How much difference does an election make? Well, when President Barack Obama announced in August that he was phasing out the use of some for-profit prisons in the federal system, stocks of publicly traded prison operators plunged. On Nov. 9, however, the day after the election of Donald Trump, they rebounded heavily, buoyed by the president-elect’s campaign support.
Trump is not just a supporter of for-profit prisons, but for privatizing a whole host of government services, including public infrastructure and veterans health care, and it is clear his Cabinet of billionaire CEOs see profit motivation as a powerful force.
But while the pursuit of profit may lead to innovation and efficiency in many sectors, it has overrun quality of care and basic ethics in others. For-profit prisons, colleges and health care have been a failure in so many ways, leaving Americans awash in debt and misery, and any attempt to commit public funds to those entities should be met with great skepticism.
Obama’s move on for-profit prisons came following an inspector general’s report that showed that in the federal system, for-profit prisons did not save much on cost and did not positively affect recidivism rates. What’s more, inmates in these prisons were more likely to have weapons than their counterparts in publicly run prisons, and there were more assaults on inmates and guards and 10 times more lockdowns.
The record is just as spotty on for-profit colleges, the worst of which used illegal and unethical tactics to draw students into programs they could not afford to gain degrees that had little success earning people jobs, one of the main drivers of the student debt crisis.
A study by the nonpartisan Government Accountability Office covering 15 for-profit schools in six states and Washington, D.C., found that all 15 “made deceptive or otherwise questionable statements” to applicants, exaggerating employment prospects and graduation rates, and falsifying financial aid forms.
Another found that 98 percent of the more than 800 vocational programs across the country that failed to place graduates in jobs good enough to repay their loans were at for-profit schools; not one program at a community college made the list.
In short, many of these colleges recruited students using unethical tactics in order to draw federal student loans, which then became the responsibility of taxpayers when the students couldn’t find work and defaulted on the loans.
And at for-profit hospitals, a RAND Corp. study found higher mortality rates, while researchers at University of Wisconsin-Madison found for-profit nursing homes more frequently used sedatives, which are less costly than using personnel to handle difficult patients.
Those experiences should weigh heavily on any attempt to house prisoners, teach students or treat patients through for-profit companies. That includes the plan from the LePage administration to build a privately run facility for some of the mental health patients now at Riverview Psychiatric Center.
For-profit companies may excel at building a better widget or finding the best way to get it to market. But in other cases, the urge to cut corners is just too great, and when oversight falls short, people suffer.