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Wednesday, August 7, 2013

Immigration Reform Could Mean Windfall For Private Prisons

Corrections Corporation of America (CCA) detention center in Elizabeth, N.J., that the private prison contractor runs for the government, is seen Wednesday, Dec. 10, 2008. Inside, immigrants are detained indefinitely, some for months and years, while the government decides what to do with them. (Mel Evans/AP)

Corrections Corporation of America (CCA) detention center in Elizabeth, N.J., that the private prison contractor runs for the government, is seen Wednesday, Dec. 10, 2008. Inside, immigrants are detained indefinitely, some for months and years, while the government decides what to do with them. (Mel Evans/AP)

Members of Congress are in their home districts until later this fall, but that doesn’t mean they’re able to escape the issues on Capitol Hill.

Immigration reform is one of those issues following them back home. Advocacy groups and their opponents around the country are staging protests and events to highlight the issue.

But one potential side effect of immigration reform is getting overlooked: private prisons stand to make a lot of money.

Patrick O Connor, a reporter for the Wall Street Journal, tells Here & Now that the companies that run private prisons started benefiting as early as 2005, when changes were made in the way people were prosecuted, under a program called Operation Streamline.

The program shifted people into the federal system instead of going through the civil system, or simply being deported.

“A lot more people are in prison than had been before on immigration charges, and the companies are the direct beneficiaries of those policies,” O’Connor said.

Immigration reform, as it was passed by the Senate, would create another windfall for the two major private prison companies in the U.S., Corrections Corporation of America and the GEO Group.

While immigration reform would decriminalize the population inside the United States, border control would be strengthened.

Any legislation coming out of the House would likely call for even stronger border control than the Senate version.




Today legislators and businessmen from both the U.S. and Mexico are meeting in El Paso, Texas, to discuss, among other things, immigration reform. The U.S. Senate has passed a comprehensive reform bill; the House has not. But members of Congress are hearing about the issue right now from constituents and advocacy groups during the August recess.

This month's lobbying is being seen as crucial to the chances of an immigration overhaul, and one industry that is very invested in the bill is the private prison industry. Here to explain is Patrick O'Connor, who has been covering that part of the story for The Wall Street Journal. He's with us from NPR headquarters in Washington.

And Patrick, tell us first of all about the companies that stand to benefit from immigration reform. There are two big ones.

PATRICK O'CONNOR: Well, Corrections Corporation of America and the GEO Group are the two largest privately operated prison facilities in the country. They do a lot of work with the federal government. Both have revenues in excess of a billion dollars a year, and they look like they stand to benefit quite a bit from immigration legislation that passed the Senate earlier this year and presumably anything that would come out of the House.

HOBSON: And why is that?

O'CONNOR: Because one of the things to keep in mind is that yes there will be a portion of the population whose just being here will be decriminalized, but the legislation also is going to crack down on those folks who are here illegally, who already have felonies or have been in the criminal system, and then the Congressional Budget Office and others have said that even the increased enforcement is still going to allow about half, if not more, of the people who try and come to the country illegally still to get in.

So the bills being debated in Congress would only address people who are already here, and there will be a pretty steady flow of people coming into the country no matter what Congress does.

HOBSON: And we should mention that immigration violations are right now the number one source of incarceration in the U.S.

O'CONNOR: Yeah and have been for the last four years, and that's a major uptick since 2005, which essentially is when Congress first started to deal with the immigration issue. The Bush administration back in 2005 created a program called Operation Streamline, where they started to prosecute people federally that had been prosecuted in the civil system or just deported from the country. The federal prison population has skyrocketed as a result.

HOBSON: Now how big a role did these two companies play in shaping the bill that came out of the Senate? Because I do see that they have denied that they've been directly or indirectly lobbying to influence immigration policy. That's what the GEO Group spokesman said.

O'CONNOR: Yeah, I mean to hear them tell it, they have had no impact whatsoever on any immigration that's come out of Congress or state legislatures for the last decade. If you were to look at their lobbying spending, they clearly are spending a lot of time talking to lawmakers about not necessarily the immigration issue but incarcerations.

They say what they're doing is they're just trying to sell politicians on the services that they provide and not try and influence legislation, although we did get the GEO Group to acknowledge that they had successfully lobbied to have a pilot program included in the Senate bill, which is an alternative detention program.

So, you know, they've acknowledge that small provision, but as far as pushing a bill on the Hill, they say they have no fingerprints on anything.

HOBSON: And yet I see that the industry's donations have most benefitted senators including McCain and Rubio, two staunch proponents of immigration reform.

O'CONNOR: Yeah, actually the firm that was lobbying for that provision I just referred to is actually founded by Rubio's current chief of staff. So, you know, these guys have been smart. I mean, they've been giving the money to the people who have been supporting their causes.

I think the Associated Press tallied their combined political giving and lobbying spending, both at the federal and state level over the decade, I think it was $45 million. They say they're not spending the money to influence what the policy looks like, but they're certainly spending a lot of money.

HOBSON: Now private prisons are not the only game in town. Why are they so important in the immigration battle?

O'CONNOR: Well because they're really the people who are detaining the bulk of folks who get ensnared in immigration violations. I think by some estimates they're taking as many as 80 percent of all people who are arrested on immigration violations. So they may not be the only game in town, but they really are the I guess major growth area.

The House Judiciary Committee passed a bill earlier this summer that essentially requires ICE to either build new facilities or contract with outside entities to build new facilities. So, you know, these are the guys who are dealing with the most of the flow.

We've focused a lot on enforcement. Republicans on the Hill and Democrats, even the president, have said that any bill that Congress passes has to address enforcement, both blocking new immigrants from coming across the border and tracking down people who are here, but not as much attention has been paid on where those people are going and who stands to benefit from just the fact that we're now processing 400,000 people, roughly, each year on immigration violations at the federal level.

HOBSON: Patrick O'Connor, reporter for the Wall Street Journal, on the gains that private prisons stand to make from immigration reform. We'll take a break, and when we come back, we'll hear about congressional Republicans' role in driving the trend.


Meanwhile news we're noting, yesterday in Shanghai temperatures hit 105 degrees. Thousands there have gone to the hospitals for care. They'll be covering that later today on ALL THINGS CONSIDERED. Back with Jeremy's look at prisons and immigration in a minute - HERE AND NOW.


HOBSON: We're back with our conversation about how private prisons stand to gain from immigration reform with Wall Street Journal reporter Patrick O'Connor. And Patrick, you report that under the legislation approved by the Senate, the federal prison population would increase by 14,000 inmates annually. How big is the industry now compared to say 10 years ago?

O'CONNOR: It's exploded. In 2005, CCA made somewhere in the range of seven or eight percent of their revenue was derived from ICE contracts. It's now about 12 percent. For GEO Group it was five percent in 2005, and it's now 14 percent. So this has been a big driver for their bottom line.

And actually one of the really interesting things to keep in mind regarding the industry is that they basically began in the mid-'80s, and immigration was their kind of first business. CCA I think was started in 1983 or 1984, and their first facility was a detention processing facility for the Immigration and Naturalization Service, now known as ICE.

I guess in the late '80s and most of the '90s, their big growth model was to go to state governments and say hey, we can run your prisons for you cheaper than you can. But a lot of subsequent studies have shown that that's not really the case, and state prison populations are dwindling nationally. So their big growth over the - since 2005 but really over the last decade has been federal immigration detentions.

HOBSON: And as they have increased their presence, there are a lot more people being detained.

O'CONNOR: Yeah, it's not something that we pay a ton of attention to. I was talking to a defense lawyer in Arlington, Virginia, who was telling me that it's not uncommon for her to get someone who's maybe arrested for a traffic violation in Loudon County, they spend three months awaiting a federal trial when this person would normally be processed out in a couple days.

Then they have to do some federal time, and then they can wait six, eight, nine months to wait to be deported. That whole time, the federal government is paying for those people to be incarcerated. So there have been a lot of, I guess, unintended consequences from this broader crackdown on immigration at the federal level.

HOBSON: But are people being kept in prisons not because they should be kept in those prisons but because the industry wants them to be kept in those prisons because they make more money when they are?

O'CONNOR: Well obviously the industry benefits, but this has really been - being driven by right now congressional Republicans. They have essentially mandated through the appropriations process that the Immigration and Customs Enforcement Agency keeps 34,000 beds occupied at all time. That number has gone up from, I believe, 18,000 around 2005.

Over that period of time, the industry has spent millions of dollars lobbying Congress on these issues. Now they say that they don't influence immigration policy, they're just trying to sell lawmakers on the services that they offer, but it is an unmistakable fact that Congress has been requiring ICE to detain these people, that a lot more people are in prison on immigration charges than had been before and that the companies are the direct beneficiaries of those policies.

HOBSON: Patrick O'Connor is a reporter for The Wall Street Journal. Patrick, thanks so much for joining us.

O'CONNOR: Thanks a lot for having me. Transcript provided by NPR, Copyright NPR.

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Robin Young and Jeremy Hobson host Here & Now, a live two-hour production of NPR and WBUR Boston.

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