THE BLOG
05/28/2014 08:58 pm ET | Updated Jul 28, 2014

Private Prisons Are Losing

It is no secret that for-profit prison companies are responsible for some of the worst human rights abuses of the past 30 years.

In 2012, the Department of Justice found that guards at the Walnut Grove Youth Correctional Facility (managed by GEO Group) routinely pepper sprayed and viciously beat youth for no reason. The DOJ report exposed a "deliberate indifference" amongst GEO group staff, and the company's complete disregard for rehabilitation. There were zero mental health crisis services, even at a time when almost a quarter of the youth were suicidal. The report also revealed a pattern of "brutal rape" by guards among the worst in the country. A federal judge eventually ordered all kids under 20 be removed from the prison, after finding the facility to be a "a cesspool of unconstitutional and inhuman acts...a picture of such horror as should be unrealized anywhere in the civilized world." The neglect and torture of private prisons are well documented among ever-increasing lawsuits, research, and news reports; the conditions at Walnut Grove are the norm, not the exception.

Over the past 20 years, the number of people locked up for-profit has increased by 1,664 percent, but the horrors of the industry have not been experienced evenly. Private prison companies get to cherry pick who they imprison, and in order to cut costs and increase profit, companies choose younger and healthier people who are disproportionately Black and Latino due to the discriminatory War on Drugs of recent years. The already devastating racial disparities of the public prison system are even worse in private prisons.

Private prison companies care about one thing: profit. To increase corporate revenue, companies like Corrections Corporation of America (CCA) and GEO Group cut back on crucial services and programming such as staffing, guard training, rehabilitative services, and medical care. The result: guaranteed inhumane conditions, increased rates of violence and recidivism, and at a higher financial cost to the state. The industry corrodes our democracy and worsens our criminal justice system, while making $5 billion a year.

But times are changing. Incarcerated people, community members, and advocates are standing up to this dirty industry and challenging its place in our criminal justice system. Just last week, GEO Group's desperate last-minute attempts to get a handout failed, after advocates successfully blocked the nearly $1 million the company tried to sneak into the Arizona budget. Idaho Gov. Butch Utter, a former friend of the industry, recently announced that the state is ending its contract with CCA to manage the Idaho Correctional Center (ICC), after an ACLU lawsuit and DOJ investigation revealed that the company lied about more than 26,000 hours of understaffing that lead to conditions so violent the prison was known as the "Gladiator School." The FBI is also investigating CCA for criminal conduct at ICC. The immorality of the industry has become impossible to ignore, and increasingly politicians are making the decision to cut ties with the private prison industry. And they are not alone.

In a groundbreaking move, three companies -- Scopia Capital, DSM, and Amica Mutual Insurance -- have divested nearly $60 million from CCA and GEO Group, after ColorOfChange urged executives to reconsider the moral, financial and political risks of investing in for-profit incarceration. The president of DSM North America, Hugh Welsh, spoke to the company's decision to divest, stating, "Investment in private prisons and support for the industry is financially unsound, and divestment was the right thing to do for our clients, shareholders, and the country as a whole. DSM is committed to good corporate citizenship and operating in a way that contributes to a better world."

This marks the first time a corporation has publicly confirmed divestment and denounced investment in private prison industry. The unprecedented leadership of these companies sets a new national standard: private prisons are an unacceptable investment. No longer can executives like Larry Zimpleman of the Principal Financial Group, which holds $106 million of client money in private prisons, claim that their hands are tied when it comes to divestment. Companies have a moral and financial responsibility to divest from this industry, especially those like Principal Financial that publicly promotes ethical investing.

Nearly 50,000 ColorOfChange members have committed to ending private prisons by pressuring politicians and companies to disassociate -- and it's working. In the coming weeks, with partners, we will continue to pressure corporations, universities, pension funds, and politicians to make a choice: either cut your ties with private prisons, or embrace the torture of this industry as your new public image.

We have reached a turning point, and the time for action is now.

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