Surprising Modern Day Slavery: The USA Prison System

Slavery in the USA Prison System

DID YOU KNOW? Privately held prisons and privately-run immigration detention facilities are on the STOCK MARKET? I learned a lot about this while campaigning with Farouk for Governor in TX. Corporate stockholders who make money off prisoners’ work for lobby for longer sentences, in order to expand their workforce. The prison industry is one of the fastest-growing in the USA and its investors are on Wall Street. And it gets even worse: the 340% increase in Americans behind bars was funded, in part, by corporations looking for cheap labor. Dozens of respected companies funded the American Legislative Exchange Council (ALEC), which passed the “Prison Industries Act” to expand inmate labor.

Today, even the federal government brags about the “business opportunities” at dozens of federal prison factories across the country.

Republican Oregon State Representative
Kevin Mannix

Republican Oregon State Representative Kevin Mannix urged Nike to cut its production in Indonesia and bring it to his state, telling the shoe manufacturer that “there won’t be any transportation costs; we’re offering you competitive prison labor here.”

This multimillion-dollar industry has its own trade exhibitions, conventions, websites, and mail-order/Internet catalogs. It also has direct advertising campaigns, architecture companies, construction companies, investment houses on Wall Street, plumbing supply companies, food supply companies, armed security, and padded cells in a large variety of colors.

At least 37 states have legalized the contracting of prison labor by private corporations that mount their operations inside state prisons. Under the Work Opportunity Tax Credit (WOTC), employers receive a tax credit of $2,400 for every work-release inmate they employ as a reward for hiring “risky target groups.” The list of such companies contains the cream of U.S. corporate society: McDonalds uses prison labor to make its uniforms. Starbucks used them in the past to package holiday coffee. Revlon, Macy’s, Verizon and Sprint. For a complete list

Just between 1980 and 1994, profits went up from $392 million to $1.31 billion. Inmates in state penitentiaries like Texas do not receive any compensation and are allowed to work up to 12 hours per day. In Colorado, they get about $2 per hour.

Thanks to prison labor, the USA is once again an attractive location for investment in work that was designed for 3rd World labor markets. A company that operated a maquiladora (assembly plant in Mexico near the border) closed down its operations there and relocated to San Quentin State Prison in California. In Texas, a factory fired its 150 workers and contracted the services of prisoner-workers from the private Lockhart Texas prison, where circuit boards are assembled for companies like IBM and Compaq.

In privately-run prisons, they receive as little as 17 cents per hour for a maximum of six hours a day, the equivalent of $20 per month. The highest-paying private prison is Core Civic Inc. in Tennessee, where prisoners receive 50 cents per hour for what they call “highly skilled positions.” At those rates, it is no surprise that inmates find the pay in federal prisons to be very generous. There, they can earn $1.25 an hour and work eight hours a day, and sometimes overtime. They can send home $200-$300 per month.

On average our country is spending $100,000 per inmate and less than $10,000/year is being spent per student. There are approximately 2 million inmates in state, federal and private prisons throughout the country.

The USA has locked up more people than any other country: a half million more than China, which has a population 5 times greater than U.S. USA holds 25% of the world’s prison population, but only 5% of the world’s people.

From less than 300,000 inmates in 1972, the jail population grew to 2 million by the year 2000. Profit potential for those who invest in the prison industry complex are jailing persons convicted of non-violent crimes, and long prison sentences for possession of microscopic quantities of illegal drugs.

A guard watches as detainees fold clothes at an immigration detention center run by the private corrections corporation GEO Group in Bakersfield.
(Bob Chamberlin / Los Angeles Times)

The prison privatization boom began in the 1980s, under the governments of Ronald Reagan and Bush Sr., but reached its height in the 1990s under the Clinton administration when Wall Street stocks were selling like hotcakes.

Clinton’s program for cutting the federal workforce resulted in the Justice Departments contracting of private prison corporations for the incarceration of undocumented workers and high-security inmates.

Private prisons are the biggest business in the prison industry complex. About 18 corporations guard 10,000 prisoners in 27 states. The two largest are Core Civic Inc. and the GEO Group, which together control 75%.

Private prisons receive a guaranteed amount of money for each prisoner, independent of what it costs to maintain each one.

Core Civic Inc. used to be CCA

In Core Civic Inc. prisons, inmates may get their sentences reduced for “good behavior,” but for any infraction, they get 30 days added – which means more profits for Core Civic Inc. These inmates lose good behavior time at a rate of 8 times higher than those in state prisons.

IMPORTING AND EXPORTING INMATES profits are so good that now there is a new business: importing inmates with long sentences, meaning the worst criminals. When a federal judge ruled that overcrowding in Texas prisons was cruel and unusual punishment, Core Civic Inc. signed contracts with sheriffs in poor counties to build and run new jails and share the profits.

Investors from Merrill-Lynch, Shearson-Lehman, American Express and Allstate, and the operation was scattered all over rural Texas. That state’s governor, Democrat Ann Richards, followed the example of Democrat Mario Cuomo in New York and built so many state prisons that the market became flooded, cutting into the private prison profits.

After a law signed by Clinton in 1996 – ending court supervision and decisions – caused overcrowding and violent, unsafe conditions in federal prisons, private prison corporations in Texas began to contact other states whose prisons were overcrowded, offering “rent-a-cell” services in the Core Civic Inc. prisons located in small towns in Texas. The commission for a rent-a-cell salesman is $2.50 to $5.50 per day per bed. The county gets $1.50 for each prisoner.

Prison labor has its roots in slavery. After the 1861-1865 Civil War, a system of “hiring out prisoners” was introduced in order to continue the slavery tradition. Freed slaves were charged with not carrying out their sharecropping commitments (cultivating someone else’s land in exchange for part of the harvest) or petty thievery – which were almost never proven – and were then “hired out” for cotton picking, working in mines and building railroads.

From 1870 until 1910 in the state of Georgia, 88% of hired-out convicts were Black. In Alabama, 93% of “hired-out” miners were Black. In Mississippi, a huge prison farm similar to the old slave plantations replaced the system of hiring out convicts. The notorious Parchman plantation existed until 1972.

97% of 125,000 federal inmates have been convicted of non-violent crimes. It is believed that more than half of the 623,000 inmates in municipal or county jails are innocent of the crimes they are accused of. Of these, the majority are awaiting trial. 2/3 of the one million state prisoners have committed non-violent offenses. 16% of the country’s 2 million prisoners suffer from mental illness.

California Governor Gavin Newsom

In California, our Gov. Gavin Newsom signed a bill that will end the use of private prisons and privately-run immigration detention facilities.

Under the new law, California will phase out the use of these for-profit, private detention facilities by 2028. The state will be prohibited from renewing contracts or signing new contracts with a private prison company after January 1, 2020

The Trump administration sued the state of California, asserting that a new state law that bans for-profit prison contracts unconstitutionally interferes with the federal prison and immigration detention systems.

In December 2019, Federal officials signed nearly $6.5 billion in contracts with private prison companies for immigration detention centers.



For all the continual bumps in the road, the GOP is doing what it can to make inroads in the Hispanic community.  But while it seems like everyone left, right, and center has heard of Sen. Marco Rubio (R-FL), Congressman Raul Labrador (R-ID), fellow member of the class of 2010, has been behind the scenes advancing a strong conservative agenda in the House of Representatives. While Congressman Labrador has appeared on the Sunday shows a number of times, and was even a speaker at the 2011 Conservative Political Action Conference in Washington, D.C., he has not received the same attention from media circles as his colleague in the Senate, despite the accolades from the right. He recently obtained a 100% rating from the Club for Growth and previously from Americans for Prosperity, two well established conservative organizations. In addition, he made recent news for putting his money where his mouth is regarding fiscal responsibility, returning21% of his office budget to to pay down the national debt.

Raul Labrador provides the GOP with a credible face for broader immigration reform. | AP Photo

Born and raised by a single mother in Carolina, Puerto Rico, Rep. Labrador first moved to the United States in 1981 at the age of 13, but not to the usual locations of New York or Florida. A friend of his mother’s suggested Las Vegas, Nevadawhich at the time experienced an economic boom. He later graduated from Brigham Young University (where he met his wife, Rebecca) and received his law degree from the University of Washington.

So how did Congressman Labrador find himself becoming a conservative standard bearer?

Labrador’s mother was heavily involved in Puerto Rican politics, describing her as a Democrat and strong admirer of the Kennedys. “But when we moved to Las Vegas, one of the first things [my mother] did after getting a job was getting registered to vote,” says Labrador in an interview with Politic365. “And in Las Vegas, Nevada you had to register by party, and she decided to register as a Republican, which was shocking to me!”

Labrador’s mother was one of those famed “Reagan Democrats,” excited about voting for Reagan in the next primary.

It was from there that Labrador discovered Ronald Reagan, the values and principles he held, discovering the same principles Reagan held aligned with those taught at home. His mother taught him to not rely on the government, to work hard, and be successful in whatever path he chose to take, and the GOP was the party who advocated these same principles. But despite Congressman Labrador’s virtually perfect backstory for a political candidate, like Marco Rubio he had to achieve victory over the GOP Establishment by winning the 2010 primary in an upset. “I went back to the old Reagan coalition,” Labrador explained when asked how he won over the primary voters, “and I talked to all of them about exactly how the Republican Party should be. I believed the Republican Party has kinda lost its way for awhile, sometimes we are good at espousing conservative principles, but not at living them.” Like many other Tea Party candidates in 2010, Labrador’s message of bringing honest conservative principles back to the GOP and a willingness to go against the wishes of the establishment propelled him to victory as a freshman member of Congress.

U.S. Rep. Raul Labrador (R-ID) speaks at a Tea Party rally March 31, 2011 on Capitol Hill in Washington D.C. The group says it is "challenging Congress and the members it helped sweep into power to take swift action on the budget." (Olivier Douliery/Abaca Press/MCT)

 A Look at the Federal Tax Code

Coming into 2012, Congressman Labrador is hoping major progress can be made towards making the current federal tax code make sense. “When you talk to Republicans, Democrats, and Independents, they’re all frustrated with the current tax code that we have.” He lamented the current tax code as one that picks winners and losers, and places the blame on both parties favoring their own special interests when altering the code, leaving the middle class to suffer the burden. He believes in a flat and fair code in which everyone should pay something, from the 40-45% of American wage-earners who pay no federal income taxes, to corporations like General Electric who takes advantage of directed tax subsidies and loopholes, and can afford the accountants, lobbyists, and lawyers to obtain them. “That’s not what makes America great.”

Immigration Reform

On the tepid relationship between Hispanics and the GOP, and in particular the issue of immigration reform, Labrador’s experience as an immigration attorney gives him a unique measure of credibility on the issue. Labrador’s biggest piece of advice to Republicans: let Hispanics know that they are welcome in the party – Hispanic principles of family and hard work form the bedrock of the GOP’s platform. He argues rhetoric from some in the Republican Party has turned off many in the Hispanic community. “We can be for a strong border, but we can also be for legal immigration and finding a system that actually works in the United States, and I think most people are frustrated with the current system of immigration.” Labrador said his goal is to help the GOP articulate a conservative consensus on legal immigration.

A Rising Star

photo source AP

From taxes, to the debt crisis, to the issues of life and entitlements, Labrador has the record to make any conservative stand up and cheer. But, a unique background mixed with an ability to become a conservative conduit to Hispanics on immigration sets him apart from the other Tea Party freshmen in Congress. If he is not already a rising star in the Republican Party, many believe he should be.


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