Today Nevada Workers Lose Jobs to Inmates – Next it Could be your Turn

Third and final segment of the series on Nevada’s situation involving unfair competition by use of prisoner labor
by Bob Sloan, Executive Director, VLTP.net
Jan. 25th 2013

“Insourcing”..: there is no current definition for this word in our Urban Dictionary or Websters. I plan to change that by defining in detail the concept of insourcing and who is responsible for the practice of it. First we must compare the word to its cousin, Outsourcing.

Society today is familiar the term “Outsourcing.”  When used in connection with manufacturing it means a company sending work outside the business and having it performed utilizing the labor or expertise of others.  Since the mid ‘80’s most realize to American workers, it really meant sending millions of our jobs overseas where foreign labor was cheap and plentiful.

Not so well understood is the term “Insourcing” – Insourcing is is widely used in production to reduce costs of taxes, labor and transportation.  Insourcing describes the process used by corporations to remove jobs from private sector labor markets and “Insource” them to prison industry operations here in the U.S.  This allows for profits more in line with outsourcing, but eliminates the necessity for expensive transportation costs to return the finished goods to U.S. consumers – it also allows manufacturers to attach labels to their goods marked “Made In The U.S.A.”

Insourcing of jobs is the “quiet” elimination of private sector jobs by transfer to prison industries.  Corporations wishing to participate in using prison labor, partner with prison industry operations under the federal Prison Industries Enhancement Certification Program (PIECP or Pie Program).  18 USC 1761(c) is the controlling federal statute of PIECP. Though private sector corporations are prohibited from closing private sector operations in favor of prison operations, they do so without consequence. There are other mandatory requirements that must be followed in order to participate in PIECP, but those also are rarely enforced.

The way these prison partnerships typically work is that a manufacturer wanting to increase profits moves their equipment, technology, materials and unfinished goods to a factory setting within a prison industry facility.  Once up and running, the same products come off the assembly lines and are shipped as before. The difference is this, private sector employees of the company have been terminated or laid off. A handful of employees are usually kept on long enough to train inmates and prison supervisors in the manufacturing used to make the products. Once that is accomplished, they are also eliminated and their positions taken over by a prison industry supervisor.

This Insourcing of labor creates quite a number of unemployed citizens. Burdens are placed on state and community social help programs, unemployment compensation, etc. So while the corporation saves lots of money in labor costs – no more unemployment insurance premiums, less expenses in lease of facilities (usually leased by the prison operators at $1.00 per year), and no more employee benefits such as medical insurance, vacations or paid time off – the communities they vacated are left to fund the displaced unemployed workers. In addition the local government loses taxes that were paid by the corporation, previous landlords of the facilities once leased to the corporations are left with vacant property and local shops and other businesses suffer a drop in sales due to the newly unemployed workers left behind.
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In the two previous segments I have talked about the current situation in Las Vegas involving the discovery of prison labor used in the manufacture of products used in the construction of major projects. The developers and or investors involved in these new construction projects in Las Vegas are all influential, well connected; Andre Agassi, SPB Capital Partners, family members of Thomas & Mack Center and the Bulloch family – all well known to the citizens of Nevada.

To many this was a “new” discovery – the use of prisoners as a cheap labor force.  But this practice has been ongoing now for years, and in particular since 1998 when major movers and shakers in the world of politics, finance, manufacturing and prison operations converged in Washington to discuss “innovative strategies for Prison Industries” and “Policies and Programs in Prison Industries.”

Participants included: the CEO of Prison Rehabilitative Industries and Diversified Enterprises (PRIDE), the first private corporation formed to operate Florida’s entire prison industries; U.S. Attorney General, Janet Reno; Florida Representative Bill McCollum, Texas Representative Ray Allen and a business owner of Genoex, one of the first private corporations to eliminate American workers, replacing them with prisoners.
PRIDE’s CEO was Pamela Jo Davis, the darling of Florida’s newest Governor-elect Jeb Bush, and she also “just happened to be” the Chairwoman of the National Correctional Industries Association (NCIA), a trade group representing prison industries, industry vendors, suppliers, workers and companies using prisoner labor in manufacturing.  Representative Allen (R-TX) was soon to become Chairman of the House Committee on Corrections– and also “just happened” to be a member of the American Legislative Exchange Council (ALEC), serving on their criminal justice task force.  Allen again, “just happened” to also be a registered lobbyist for the NCIA.

This NCIA also “just happened to be” the private association the U.S. government had outsourced oversight of the PIECP to in 1995.

It was this happy group of industrialists, politicians, lobbyists, program regulator and prison industry authorities who met in DC in ’98 to discuss just how prison labor could be exploited – legally, of course – to reduce wages to American private sector workers and increase profits to business owners.  First thing was to find a way to make their actions legal and in order to expand; a means was needed to propose such legislation in every state.  These were the responsibility of ALEC.  With more than 2,000 legislative members representing every state, ALEC had a proven track record (going back more than two decades) of enacting and passing model legislation written by their corporate members.

How about federal laws?

Read the rest here: http://www.vltp.net/rape-of-americas-workers-crime-victims-now-prisoners-given-their-jobs/

Prison Economics Help Drive Ariz. Immigration Law

NPR
by Laura Sullivan for NPR
October 28, 2010

Picture: Glenn Nichols, city manager of Benson, Ariz., last year two men came to the city “talking about building a facility to hold women and children that were illegals.”

Last year, two men showed up in Benson, Ariz., a small desert town 60 miles from the Mexico border, offering a deal.

Glenn Nichols, the Benson city manager, remembers the pitch.

“The gentleman that’s the main thrust of this thing has a huge turquoise ring on his finger,” Nichols said. “He’s a great big huge guy and I equated him to a car salesman.”

What he was selling was a prison for women and children who were illegal immigrants.

“They talk [about] how positive this was going to be for the community,” Nichols said, “the amount of money that we would realize from each prisoner on a daily rate.”

But Nichols wasn’t buying. He asked them how would they possibly keep a prison full for years — decades even — with illegal immigrants?

“They talked like they didn’t have any doubt they could fill it,” Nichols said.

That’s because prison companies like this one had a plan — a new business model to lock up illegal immigrants. And the plan became Arizona’s immigration law.

Behind-The-Scenes Effort To Draft, Pass The Law

The law is being challenged in the courts. But if it’s upheld, it requires police to lock up anyone they stop who cannot show proof they entered the country legally.

When it was passed in April, it ignited a fire storm. Protesters chanted about racial profiling. Businesses threatened to boycott the state.

Supporters were equally passionate, calling it a bold positive step to curb illegal immigration.

But while the debate raged, few people were aware of how the law came about.

NPR spent the past several months analyzing hundreds of pages of campaign finance reports, lobbying documents and corporate records. What they show is a quiet, behind-the-scenes effort to help draft and pass Arizona Senate Bill 1070 by an industry that stands to benefit from it: the private prison industry.

(photo: Arizona state Sen. Russell Pearce)
Arizona state Sen. Russell Pearce, pictured here at Tea Party rally on Oct. 22, was instrumental in drafting the state’s immigration law. He also sits on a American Legislative Exchange Council (ALEC) task force, a group that helped shape the law.

The law could send hundreds of thousands of illegal immigrants to prison in a way never done before. And it could mean hundreds of millions of dollars in profits to private prison companies responsible for housing them.

Arizona state Sen. Russell Pearce says the bill was his idea. He says it’s not about prisons. It’s about what’s best for the country.

“Enough is enough,” Pearce said in his office, sitting under a banner reading “Let Freedom Reign.” “People need to focus on the cost of not enforcing our laws and securing our border. It is the Trojan horse destroying our country and a republic cannot survive as a lawless nation.”

But instead of taking his idea to the Arizona statehouse floor, Pearce first took it to a hotel conference room.

It was last December at the Grand Hyatt in Washington, D.C. Inside, there was a meeting of a secretive group called the American Legislative Exchange Council. Insiders call it ALEC.

It’s a membership organization of state legislators and powerful corporations and associations, such as the tobacco company Reynolds American Inc., ExxonMobil and the National Rifle Association. Another member is the billion-dollar Corrections Corporation of America — the largest private prison company in the country.

It was there that Pearce’s idea took shape.

“I did a presentation,” Pearce said. “I went through the facts. I went through the impacts and they said, ‘Yeah.'”

Drafting The Bill

The 50 or so people in the room included officials of the Corrections Corporation of America, according to two sources who were there.

Pearce and the Corrections Corporation of America have been coming to these meetings for years. Both have seats on one of several of ALEC’s boards.

Key Players That Helped Draft Arizona’s Immigration Law

Source: NPR News Investigations

Credit: Stephanie D’Otreppe/NPR

And this bill was an important one for the company. According to Corrections Corporation of America reports reviewed by NPR, executives believe immigrant detention is their next big market. Last year, they wrote that they expect to bring in “a significant portion of our revenues” from Immigration and Customs Enforcement, the agency that detains illegal immigrants.

In the conference room, the group decided they would turn the immigration idea into a model bill. They discussed and debated language. Then, they voted on it.

“There were no ‘no’ votes,” Pearce said. “I never had one person speak up in objection to this model legislation.”

Four months later, that model legislation became, almost word for word, Arizona’s immigration law.

They even named it. They called it the “Support Our Law Enforcement and Safe Neighborhoods Act.”

“ALEC is the conservative, free-market orientated, limited-government group,” said Michael Hough, who was staff director of the meeting.

Hough works for ALEC, but he’s also running for state delegate in Maryland, and if elected says he plans to support a similar bill to Arizona’s law.

Asked if the private companies usually get to write model bills for the legislators, Hough said, “Yeah, that’s the way it’s set up. It’s a public-private partnership. We believe both sides, businesses and lawmakers should be at the same table, together.”

Nothing about this is illegal. Pearce’s immigration plan became a prospective bill and Pearce took it home to Arizona.

Campaign Donations

Pearce said he is not concerned that it could appear private prison companies have an opportunity to lobby for legislation at the ALEC meetings.

“I don’t go there to meet with them,” he said. “I go there to meet with other legislators.”

Pearce may go there to meet with other legislators, but 200 private companies pay tens of thousands of dollars to meet with legislators like him.

As soon as Pearce’s bill hit the Arizona statehouse floor in January, there were signs of ALEC’s influence. Thirty-six co-sponsors jumped on, a number almost unheard of in the capitol. According to records obtained by NPR, two-thirds of them either went to that December meeting or are ALEC members.

That same week, the Corrections Corporation of America hired a powerful new lobbyist to work the capitol.

The prison company declined requests for an interview. In a statement, a spokesman said the Corrections Corporation of America, “unequivocally has not at any time lobbied — nor have we had any outside consultants lobby – on immigration law.”

Read more here

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Produced by NPR’s Anne Hawke.

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