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The U.S. Prison System - A Profitable Business

Updated on October 23, 2012

The United States has the highest rate of incarceration in the world. According to the Bureau of Justice Statistics, at the end of 2010, there were 1,612,395 prisoners in Federal and State prison in the United States. The illustration shows the United States incarceration rate compared to other countries around the world. There is an additional 4,887,900 adults on probation or parole in this country. What is the reason for such high incarceration rates in the country? Are our crime rates really that high or have the states and big corporations found a way to make the prison system a billion dollar business?

In recent years, some mega corporations such as Corrections Corporation of America (CCA) and GEO Group, Inc. (GEO), have been making enormous profits from building prisons across the country. According to Wikipedia, in 2010 the GEO Group reported 1.27 billion dollars in Revenue, and CCA reported 1.736 billion in revenue. CCA and GEO are also listed on the New York Stock Exchange, which means they have a stake in making profits in the building and managing of correctional facilities. The other stake these corporations have is in the incarceration of inmates to fill up these prisons to keep the profits coming in. Corrections Corporation of America (CCA) has made an interesting proposal to state prison officials across the country. The proposal is to offer to buy and manage public prisons, and in return CCA is asking that the prisons contain at least 1000 beds, and the states would agree to maintain a 90% occupancy rate in the privately run prisons for at least 20 years.

The danger with this proposal is that when you start placing a profit on how many prison cells are filled, you then have to wonder if there are many non-violent and petty criminals doing hard time just because there is a profit to be made. Another thing to consider is the lengthy sentences that are handed down by Judges that are being bribed or coerced in the name of making profits.

As the illustration indicates, violent crime has been declining in recent years, yet the prisons around the country are overcrowded. The argument we hear is that because of the overcrowding, we need to build more prisons. This argument comes into question when you see the mega profits these corporations are making by arresting and imprisoning people for the sake of making a profit.


The prison population is disproportionately skewed. Blacks and Hispanics have a much higher rate of being imprisoned than Whites. There could be a lot of reasons for this divide. Some could argue that Blacks and Hispanics commit more crimes landing them in prison. There is no doubt that Blacks and Hispanics commit crimes, but to say that they commit crimes at such a disproportionate level to Whites is questionable. The fact of the matter here is that Blacks and Hispanics are definitely targets in the judicial and prison systems regarding the profits made by these for-profit corrections corporations. A large number of the Hispanic prison population consists of illegal immigrants, especially in the southern states of the country. The question is whether all of the news reports you hear about how immigrants are committing more crimes is truly accurate? Could it be that some of these immigrants are arrested and imprisoned to fill up these prisons to make money on them? Are some Blacks being arrested and imprisoned in some parts of this country for the same reason?


The idea of corporations building and managing prisons for-profit should make people question the possible motive behind these high numbers of the inmate population. The fact is that minorities make up a substantial number of the prison population in these private prisons. It is very surprising to me that more people are not aware of the huge profits these corporations are making on the backs of minorities who are helpless to defend themselves in a court of law due to lack of knowledge and financial means.

There is a need for prisons in this country because there are people that should and need to be incarcerated. There are rapist and murders that shouldn’t be allowed to have their freedom ever again, but there are a lot of non-violent criminals who are incarcerated for lengthy prison sentences just for the sake of profit. I am a big believer in paying the consequences for the crimes you commit, but the sentence should reflect the crime. The question is are we comfortable with corporations making money on how many prisons they can fill?



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    • NayNay2124 profile image

      NayNay2124 5 years ago

      Michele, When I first heard about this I was totally shocked, and could not believe this could be true. It is a very scary thought to think about what they will do to keep the prisons full. These corporations have a lot of financial clout. Very scary. Thanks for reading and commenting.

    • Michele Travis profile image

      Michele Travis 5 years ago from U.S.A. Ohio

      Thank you so much for sharing this information. This is very frightening. Private prisons and keeping them 90% full and operational? What are they going to do if they do not have enough prisoners?

      Just something I was thinking about.

      Excellent hub.

      Voted up.

    • NayNay2124 profile image

      NayNay2124 5 years ago

      Jose7polanco, I think private services could be very beneficial if we could trust that these companies are not going to target minorities for the sake of profit. Private companies are in a better position to compensate their staff, whereas states are restricted by budgets. Thanks for visiting and for the follow.

    • jose7polanco profile image

      Jose Misael Polanco 5 years ago from Los Angeles

      wow great introduction and graph, really nice design. Private prisons opened the door to other public justice privatization like security, juvenile probation, supervised parole and other probation done by companies aiding the exhausted over loaded public system.

      My question is, which one is more expensive? Sustaining public justice or combining it with private services? I heard they were so lucrative they offer their employes benefits way way way beyond those the government could ever afford.

    • NayNay2124 profile image

      NayNay2124 5 years ago

      billybuc, I just find it very disturbing and I wanted to share this information. Thank you for reading and commenting.

    • billybuc profile image

      Bill Holland 5 years ago from Olympia, WA

      I of course have serious problems when a corporation takes over incarceration of prisoners, and all people should have a problem with it. The penal system should have nothing to do with profit and loss.

      Great job of highlighting this disturbing situation.