Private Prisons and Incentive Design: Critiquing Oliver Hart

One of Nobel prize-winner Oliver Hart’s most influential papers (co-authored with Andrei Shleifer and Robert Vishny) is on incentive design and private prisons (see Tyler’s post covering Hart’s work). Yesterday was not the day for a critique but Tyler and I do critique this paper in our principles textbook, Modern Principles. I believe that our textbook is the only principles textbook to have a chapter on contract design and we make this modern material accessible to undergraduates! Here is our explanation and critique:

Should the management of prisons be contracted out to the private sector? The
owners of a private firm have a strong incentive to cut costs and improve productivity because they get to keep the resulting profits. If a public prison cuts
costs, there is more money in the public treasury but no one gets to buy a yacht so the incentive to cut costs is much weaker.

private_prisonIn 1985, Kentucky became the first state to contract out a prison to a for profit firm. Private prisons today hold about 120,000 prisoners in the United
States, about 5 percent of all prisoners. Should efficient private prisons replace
inefficient public prisons? Three economists—Oliver Hart, Andrei Shleifer, and
Robert Vishny (HSV)—say no. HSV don’t question that the profit motive gives
private prisons stronger incentives than public prisons to cut costs—HSV say
that’s the problem! Suppose that we care about costs but we also care about
prisoner rehabilitation, civil rights, and low levels of inmate and guard violence.
What we pay for is cheap prisons, but what we want is cheap but high quality
prisons. If we can’t measure and pay for quality, then strong incentives could
encourage cost cutting at the expense of quality.


The principle is a general one, a strong incentive scheme that incentivizes
the wrong thing can be worse than a weak incentive scheme. One car dealer in
California advertises that its sales staff is not paid on commission.
 Why would
a store advertise that its sales staff do not have strong incentives to help you?
The answer is clear to anyone who has tried to buy a car. High-pressure dealers
who pounce on you the moment you enter the showroom and bombard you
with high-pressure sales tactics (“I can get you 15 percent off the sticker, but
you have to act NOW!”) may sell cars to first-time buyers, but the strategy is
too unpleasant to win many repeat customers. Car dealers who rely on repeat
business usually prefer a low-pressure, informative sales staff….
In theory, a car dealer could have strong incentives and repeat business by
paying its sales staff based on their “nice” sales tactics, but in practice it’s too
expensive to monitor how salespeople interact with clients. Cheating by the
sales staff would be difficult to detect and thus would be common. 

What about prisons? Are HSV correct that weak-incentive public prisons
are better than strong incentive private prisons? Not necessarily. HSV assume
that cutting quality is the way to cut cost. But sometimes higher quality is also
a path to lower costs. Low levels of inmate and guard violence, for example, are
likely to reduce costs. And respect for prisoner’s civil rights? That can save on
legal bills. When quality and cost cutting go together, a private firm has a strong
incentive to increase quality.


HSV may also underestimate how well quality can be measured. Measuring
output pays off more when incentives are high. Unsurprisingly, therefore,
private prison companies and government purchasers have made extensive
efforts to measure the quality of private prisons.


Finally, don’t forget that weak incentives reduce the incentive to cut costs
but they don’t increase the incentive to produce high quality! Public prisons
might use their slack budget constraints to offer high-quality rehabilitation
programs, or they might instead offer prison guards above-market wages.
Which do you think is more likely?


Nevertheless, whether HSV are right or wrong about private prisons, their
argument is clever. The usual argument against government bureaucracy is that
without the profit incentive, public bureaucracies won’t have an incentive to
cut costs. HSV suggest this is exactly why public bureaucracies may sometimes
be better than private firms.

Addendum: We don’t go through the empirical literature in the text but overall it’s not supportive of HSV. As HSV predict, private prisons appear to be cheaper than public prisons but they are not significantly cheaper and the quality of private prisons is comparable to that of public prisons and maybe a little bit higher (faint praise). Basically the government gets what it pays for.

Comments

Suppose that we care about costs but we also care about prisoner rehabilitation, civil rights, and low levels of inmate and guard violence.

And why should be suppose to worry about this kind of Obama-era concern? Before Obama became President we used to think of prisons as being there to punish people who didn't want to follow the rules but now we need to discuss criminals as if there are there to be "rehabilitated" - which seems to be mean be given a taxpayer funded Obamaphone and let loose on the public.

Just look at figure 1 (average time served in federal prisons). http://www.pewtrusts.org/en/research-and-analysis/issue-briefs/2015/11/prison-time-surges-for-federal-inmates

6 years for violent crimes, 2 years for property crimes, 5 years for drug related offenses. When convicted criminals exit the prison around the same an student finishes undergrad education, it's worth to look at the rehabilitation issue.

If people where sent to an island where they never return, we need to go back to XIX century.

Keep them in longer.

Guess what? Keeping people longer in jail also costs money.

We don't need to be spending lavish amounts on food for these criminals. How much did it cost to run a prison in 1880? Why should our prisons be any more expensive to run? Obama has refused to bend the cost curve on prison spending.

I think bulgar wheat and a few other staples would do, supplemented with family care packages. I think you'll discover, though, that prisons are expensive because of labor costs. That's a feature of 24 hour care.

No need to import wheat from Bulgaria, Art. Or there wouldn't be if Obama hadn't eviscerated this country's Midwestern breadbasket.

Sorry for the misspelling. It's bulgur wheat. It's great stuff, highly nutritious. It's the sort of thing you might cook over a camp stove. Here

http://vegetarian.about.com/od/glossary/g/Bulgur-Wheat.htm

I've been saying for years that a California initiative to make the prisons vegan would succeed. A) it's cheaper than feeding them meat because of direct cost of food and reduced need for refrigeration. B) The voters would think it's just a little dollop of extra deserved punishment. C) It's safer because of reduced risk that food would spoil causing food poisoning. D) No risk of violating religious requirements on food for Muslims, Orthodox Jews, Hindus, Buddhists, etc. E) A chance to test the theory that eating meat makes people more aggressive. F) Another lever for staff to handle prisoners. "You behave yourself all week, and you'll get a burger on Sunday."

Federal prisons encompass only 11% of those incarcerated. In the sum of federal and state prisons, mean time served is 30 months.

Why is this an Obama thing? HSV is a 20 year old paper, and people have been loudly advocating for these things since at least the 1970s, if not the 1960s.

"Early American prisons, such as those at Auburn, Ossining, and Pittsburgh during the 1820s, implemented rehabilitative principles.."

But then why do I bother?

Looks like someone has been reading the "Obama's History of America' textbook.

I also wonder why you bother.

"during the 1820s, implemented rehabilitative principles..”

Is not 200 years of failure enough?

The rehabilitation versus punishment argument goes back generations, since it has begun in earnest. In fact, it goes back hundreds or perhaps thousands of years, depending on how you define your terms.

The ability of Obama haters to blame him for ills of all of history knows no bounds ...

"Public prisons might use their slack budget constraints to offer high-quality rehabilitation programs, or they might instead offer prison guards above-market wages."

Well, right, but doesn't this contradict the earlier claim about cost cutting? If a public prison minimizes the cost and quality of rehabilitation programs, food, etc, that leaves more for wages, retirement plans, for example:

http://gawker.com/5797381/spoiled-california-prison-guards-have-it-easy

It seems to me that the incentives for the jailers to minimize what they spend on prisoners so they can maximize what they take home are pretty similar.

The claim about cost cutting relating to the private sector. Your quote refers to the public sector.

Which explains the apparent contradiction.

This discussion is interesting, and is adjacent to another interesting conversation - long-term vs. short-term profitability incentives. Incentive structure matters, but the long-term and "correlative-structured" incentives (lower violence, fewer lawsuits) might be claimed by vectors other than prison quality. For-profit prison managers are likely like other managers and will look for the shorter term incentive. Perhaps NPV offers some solution. Perhaps the discussion ties in here: http://marginalrevolution.com/marginalrevolution/2016/10/corporate-thinking-short-term.html

Pay private prisons bonuses based on the inverse of the time it takes for prisoners to return to prison. If they return to prison in 6 months, the contractor is penalized. If they don't return in two years, the bonus is nothing. If they have not returned in 3, then $50,000, in 4, an added $50,000, and in 5, a bonus equal to 20% of the rehabilitated person's taxable income for years 5-10.

I would love to see some variant of this idea happen, both for private prisons and also for decisions to release prisoners early on parole. It would be tricky to get the incentives right--all the costs are up-front and all the benefits to decreasing recidivism are far in the future. But you could imagine doing it well. The main problem would be avoiding cherry-picking--the best kind of prisoners to get are the group that are least likely to reoffend--maybe that's middle-aged embezzlers who will never be given another job handling cash anyway, or murderers whose actual murder was because of some extreme and unlikely-to-repeat circumstances (the usual example being the guy who walks in on his wife and best friend in bed together). There's a similar problem with evaluating charter schools and private schools vs public schools--if the charter schools can kick out the disruptive and dumb students but the public schools can't, then the charter schools end up looking a lot better than the public schools.

"Should the management of prisons be contracted out to the private sector? The owners of a private firm have a strong incentive to cut costs and improve productivity because they get to keep the resulting profits. If a public prison cuts costs, there is more money in the public treasury but no one gets to buy a yacht so the incentive to cut costs is much weaker."

The "cost effectiveness" argument in this country at this time is basically political convention.

Cost effectiveness is considered quality even in cases where quality can clearly be measured like health care.

That attitude invariably leads to significant quality problems. People will naturally care less about this issue when it comes to prisons unless they are personally affected. But they really don't seem to protest rationed health care very much either.

I love the idea that Government prison guards and wardens are sitting around thinking, "I'm not incentivized to cut costs. I get paid the same no matter what I do. So you know what? I'm going to spend the day fostering rehabilitation among the inmates, and seeing what I can do to improve their civil rights!!"

Sure, they likely don't think a bout it from an individual's perspective--but they do think: jeeze, it looks pretty bad when the prisoners riot or kill one another, maybe I should devote some money to civil rights.

"Sure, they likely don’t think a bout it from an individual’s perspective–but they do think: jeeze, it looks pretty bad when the prisoners riot or kill one another, " ... maybe I should devote some money to more guards and water hoses.

I think this fits the evidence better.

I still think that equates to more civil rights

Maybe, it does, maybe it doesn't. But it certainly equates to more money spend on Prison Guards and more dues to the the appropriate union.

Guards and wardens are rarely, almost never, involved in the people stuff that contributes to rehabilitation.

Looks like Alex is posting his mood affiliation today.

Also did you see Yglesias' post today? Tyler got butt slammed

Yeah...although I'm against everything Yglesias and co. stand for in terms of politics I do approve of him Voxsplaining to people. All-in-all Yglesias and Co. are members of the meritocratic elite so I generally see Voxsplaining as an acceptable means whereby social betters tell their social inferiors (ie most of the blog readers here) what to think.

Econ Parlour Games. "Despite the repeated observation that private prisons are a little bit better and a little bit cheaper than the state variety, they really aren't - because theory." #eyeroll

I think this post mis-characterizes the problem by assuming it away. The general issue with strong incentive schemes is that when there are multiple objectives - and some cannot be easily measured - then strong incentives can achieve some objectives at the expense of others. To say that improving quality will also lead to lower costs essentially assumes away the multiple objectives, reducing them to one objective. It is possible that this is the case - with prisons, or with teachers, or with sales people - but in many cases there are truly multiple objectives and strong incentives do run the risk that Hart et al are talking about.

Of course, in the context of prisons, the issue then becomes an empirical one. I'm not familiar with that research specifically, so I hold no opinion on whether or not the general result of a tradeoff between objectives applies in this case. But to present the general issue as there is really only one objective is an incorrect characterization of the problem.

The prisons are paid per prisoner per day, basically.

Their profit maximization calculation is thus nothing more than a cost minimization calculation. As much as they can get away with, and probably a good deal more, as those who build prisons do not tend to rise to the top of investigation lists very easily when they break laws or regulations.

On the other hand, one commonly-cited reason against private prisons is that they also have a strong incentive to increase incarceration rates (predominantly through lobbying for harsher laws such as 3 Strikes and mandatory minimum sentences); as long as the private prison industry has political (i.e. monetary) clout, there will be a constant pressure exerted on the legislature in favour of draconianism.

Second this. I've never heard anyone talk about quality of life or mandatory productivity as the issue with private prisons; seems like a red herring. The negative externality of creating a felon out of a normal member of society is MANY times more concerning, though I've always wondered how much influence that industry could actually have.

America being the place that it is, do you think that someone builds a private prison and doesn't already have influence? I assume the contracts are handed out on the basis of political donations (or outright corruption), far more so than on the substance of bids.

>there will be a constant pressure exerted on the legislature

Oh, I see your complaint, Eric. You are worried that politicians will sell their votes to the highest bidder, in complete disregard for what is good for society, so they can get rich accepting bribes instead of doing their job.

Naturally, you see that as a problem... with the private prison industry.

But

1. even when not privatized, there are still groups that lobby for things like Three Strikes. The prison guard union, for example.

But

2. Three Strikes was immensely popular with the average voter, and the lobbying dollars that went into it were very small. https://ballotpedia.org/California_Proposition_184,_the_Three_Strikes_Initiative_(1994) It got over 70% of the vote. A few million on lobbying is not going to explain that.

The problem is the voters wanted Tough On Crime.

"The problem is the voters wanted Tough On Crime."

How dare people want safety! They should enjoy being victimized.

Every one wanted those bad kids down the street to be punished harshly. The problem is the law does not selectively punish people the way the voters want.

As long as black kids were going to jail and dying for drug related matters, the 70% white were happy, although the death tolls only made them more fearful.

But once white kids started being sent to jail and started dying in large numbers, the 70% white became very unhappy.

New England is in a crisis of white people dying from fentanyl overdoses. Suddenly treating drug use as a health issue and figuring out how to provide drug rehab, mental health, medical care is a priority, especially in 98% white NH.

But I remember the plains States and the meth crisis (which inspired Breaking Bad) which involved whites and thus the lock em up policies were no longer acceptable.

because lobbyists don't buy advertising to make a complicated issue seem like it has a straightforward solution? I'm reminded of the chemical industries heart tugging ads for fire retardant laws, which sounds reasonable, except in reality those chemicals did very little except get into people lungs and poison them.

Do you really think two million dollars of ads in a state of 35 million people moved the polls by 20 percentage points?

Chances are the police and prison guard unions will be able to exert more political pressure to maintain the 'prison industrial complex' than would the private prison industry. See support by police and prison guard unions in CA in opposing sentencing reform and drug decriminalization.

Strange as it may seem to you, police work and prison work may just attract the sort of people who would be resistant to the idea of allowing judges to turn criminals over to social workers.

Right, and I'm sure that having their livelihoods dependent upon a steady stream of new 'customers' does nothing to reinforce that 'resistance' to reducing rates of incarceration. But, of course, pot users and dealers are only criminals because of the laws that these unions are helping preserve (they are notably NOT criminals in Colorado, Oregon, Washington, and hopefully soon in a state near you).

But that's really beside the point, which is that government unions have at least as much interesting in lobbying and at least as much clout in doing so as any private prison operators (regardless of whether that lobbying is sincere, opportunistic, or some mixture of both).

Art,

Would you make a similar argument about teachers/teachers unions and mandatory class sizes/special Ed nonsense?

If not, why? I think the idea of world view and self interest informing their opinions are not mutually exclusive, but rather reinforce one another. I still think they're both wrong, and at the end of the day you and I are the ones stuck with the check.

What costs might a private prison reduce...that would reduce the quality of the prison experience...that a public prison would not? Food, clothing, hygiene, exercise, library...? The minimum levels of service to be provided are easily specified in the contract between the private supplier and the state. Capital investment? Again, specify the requirements...easy to do. I believe that the states that contract out prison operations do so primarily to get the labor out of the public employee pool. Based on California's experience with the high-salaries and benefits of its politically activist correction employees union that would seem to be a cost reduction that would not diminish service quality.

It would just be simpler to have some more transparent accounting rules for public employees. (1) Every employee receives a 'stated compensation'; (2) retirement benefits are to be had from a defined contribution program wherein a minimum of 15% of an employee's stated compensation is withheld under ordinary circumstances, a minimum of 30% is withheld if that employee is earning credit toward early retirement (which uniformed law enforcement do), where the standard retirement age is adjusted each year so the ratio of workers to retirees is a constant; (3) fringes are to be financed by assessing a fixed percentage of each employee's compensation and each legatee's income to generate a premium pool, with the premium pool to be awarded by competitive bidding to insurance contractor willing to fulfill the contract for the lowest per household deductible; (4) total compensation per worker in a given government is limited to 110% of total compensation per worker among private sector employees in the region wherein the government nestles; and (5) employment contracts for individual persons shall not feature stated compensation of a value higher than the 96th percentile of local private sector compensation per worker unless there's a public hearing beforehand and the contract is re-examined annually.

Why not have public employees annually bid for their jobs, with the low bidder in terms of salary, health care and retirement being hired for the position? That's the way public agencies purchase paper clips, motor fuel, buildings and attack helicopters.

Good idea...let's include college professors in that too.

You may have noticed that people are not equipment. They're not sent to salvage when you're done with them and they make the institutional culture of the agency, which your chairs and paper clips do not. While we're at it, how do you screen who can place a bid?

"They’re not sent to salvage when you’re done with them"

That's true. They're expensively warehoused in buildings where they watch Seinfeld re-runs while ladies that speak English as a second language change their diapers and wipe the spittle from their chins.

In fact, aren't there some parallels between the incarceration of the superannuated and felons?

Oz - federal nursing home!

They’re expensively warehoused in buildings where they watch Seinfeld re-runs while ladies that speak English as a second language change their diapers and wipe the spittle from their chins.

That isn't salvage. They're cared for there because they'e not ambulatory or they're non compos mentis. And, no, most people do not require institutional long-term care before they die (and have long since retired when they do require it).

By the way, you're a piece of waste.

"It would just be simpler..."

Apparently not if the states are resorting to private prison providers to avoid overly high public employee costs.

" And respect for prisoner’s civil rights? That can save on legal bills."

If the idea is a cheaper incarceration experience why shouldn't that idea be extended to legal expenses? Of course the sectarian Levites of the state religion need and deserve maximum compensation in their roles of codification, prosecution, defense, appeal and sentencing so their cooperation is unlikely.

One of the problems with allowing private prisons, that you do not address, is that we essentially created a concentrated industry made up of a small group of firms who have a strong incentive to influence policy with regard to mandatory minimum sentences, continuing the drug war, et cetera. One only needs to read the investment prospectus for a publicly traded private prison company to see where there incentives lie. There incentives may be to cut the marginal cost of imprisoning a single person. But their incentive is also to lobby for maintaining the scale of our prison system.

There's another perverse incentive that can be created by a private prison--there are now people sitting around with a big financial incentive to see more people go to prison at a local level. They could spend their money lobbying, but they could also spend their money bribing a judge to send more kids to their private juvenile detention center. I don't really see how a comparable risk exists for public-run prisons.

Also consider the watery consistency of the fourth amendment and the existence of "parallel investigations" (which, of course, cops deny, and when cops deny that they breaks laws or regulations but refuse any effort to prove so, naturally we should take them at their word).

"But their incentive is also to lobby for maintaining the scale of our prison system."

Is there any evidence that this actual 1 occurs and is 2. effective?

There is clear evidence of lobbying:
https://www.washingtonpost.com/posteverything/wp/2015/04/28/how-for-profit-prisons-have-become-the-biggest-lobby-no-one-is-talking-about/?utm_term=.81340bc17d9e

It would probably be hard to conclusively prove it was effective. The private prison companies themselves would be in the best position to evaluate the efficacy of their lobbying efforts, and they must think they are getting some kind of return on their investment to expend resources on that scale.

To say that private prisons are similar in quality to public prisons is to exclaim your ignorance and inexperience of our prison system. For those of us who come from lower backgrounds and still have close family caught up in that system, there is no prisoner's family ANYWHERE in the US who would prefer a private prison than a public prison, for reasons of quality of life, safety, and rehabilitation options.

Since the very purpose of a prison is to punish the prisoner, we would do very well to not take their considerations into consideration!

> the very purpose of a prison is to punish the prisoner

It always has been, but there are those who are working feverishly to ensure that such a notion is forever banished from modern discourse.

[Indeed, I guarantee you that several people read your comment with horror.]

For those dopes, today's prison is place where people are only inside due to calculated racism. And if those victims can't leave, we better make damn sure they are not inconvenienced in any way while inside. "Punish" them?? Dear God, man.

Some didn't read Foucault. I guess you take Tyler too much to heart.

"no prisoner’s family ANYWHERE in the US who would prefer a private prison than a public prison"

Seems like private prisons are preferable to society then. If they are such he**holes, maybe the "lower backgrounds" will want to stay out of them.

Sounds like logic at the level of "she deserved to get raped because she was wearing a short skirt", but different sort of context.

Do you know of any polling or other data that backs this claim up?

On problem with trying to think about prisons is that criminology is a preaching trade rather than an investigating trade.

It's no more inherently a preaching trade than any other social research discipline. The problem with sociology is sociological: at a seminal moment, red-haze fools reached a critical mass, and successive generations have added to the problem incrementally by driving away normal people and then excluding normal people who wish to study the subject in a process of circular and cumulative causation. Same deal with cultural anthropology.

Can you be more specific? Almost everything I've read in criminology is either data intensive or obstruse philosophy to be consumed at a rate of pages per hour if you're going to have time to draw together all the interconnections and overlappings in the text, and look up the various names dropped from centuries gone by in related subjects.

The claim that public prisons would be higher quality than private prisons implies that quality can be assessed. If it can be measured, then incentives can be placed in the contracts to reward quality. If a government manager is expected to be able to produce higher quality due to some incentive to do so, then a private manager can also and can be given incentive to do so. I suspect the issue is lack of creative thinking on the part of those designing incentives who too easily assume government will do a better job (akin to Michael Munger's comments on the "unicorn government" assumption).

The private prison issue doesn't have quite the same characteristics as the car sales example. In the case of the car sales example, one concern is the potential short term employment of sales people which lowers their incentive to rely on repeat business personally, while the company as a whole may take a longer view. It seems still that some of their compensation could be deferred and provided as a bonus when one of their customers makes a purchase in the future, with the level of the bonus being high enough to overcome the focus on the immediate compensation. Also it seems those high pressure tactics do scare off many people, even if they lead to some closes, so perhaps there could also be a component of compensation for sales people based on the ratio of sales prospects to closes.

PS, I should clarify that a bonus given to a sales person when a customer makes a repeat purchased could be provided even if the car sales person has left the company by then, to reduce concerns over short term employment changing incentives.

If we are measuring prisons shouldn't we also measure recidivism? Wouldn't that measure quality vs cost?

>shouldn’t we also measure recidivism?

Nope. For those employed by the criminal justice system, it's a feature, not a bug.

If you arrest a vicious criminal at age 21, and then lock up him for life, where's the profit? You want him cycled through the court system and then quickly set free at least 10-15 times.

It may seem stupid, and it gets a lot of people hurt or killed, but you can gloss over this by appealing to the public's sense of "rehabilitation." And then the right people get nice pensions out of it.

Apples to oranges. The DA is not running prisons. Try harder with your troll please.

"Apples to oranges. The DA is not running prisons. Try harder with your troll please."

DA's are promoted by successful cases. Which translates to high numbers of conviction rates. So, yes they aren't running prison, but they are incentivized to stock them.

So what you're saying then, is that it is an apples to oranges comparison. Thanks for agreeing with me.

Nonsense. There is no such thing as a court with a lack of cases to hear.

Is there a measured difference, once prisoner characteristics are accounted for, between recidivism rate for private and public prisons?

Great question. Sounds like something Alex or Oliver would have asked if they cared about quality work and learning something.

"about 5 percent of all prisoners"

To hear your standard "progressive" wailing about the "prison industrial complex", it is 95%

There are the various unions and suppliers, etc., who also have their own concentrated interests.

If you were to sum up the amount of activities performed by concentrated interests with professional lobbies at their backs which promote the long-term income potential of their members, honestly, 95% might not be all that far from correct.

Who in that system serves to protect taxpayers, who those who will benefit from lower recidivism, whether through safer streets, non-absentee parents or improved labour supply?

One of Nobel prize-winner Oliver Hart’s

Hart is not a "Nobel prize-winner". He was awarded the Sveriges Riksbank Prize. There is no Nobel Prize in economics.

Assuming the figures I've heard regarding percentage of inmates who have only been convicted of drug possession are even remotely accurate, it seems the most expedient means of reducing costs with minimal impact on quality, however you wish to measure that, would be to simply restrict prison sentences to those who are too dangerous to be allowed in mainstream society.

I also don't agree with the notion that punishment should be an explicit goal of prisons, or of criminal law in general. It is my belief that the first priority of any system of criminal law should be to minimize the number and severity of crimes committed with other priorities being to help victims recover and to minimize the likelihood that a criminal will become a repeat offender. If punishment is to enter the equation, it should serve these ends rather than being an ends in itself. I'm not convinced punishment, as dished out by the US Legal System during my lifetime, serves these ends in even a quarter of cases and I fear that cases where punishment runs contrary to these ends outnumber cases where punishment serves these ends.

That said, based on my limited knowledge, I like how Norway handles their prisons and wish there were more Americans willing to try Norwegian style prisons in the hopes we could replicate their successes. There might be some underlying cultural or genetic factors at play, but the US and Norway being, as I understand it, at opposite ends of the spectrum for repeat incarcerations(the US at the high end and Norway at the low end) among developed nations strikes me as a decent indicator they might be doing something right while we're doing something wrong.

An optimal system of much complexity at all (criminal justice certainly qualifies) does not minimize much of anything. It balances costs and benefits of various types.

Where the balance lies right now, I'd rather take my risk at a 1 in a million higher chance of dying in terrorism (probably lower with entrapment efforts and inducement from police) or whatever else than having the FBI, NSA and who knows who else peering over my shoulders around the clock for no (credible) good reason that anyone can fathom or put to paper.

I hope you're not a victim of crime tomorrow. But damn straight, I support a 0.000000000001% increase in your probability of suffering from a violent crime tomorrow in exchange for freedom from what is for all intents and purposes more a police state with nearly every passing day.

For national security, information systems were combined in a million ways. In order to maybe catch a couple bad guys a year, now there are a million holes which more information than anyone could have been stupid enough to put in the same place decades ago, at a time when criminal and/or government groups with the ability to pilfer and abuse that info also expand with every passing day.

Are they here for our security? Look into what the debates are in IT security, and you will easily conclude that the FBI would happily sell out the IT security of the entire nation if it would bag them a few more induced terrorists to justify their budget. In fact, that is precisely what they are lobbying for right now. Back doors into every device, and a law that basically gives them the right to eternally invade your life in every way if you are found to take basic measures for privacy (VPN, TOR, etc.).

Welcome to the police state. The wrong people keep you awake at night. The lunatics are running the asylums.

Should private prison be given incentives to reduce recidivism?

I sure hope a lot of smart people will be hitting themselves in the head, wondering why this question hasn't been first and foremost the whole time.

I'm very skeptical at the possibility of private prisons to do a good job of what society wants them to do without such excessive regulation and oversight as to make it more practical to just have the government do it in the first place. BUT, since quite a lot of people seem quite intent on persisting with this experiment, considered borderline insane by quite a lot of people in lots of places, then YES, THIS IS EXACTLY THE QUESTION THAT PEOPLE NEED TO BE ASKING!

But, don't count on me to make that argument a bunch of times. I want them gone, and my guess is that moves in the direction of what you suggest would largely revolve around buying time before doing nothing.

One data point but a pretty damning one:
http://www.motherjones.com/politics/2016/06/cca-private-prisons-corrections-corporation-inmates-investigation-bauer

The data? How about losing your legs because the onsite medical team won't send you to the hospital! If you're not prepared to measure quality how are you even presuming to have an opinion? http://www.motherjones.com/politics/2016/06/cca-private-prisons-corrections-corporation-inmates-investigation-bauer

Neither HSV nor the critique go into the institutional aspects of privatisation of a state function - regulatory/ state capture. There's incentives on costs, but what about incentives on getting funds from state agencies by increasing # of inmates (and utilising part of the proceeds to incentivise local PDs to keep providing inmates).

Similar to how a lot of money in charities is spent on overheads like cupcakes and cardboard cutouts and opeople to make cupcakes and cardboard cutouts so that donors can feel good.

The overall spend on actual prison operations is likely to be asymptotically bounded.

My solution to the problem of private prisons providing poor inmate environments would be to allow prisoners limited choice of which prison they enter. That way some prisons could operate prison industries and prisoners could voluntarily enter those prisons, learn a trade, and even earn income (which could be shared with family or victims). Clearly this would require that prisons be monitored to make sure that they did not attract innates with drugs, or other undesirable inducements but that is a problem with today's prisons even if the choice of prison is not open to inmates. Again I am calling for limited choice - maximum security would still be maximum security. I would not that this works to discipline private provisions of motels, camps, and even colleges.

A variety of shortcomings and scammy things could come from such an idea, in addition to additional problems with the segmentation on such criteria. But all the problems that come to mind are very much in the realm of things that can be addressed with not toooo much difficulty or cost, and the effects this might have on prison quality and especially long-term recidivism, could be very beneficial.

There are some prisoners' rights groups (ACLU often takes up their situation) which might be interested in taking up the argument ...

http://www.dailymail.co.uk/news/article-2932394/Life-inside-Brazil-s-violent-prison-inmates-beheaded-hundreds-died-armed-military-police-guns-ready.html

I don't think private prisons in Brazil would show just a little bit higher quality than Pedrinhas prison

Now that I've given it some more thought, I think we should have "charter prisons". Offer the same flat rate for all public and private prisons, and give the prisoners the right to choose which prison in which they are incarcerated. Prisoners might select the Thorson Corporation prisons because they get bacon every morning and two beers on Sunday evening.

Like charter schools, let the charter prisons cherry-pick the best prisoners, so prisoners have a reason to behave well to get into a good prison. Ding the compensation to the prison for any "reportable incidents" like assaults. This would align the incentives with good behavior all the way around -- the prisoner heirarchy would enforce good behavior so they get extra beer. Management would provide reasonable food and even-handed guards so prisoners would choose to attend their prisons.

The idea that we can't measure quality metrics like prisoner rehabilitation seems strange. It more about willingness to use the metric than about the ability to measure it.

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