run counterparts.
Besides, do we really think that the incidents union officials point to as
diminishing the quality of private facilities don’t also happen in publicly
operated prisons? All prisons must deal with inmate fights, rapes and attacks on
guards.
The difference is that when chaos occurs in private prisons, employees lose
their jobs and the facility is held responsible. Private corrections companies
sometimes go out of business for failing to keep order.
When is the last time a government-run prison was shut down because a situation
was handled poorly? Private prisons simply are more accountable than government
facilities.
Opponents of privatization also express doubts about the training and wages of
private prison employees. This concern does emphasize the need for sound
contracts that clearly delineate pay, benefits and responsibilities.
Contracts give state officials power over how prison staffs are trained and
their pay and benefit packages.
The truth is, most of the training required by private prison staffs goes beyond
what the state requires for the staffs of government facilities. And while very
few companies can compete with the taxpayer-backed benefit packages offered by
the state, it stands to reason that private firms will prefer trained and
experienced personnel in order to get their contracts renewed.
Allowing supply and demand to work will ensure that skilled guards and capable
administrators will still be able to land jobs with good pay and adequate
benefits. On the other hand, private prisons that try to get by with
inexperienced or poorly trained staffs face the possibility of being shut down.
That’s the way it should be.
Privatizing prisons is not just common sense; it’s sound policy that will unlock
savings for taxpayers, provide for proper treatment of inmates while maintaining
security for our Commonwealth.
Geoffrey F. Segal is the director of privatization and government reform at
the Reason Foundation in Los Angeles and an adjunct scholar at the Bluegrass
Institute http://www.bipps.org/
The Bluegrass Institute is an independent research and
educational institution offering free-market solutions to Kentucky's most
pressing problems.
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