Prisons for profit: do the social and political problems have a legal solution?

• Author: Antonuccio, Rachel Christine Bailie

1. INTRODUCTION TO THE PRIVATE PRISON INDUSTRY AND THE NONDELEGATION DOCTRINE A. The Advantages of Private Prisons B. The Disadvantages of Private Prisons C. The History of Private Prisons in the United States D. The Nondelegation Doctrine II. ANALYSIS A. Private Prisons Are Outside the Scope of the Nondelegation Doctrine 1. Supreme Court Authority Used to Challenge the Constitutionality of Private Prisons is Inapplicable 2. Circuit Court Authority Used to Challenge the Constitutionality of Private Prisons is Inapplicable B. Is the Nondelegation Doctrine Obsolete? III. RECOMMENDATIONS A. The Social Arguments Against Private Prisons B. The Political Argument Against Private Prisons C. Simplifying the Issue D. Specific Solutions IV. CONCLUSION I. INTRODUCTION TO THE PRIVATE PRISON INDUSTRY AND THE NONDELEGATION DOCTRINE

   Despite the fact that property (1) and violent (2) crime rates have declined since 1973, in the years between 1988 and 1997, the U.S. prison population increased drastically. (3) The factors contributing to the increase in the prison population included: a number of legislative enactments toughening drug and weapon penalties (4); enactments encouraging mandatory minimum sentencing; preventive detention; reduced use of parole; and increased penalties for habitual offenders. (5) During this same time, state and federal legislators were unreceptive to legislation involving new taxes and construction bonds, (6) the most utilized methods of financing state and local prisons. (7) In a little less than a decade, the U.S. prison population nearly doubled, rising from 627,600 inmates in 1988 to 1,244,554 inmates in 1997.8 In 1997, the federal prison system reported functioning at 19% over capacity, (9) and state prisons reported functioning at 24% over capacity. (10) These facts, combined with a 1992 executive order issued by President George Herbert Walker Bush requiring all federal agencies to encourage state and local governments to utilize private prisons, (11) led governments to look to private prisons (12) as a necessary supplement to public ones. (13)

   1. The Advantages of Private Prisons

      At first glance, private prisons seem to have a number of advantages over public prisons. Private prison advocates claim that private prisons save taxpayers money. (14) Because they are subject to less bureaucracy than public prisons, private prison corporations claim they can build and staff their prisons more quickly and less expensively than can public prisons. (15) While state or federal governments take at least two years to build a prison, private prison corporations claim they can build a prison in less than 18 months. (16) Private prisons have the advantage of being able to test new incarceration philosophies without the hindrance of the lengthy approval procedures that bind public prisons. (17) They also have the luxury of strategically locating themselves in states that provide the greatest economic benefit, giving governments the option to transfer prisoners to states in which prisoners can be held at the least expense. (18) Additionally, as a result of privatization, governments face potentially less liability in suits brought by prisoners and prison staff. (19)

   2. The Disadvantages of Private Prisons

      While private prisons have some advantages over public prisons, they pose a number of social and logistical disadvantages as well. Opponents of prison privatization question the implications of the potential to profit from incarceration (20) and the resulting disincentive to curb the influx of new inmates. (21) On May 3, 2006, Corrections Corporation of America (stock symbol CXW), the largest private prison corporation in the United States, posted a $21.3 million first quarter profit and raised its full-year profit outlook by ten cents per share. (22) "We've never seen the wind at our back like it is today," Chief Executive John Ferguson said that day in a shareholder conference call. (23) On June 1, 2006, the close of the fiscal year, stock shares in Corrections Corporation of America (CCA), reached a 52 week high of $52.45 per share, a 13.6% increase since the year prior. (24) In 2005, the company enjoyed a 22.9% profit increase from 2004, posting a $70.9 million dollar profit. (25) Houston-based Cornell (stock symbol CRN) and Boca Raton-based Geo Group (stock symbol GGI), two other leading private prison corporations, also had very successful 2005-2006 fiscal years. (26) Their stocks increased 18.4% and 67.1%, respectively. (27)

      Private prison opponents point out that the number of prisoners in this country has always increased to fill available prison space, even as crime rates decline. (28) CCA publicly celebrated this fact in their former company motto: "If you build it, they will come." (29) The motto has since changed, but its sentiment is seemingly seared in the corporate brain of CCA, which continues to build prisons ahead of demand. (30) "Other companies tend to operate at 100% occupancy and would tend to build a facility after they have a contract," explained Jim MacDonald, managing director of First Analysis, the company that previously managed CCA's public offering. (31) "What [CCA] does that's different from the other companies out there is effectively use their balance sheet and build ahead of the demand." (32)

      Critics also question the competence of private prison staff members, pointing to incidents of prisoner abuse from allegedly inadequately trained staff. (33) They question whether private prisons are in fact more cost effective than public prisons, and whether the government is legally entitled to delegate the function of administering prisons to private entities. (34)

      As a result of these and other concerns, in 1986 the American Bar Association House of Delegates passed a Resolution recommending "jurisdictions ... considering the privatization of prisons and jails not proceed ... until the complex constitutional, statutory, and contractual issues are satisfactorily developed and resolved." (35) Nonetheless, governments readily delegated the prison function to private companies. (36) By midyear 2005, 101,228 of the nation's 1,438,701 prisoners were held in private prisons. (37) As of June 2006, state and federal governments outsourced 6.7% of the prison population to private institutions. (38) That figure is expected to rise to 7% by the end of 2007. (39)

   3. The History of Private Prisons in the United States

      The relationship between prisons and private industry is not a recent innovation, but rather dates back to our nation's origin. (40) In the colonial period, incarceration was a rarely utilized form of punishment. (41) Newly formed governments, unequipped to house criminals, looked to private jailers to provide detention services. (42) At the beginning of the nineteenth century, via legislation or private contracts, some states leased prison labor to private enterprises. (43) In other states, private organizations exerted complete control over the prison function. (44)

      It was not until the end of the nineteenth century, when states began to determine that private prisons were not as cost efficient as they originally believed, and when concerns about the abusive conditions of private prisons began to pervade public consciousness, that the prison system became a function of the government. (45) Still, state governments continued to contract prison labor to private parties. (46) The rise of labor unions in the twentieth century somewhat hindered the relationship between the government and private industry, but governments still contracted out for the provision of prison food, medical, and educational services. (47) In the early 1980s, the private sector took on a bigger role by contracting with governments to operate half-way houses, juvenile facilities, undocumented immigrant detention centers, and work-release programs. (48) In 1984, CCA began operating the nation's first completely privately run prison since the 1800s. (49) In the following two decades, U.S. reliance on private prisons has steadily increased. (50)

   4. The Nondelegation Doctrine

      Critics of private prisons claim the governmental delegation of the prison function to private companies is a violation of the nondelegation doctrine. (51) The nondelegation doctrine forbids Congress from delegating certain powers to public or private entities. (52) Professor Erwin Chemerinsky describes the purpose of the nondelegation doctrine as forcing "a politically accountable Congress to make the policy choices, rather than leave this to unelected administrative officials." (53)

      The doctrine's constitutional origins are in Article I and the Due Process Clauses of the Fifth and Fourteenth Amendments. (54) Article I of the Constitution, the portion of the Constitution regarded as the genesis of the nondelegation doctrine, makes the following statement about separation of powers: "All legislative Powers herein granted shall be vested in a Congress of the United States." (55) Courts examine delegations to governmental agencies or other public bodies under this section of the Constitution. (56)

      Because of its belief that government has an obligation to "preclude the exercise of arbitrary power," (57) the Supreme Court also found a basis for the nondelegation doctrine in the Due Process clauses of the Fifth and Fourteenth Amendments, (58) which forbid federal and state governments from depriving any person of "life, liberty or property without due process of law." (59) Courts generally analyze government delegations to private parties under these portions of the Constitution, (60) and would likely evaluate the constitutionality of the delegation of the prison function to private corporations under these sections of the Constitution as well.

2. ANALYSIS

   While there are many valid reasons to oppose the delegation of the prison function to private entities, private prison critics have difficulty presenting a viable legal basis...