HomeLatest ThreadsGreatest ThreadsForums & GroupsMy SubscriptionsMy Posts
DU Home » Latest Threads » Forums & Groups » Topics » Economy & Education » Economy (Group) » Weekend Economists and th... » Reply #4

Response to Demeter (Original post)

Fri Jun 22, 2012, 06:05 PM

4. Prisons, Privatization, Patronage By PAUL KRUGMAN

 

http://www.nytimes.com/2012/06/22/opinion/krugman-prisons-privatization-patronage.html



Over the past few days, The New York Times has published several terrifying reports about New Jersey’s system of halfway houses — privately run adjuncts to the regular system of prisons. The series is a model of investigative reporting, which everyone should read. But it should also be seen in context. The horrors described are part of a broader pattern in which essential functions of government are being both privatized and degraded.....You might be tempted to say that it reflects conservative belief in the magic of the marketplace, in the superiority of free-market competition over government planning. And that’s certainly the way right-wing politicians like to frame the issue. But if you think about it even for a minute, you realize that the one thing the companies that make up the prison-industrial complex — companies like Community Education or the private-prison giant Corrections Corporation of America — are definitely not doing is competing in a free market. They are, instead, living off government contracts. There isn’t any market here, and there is, therefore, no reason to expect any magical gains in efficiency.

And, sure enough, despite many promises that prison privatization will lead to big cost savings, such savings — as a comprehensive study by the Bureau of Justice Assistance, part of the U.S. Department of Justice, concluded — “have simply not materialized.” To the extent that private prison operators do manage to save money, they do so through “reductions in staffing patterns, fringe benefits, and other labor-related costs.” So let’s see: Privatized prisons save money by employing fewer guards and other workers, and by paying them badly. And then we get horror stories about how these prisons are run. What a surprise!

So what’s really behind the drive to privatize prisons, and just about everything else?

One answer is that privatization can serve as a stealth form of government borrowing, in which governments avoid recording upfront expenses (or even raise money by selling existing facilities) while raising their long-run costs in ways taxpayers can’t see. We hear a lot about the hidden debts that states have incurred in the form of pension liabilities; we don’t hear much about the hidden debts now being accumulated in the form of long-term contracts with private companies hired to operate prisons, schools and more. Another answer is that privatization is a way of getting rid of public employees, who do have a habit of unionizing and tend to lean Democratic in any case.

But the main answer, surely, is to follow the money. Never mind what privatization does or doesn’t do to state budgets; think instead of what it does for both the campaign coffers and the personal finances of politicians and their friends. As more and more government functions get privatized, states become pay-to-play paradises, in which both political contributions and contracts for friends and relatives become a quid pro quo for getting government business. Are the corporations capturing the politicians, or the politicians capturing the corporations? Does it matter? Now, someone will surely point out that nonprivatized government has its own problems of undue influence, that prison guards and teachers’ unions also have political clout, and this clout sometimes distorts public policy. Fair enough. But such influence tends to be relatively transparent. Everyone knows about those arguably excessive public pensions; it took an investigation by The Times over several months to bring the account of New Jersey’s halfway-house-hell to light.

MORE DETAIL AT LINK

Reply to this post

Back to OP Alert abuse Link to post in-thread

Always highlight: 10 newest replies | Replies posted after I mark a forum
Replies to this discussion thread
Arrow 76 replies Author Time Post
Demeter Jun 2012 OP
Demeter Jun 2012 #1
Demeter Jun 2012 #2
Demeter Jun 2012 #11
Demeter Jun 2012 #13
Demeter Jun 2012 #20
Demeter Jun 2012 #3
LineReply Prisons, Privatization, Patronage By PAUL KRUGMAN
Demeter Jun 2012 #4
Demeter Jun 2012 #5
Demeter Jun 2012 #7
Demeter Jun 2012 #8
Demeter Jun 2012 #6
Demeter Jun 2012 #16
Demeter Jun 2012 #17
Po_d Mainiac Jun 2012 #22
westerebus Jun 2012 #45
Demeter Jun 2012 #46
westerebus Jun 2012 #68
Po_d Mainiac Jun 2012 #58
westerebus Jun 2012 #67
Demeter Jun 2012 #9
Demeter Jun 2012 #10
Demeter Jun 2012 #12
Demeter Jun 2012 #14
Demeter Jun 2012 #15
Demeter Jun 2012 #18
Demeter Jun 2012 #19
Demeter Jun 2012 #21
Demeter Jun 2012 #23
Demeter Jun 2012 #24
Demeter Jun 2012 #25
Demeter Jun 2012 #26
xchrom Jun 2012 #27
DemReadingDU Jun 2012 #29
Demeter Jun 2012 #33
xchrom Jun 2012 #34
Tansy_Gold Jun 2012 #59
Demeter Jun 2012 #35
DemReadingDU Jun 2012 #38
Demeter Jun 2012 #40
Fuddnik Jun 2012 #44
Fuddnik Jun 2012 #42
DemReadingDU Jun 2012 #43
DemReadingDU Jun 2012 #28
Demeter Jun 2012 #36
Tansy_Gold Jun 2012 #60
xchrom Jun 2012 #30
Demeter Jun 2012 #32
xchrom Jun 2012 #31
Demeter Jun 2012 #37
Demeter Jun 2012 #39
Demeter Jun 2012 #41
Demeter Jun 2012 #47
Demeter Jun 2012 #48
Demeter Jun 2012 #49
westerebus Jun 2012 #69
Demeter Jun 2012 #65
Demeter Jun 2012 #50
Demeter Jun 2012 #51
Demeter Jun 2012 #52
DemReadingDU Jun 2012 #56
Demeter Jun 2012 #53
Fuddnik Jun 2012 #55
Po_d Mainiac Jun 2012 #57
Hotler Jun 2012 #71
Demeter Jun 2012 #72
Fuddnik Jun 2012 #54
Ghost Dog Jun 2012 #61
Demeter Jun 2012 #62
Ghost Dog Jun 2012 #63
Demeter Jun 2012 #66
Fuddnik Jun 2012 #70
Demeter Jun 2012 #73
Fuddnik Jun 2012 #75
Demeter Jun 2012 #64
Demeter Jun 2012 #74
Demeter Jun 2012 #76
Please login to view edit histories.