You Know What Doesn’t Work So Well? Private Prisons

The myth put forth by private prison corporations like Corrections Corporation of America (CCA) and the GEO Group that private prisons are cheaper than public prisons is shattered by a new report from In the Public Interest, thus undercutting the primary rationale for prison privatization efforts across the country. When pushing for contracts with the many states that use private prisons, these corporations claim they are the better option because they can run prisons more cheaply than the government can. But this report not only dispels that idea, it highlights some of the less-than-savory activities the corporations engage in because of the perverse incentives created by these contracts.

The report details several methods through which private prison companies mislead governments and the public about their supposed cost savings, particularly hiding costs of private prisons, inflating public prison costs, benefiting from mandated occupancy minimums and delaying cost increases until after contracts are signed.

Numerous studies have shown that private prisons are more expensive than their publicly run counterparts. The report details a series of meta-analyses of individual studies conducted on the comparative costs between public and private prisons, and all of them found that cost savings, at best, were minimal for private prisons—in many cases, private prisons were more expensive. One of the few studies that showed private prisons to be more cost-effective was funded by the prison companies and is currently the subject of an ethics inquiry at Temple University. A close examination of many of the states that have invested heavily in prison privatization has shown the failure of the “private prisons are cheaper” idea:

  • Arizona: The state found private prisons can cost up to $1,600 per prisoner per year, despite private prisons often only housing the healthiest prisoners.
  • Florida: Three separate multiyear studies found the majority of the private prisons in the state failed to meet the legally mandated 7% cost savings, while half of the private prisons failed to save any money at all.
  • Georgia: In 2011, private prisons cost the state $45.81 per prisoner per day, compared with $44.51 per prisoner per day in publicly run prisons.
  • Hawaii: The state found the projected savings of using private prison contractors were based on bed capacity rather than the actual number of people incarcerated and that indirect administration costs were not included.
  • New Mexico: Over a five-year period, the state saw its annual spending on private prisons increase by 57% while the prisoner population only increased 21%. A significant portion of the increase was because of automatic price increases included in contracts with the private prison corporations.
  • Ohio: The state expected the private operation of the Lake Erie Correctional Institution would save the state $2.4 million a year, but it has turned out to instead cost the state $380,000 to $700,000 a year.

As the report notes:

To maximize returns for their investors, for-profit prison companies have perverse incentives to cut costs in vital areas such as security personnel, medical care and programming, threatening the health and safety of prisoners and staff.

There are several different reasons that savings fail to materialize. CCA and other companies explicitly seek to increase their profits by changing the details of previously signed contracts. They do this by raising the per diem rates the state pays for each prisoner or by requiring occupancy rates of 90% or higher or the state pays for the empty cells in order to reach the required level. Private prison companies cherry pick their inmates and refuse to house more expensive prisoners. Many contracts exclude those higher-cost prisoners, such as those in maximum security, on death row, female prisoners or prisoners that have serious medical or mental health conditions. Companies also make their costs look lower by inflating the cost of public incarceration when making their sales pitch. They can do this by leaving out overhead costs in their prisons, not including costs the state has to pay in either public or private scenarios in the private prison cost but keeping them in the public prison cost calculation, and leaving out the additional costs of overseeing and monitoring private prisons that the state must engage in if it properly oversees its contractors.

At its national convention last year, the AFL-CIO came out in opposition to the privatization of prisons and the profit motive being used to increase incarceration.

Read the full report.

Reposted from AFL-CIO NOW

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AFSCME Snowplow Driver Rescues Man from Crashed, Snow-Filled Car

AFSCME  photo

When a winter storm roared through Minnesota last month, snowplow driver Jeff Holte—a member of AFSCME Local 789—was clearing Interstate 94 and spreading sand near Evansville, Minn. But temperatures plummeted and, in a matter of minutes, Holte watched the road go from perfectly safe to a sheet of ice.

He also saw a car lose control, roll into a ditch and, with its rear window broken and upside down, slide backward through previously fallen deep snow that nearly filled the car. That’s when he sprang into action, writes David Kreisman on AFSCME’s News blog.

After calling the state police, Holte ran to the car where a woman had escaped.

She came running up out of the ditch pretty frantic. She was screaming that her boyfriend was still trapped in the car packed with snow and he was having trouble breathing because the car was so full of snow.

Read how Holte dug enough snow from the car to belly crawl to the front seat, where he removed more snow from around the trapped man to enable him to breathe, and eventually unbuckled the seat belt and pulled him from the car.

Says Holte:

It was kind of a wild few minutes there when it happened. I’m just glad I was in the right place at the right time to help them.

Reposted from AFL-CIO NOW

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The Real Reason Detroit Went Bankrupt

As the story goes, the city of Detroit went bankrupt because of $18 billion in long-term debt, in large part caused by pension and health care benefitsA new report, written by Wallace Turbeville and released today from Demos, says that narrative is inflated, inaccurate and irrelevant to explaining the city’s bankruptcy.

Despite what the city’s emergency manager Kevyn Orr, who was hired by Gov. Rick Snyder (R), says, the $18 billion figure is not relevant to the city’s bankruptcy. To emerge from the bankruptcy, according to chapter 9 of U.S. bankruptcy code, Detroit only needs to address its cash flow shortage, a number that even Orr sets at only $198 million. But that number, much like the $18 billion number, is inflated because it goes with extremely aggressive assumptions for economic trends that are very unlikely to represent what really happens.

When projecting costs, governments often create several projections, often reflecting best-case scenarios, worst-case scenarios and some moderate position in between those two. Governments usually choose the moderate option in order to determine their budget projections. But Orr, Turbeville says, has chosen the worst-case scenario and isn’t at all based on a certain liability that the city will face. Furthermore, Orr includes in that total nearly $6 billion of debt from the Water and Sewage Department debt as city liability, despite the fact that this liability is based on an area much broader than the city. The department covers 3 million people in southeastern Michigan, not just the slightly more than 700,000 people who actually live in Detroit.

Turbeville notes that the city’s operating expenses have declined by 38% since the beginning of the Great Recession. During that same time, the city’s pension obligations only rose by $2 million. Health care expenses increased by 3.25%, less than the national average of 4%. The biggest proportion of increased costs for the city actually comes from debt service and financial expenses related to complex Wall Street investments that amounts to more than pension and health care increases combined. Other key components of the city’s deficit are:

  • A significant decline in revenue based, in large part, on the city’s declining population, which contributed to declines in tax revenue and property values.
  • A decline of $67 million in state revenue sharing with the city.
  • As much as $20 million annually in corporate subsidies that have provided questionable benefits to Detroit.

The report concludes:

Detroit’s bankruptcy is, at its core, a cash flow problem caused by its inability to bring in enough revenue to pay its bills. While emergency manager Kevyn Orr has focused on cutting retiree benefits and reducing the city’s long-term liabilities to address the crisis, an analysis of the city’s finances reveals that his efforts are inappropriate and, in important ways, not rooted in fact. Detroit’s bankruptcy was primarily caused by a severe decline in revenue and exacerbated by complicated Wall Street deals that put its ability to pay its expenses at greater risk. To address the city’s cash flow shortfall and get it out of bankruptcy, the emergency manager should focus on increasing revenue and extricating the city from these toxic financial deals.

Read the full report.

Reposted from AFL-CIO NOW

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Tea Party Ballot Measure Absolutely Crushed by Ohio Voters

An overhaul of Cincinnati’s pension system backed by the Tea Party was thoroughly crushed on Tuesday. Cincinnati voters rejected the charter amendment, known as Issue 4, by a 57-point margin.

Issue 4 was placed on the ballot by a private group known as the Cincinnati for Pension Reform Committee. It would have required the city to pay off its $872 million unfunded liability in the current pension system within 10 years, or find cost savings or new revenue elsewhere to make up the difference.

Making up that huge gap, exacerbated by the 2008 financial crisis, is nearly impossible in 10 years. That’s the point: Issue 4 was a barely concealed attempt to force cuts to public services in Cincinnati, and generally pit the city’s citizens against the workers who make it run.

The city is already taking steps to address the $872 million liability in a number of ways–and as with most cities, the public workers themselves are bearing the brunt. Issue 4 would have put those changes on steroids, and would have lead to either tax increases or cuts to public safety and city services: closed firehouses, slower emergency response times, and staffing shortages when we need help the most.

It’s no wonder then that opposing Issue 4 united unlikely allies: the Chamber of Commerce, AFSCME, firefighters, and the editorial board of the right-leaning Cincinnati Enquirer. “Today’s vote will be heard beyond Cincinnati and sends a message for those on the ideological extremes who think it is ok to impose their agenda on an entire city,” said Peter Linden of AFSCME Ohio Council 8, “Had this passed, outside money and political extremists would have cost Cincinnati taxpayers more money, with less services.”

It’s been two years since Ohio voters of all political stripes overturned Gov. John Kasich’s Senate Bill 5, which stripped collective bargaining from over 300,000 public workers. It’s been one year since Ohio voters chose pro-worker Senator Sherrod Brown over the Tea Party-affiliated Josh Mandel. Since that time, the effort to get a so-called “right to work” on the 2014 Ohio ballot has faltered, collecting less than a third of the signatures needed in 20 months.

It’s time that the corporate-backed anti-worker forces in Ohio get it through their heads that Ohioans are interested in more jobs and a stronger economy; not fewer rights at work, fewer public services, and attacks on the workers who are already making the most sacrifices.

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Detroit Retiree Invites Governor Snyder Over for Dinner

Donald Smith is one of the 21,000 retired public workers in Detroit facing pension and health care cuts in the wake of Michigan Governor Rick Snyder and Detroit Emergency Financial Manager Kevyn Orr’s management of the city bankruptcy.

Detroit public workers have already made sacrifices to keep the city afloat, including a $160 million in annual savings from a 10 percent pay cut, health benefit reductions, and a 40 percent cut in future pension benefits, Orr is making public worker pension cuts a key part of Detroit’s restructuring.

Remember, Orr was appointed by Gov. Snyder to be “emergency financial manager,” a position that does not answer to voters yet can overrule any local elected official. Michigan repealed the governor’s ability to appoint such managers in 2012, but Snyder and the legislature simply passed the law again.

Donald Smith decided Snyder needed to see a human face on Orr’s proposed cuts. He wrote to the governor:

Dear Governor Snyder,

My name is Donald Smith and I worked for the city of Detroit for more than 29 years.

Over close to 3 decades of service to the city earned me a pension of about $800 a month.  After taxes and health care expenses are taken out, I am left with very little money each month to pay my rent, buy groceries and to cover my medical prescriptions.

Because of your decision to force Detroit into bankruptcy, I am starting to wonder which of my basic I needs can live without.  I did not bankrupt Detroit – in fact, I went to work every day to make it a better place to live. So I can’t understand why you would ask retirees like me to give up the pension benefits we earned.

If you believe that we can afford to make do with less, then you must not know us. That’s why I want to invite you to my home so you can get to know me and see what life is like for retired city employees.  I hope you’ll join my family for dinner and hear what really matters to us in Detroit.

We are willing to work around your busy schedule.  We look forward to sharing a meal and our perspective with you.

Smith gets $800 a month from his public pension and $1,000 a month in Social Security. “Sometimes I have to make up my mind between getting my medicine and food,” he told WXYZ.

Gov. Snyder refused the invitation when asked.

Take Action: Tell Gov. Snyder to protect Detroit public employee pensions.

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5 Shutdown Stories You Need to Read. Tell Us Yours

The nearly two-week-old government shutdown, engineered by House tea party Republicans, is hurting everyday working people and their families. The 800,000 federal workers and tens of thousands of government-contracted employees shut out of their jobs and others forced to work without pay perform vital duties for the public and now are struggling to keep roofs over their heads and food on their tables.

Here are five stories you need to read from shut-out workers and about shut-down services. Click here to share your story with us. We need to make sure the GOP understands who is hurt every day this shutdown continues.

Ona is a furloughed worker from a nuclear waste cleanup site in Georgia.

We were sent home on Oct. 3 and told not to come back until called back. This could be weeks….These people are the hands-on workers that are well trained to perform the difficult tasks of shutting down these waste tanks and setting things right so their kids and their kids’ kids don’t have to deal with it years down the road….I will not be surprised if some of them do not make it back and we will have lost some very well-trained and dedicated workers to this furlough situation.

Read more from Ona.

Jessica’s husband is the sole source of income for the California couple.

He works for a military base about half an hour from our home. After dealing with six weeks of furloughs from sequestration and losing $1,100/month, we fell behind in bills. Because of the shutdowns, we are now looking at our phones being shut off, cable and Internet being shut off and being left with no choice but to voluntarily repo our car.

Cesar is a furloughed federal worker in Florida.

I am the sole income earner in my family. I have two boys, and contrary to what is being said by right-wing talk show hosts, I and many of my fellow federal colleagues do not earn six-figure salaries. We are in the process of buying a home, and I will now have to dip into money that we have saved up to buy our home to get by until Republicans decide to re-open our government.

Read more from Cesar.

Emily is a young furloughed federal worker in Washington, D.C.

The sequester and now the shutdown have been disheartening and have strained my finances to the point that I will need to borrow from my parents—out of their retirement fund—to make rent. I’ve also had to put off seeing specialists for a chronic health issue that won’t quite be covered by my high-option insurance plan. Financial strain aside, public service is my passion, not just how I earn a paycheck—I love my job and just want to get back to work, doing my utmost to serve my fellow Americans and protect the environment for us all.

David is an organizer in New York.

I have been working with a group of residential workers who have been fighting for a year to form a union. The company has committed numerous illegal acts, attempting to intimidate and threaten workers. One employee illegally had his hours cut. The National Labor Relations Board just filed a complaint and was close to a settlement that would have gotten this worker over $1,500 in back pay that the company had kept from him. But with the shutdown, this worker won’t get his money any time soon. Additionally, the board cannot process the new charges filed. Justice delayed is justice denied.

Click here to share your story with us.

Photo from AFGE on Facebook

Reposted from AFL-CIO NOW

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My Grandfather Spent 20 Years Working In A Detroit Factory


My grandfather spent 20 years of his life working in a Detroit factory.

He worked hard for what he earned. He trusted that sacrificing some of his pay to invest it in a pension would pay off after years of hard work. So that’s what he did. He retired, and his pension allowed him to provide for himself and my grandmother.

He and his coworkers knew that the pensions that they invested in were a valuable part of their income, not just a handout from their employer.

Right now, in Detroit, Emergency Financial Manager Kevyn Orr doesn’t see pensions the same way.

A quick review: In 2011, Gov. Rick Snyder and his allies in the Republican-controlled legislature passed a bill allowing entire cities to be taken over by “emergency financial managers.” These EFMs, appointed by the governor, were allowed to completely overrule decisions made by local elected leaders.

In the 2012 election, Michigan voters decisively overrode the EFM law. Gov. Snyder and the legislature responded simply by passing another one.

In March, Snyder chose lawyer Kevyn Orr to single handedly manage the city of Detroit. From the beginning, it didn’t seem that Orr had his priorities in order. He said the city had been “dumb, lazy, happy, and rich,” while unapologetically living large in a penthouse, ordering room service, and employing an assistant at $225,000 a year.

In September, Orr proposed a sweeping wage freeze and essentially privatizing public employee pensions. Orr’s spokesperson suggested that city workers do not contribute at all to their pensions.

What Orr isn’t saying is what these workers sacrificed to protect their pensions. They accepted pay cuts, health insurance cuts and cuts to future pension benefits just to guarantee that the pensions they had worked a lifetime for would be there for them when they retired.

This is unacceptable, and we need to do better.

We can’t allow the wealthy elite like Snyder and Orr to take away hard-earned income from working families. Workers like my grandfather worked, saved, and sacrificed for years to make sure their pension would be there. It’s not a piggy bank for Orr and his rich friends to play with.

We need to send Snyder a message now and demand that he respects Detroit city workers.

Together, we can hold leaders like Gov. Snyder accountable and stand up for all working people in Michigan.

Send a message now.

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House Republican Shutdown Puts Travelers, Workers and All of Us Who Eat at Risk


Last week, we gave you a dozen examples of the vital work that locked-out federal employees are being prevented from doing, thanks to the irresponsible House Republican government shutdown now in its second week. Republican House leaders are still refusing to do the right thing and allow a vote on funding and reopening the government.

Here’s a look at a few more of the jobs that shut-down workers—or those still on the job but not getting paid—perform and some of the key government services we all count on that are idled.

Every day, tens of millions of Americans are in the air, on the rails and roads and on buses and subways expecting safe travel, but likely giving little thought to the federal workers whose job it is to get them safely from point A to point B.

The Federal Aviation Administration has furloughed 3,000 aviation safety inspectors. The inspectors check to make sure airlines are maintaining their planes safely, conduct inspections at airports of planes and pilots and visit domestic and foreign repair stations where airlines send planes for major overhauls, among other safety jobs. Other aviation experts are on the job but without pay.

On Tuesday evening at Bradley International Airport in Windsor Locks, Conn., aviation specialists from the Professional Aviation Safety Specialists (PASS) and from unions of the Connecticut AFL-CIO staged an informational picket to alert the flying public about the possible safety issues because of the Republican government. Says PASS President Mike Perrone:

Sidelining aviation safety inspectors, who are crucial employees, for even a day is unacceptable and exposes the aviation system to unnecessary risk… Congress must immediately work to end the shutdown and put an end to undermining the critical work these inspectors perform.

Members of the National Air Traffic Controllers Association (NATCA) are in the towers and control centers still guiding you safely home but are doing so without pay. Says NATCA President Paul Rinaldi:

The uncertainty created by this shutdown is only adding to an already stressful work environment. Promises of back pay amount to nothing more than IOU’s while bills pile up and frustration mounts

Because of the irresponsible shutdown that House Speaker John Boehner  (R-Ohio) engineered, nearly all investigators at the National Transportation Safety Board have been locked out of their jobs and are unable to search for causes of several recent fatal accidents, including a Tennessee bus crash that left eight people dead and 14 more injured, a plane crash that killed four in Santa Monica, Calif., and an explosion in a Washington, D.C., Metro tunnel near one of the line’s busiest stations that killed one worker and seriously injured two others.

The House Republican shutdown has put workers at risk, too.

At the Occupational Safety and Health Administration, where 90% of its inspection force has been locked out, routine and targeted inspections have ground to a halt along with most workplace injury and fatality investigations. Safety experts warn that construction workers could be at the biggest risk, but workers in other high hazard industries such as chemical and steel could also see dangers increase.

After furloughing 1,400 employees, the Mine Safety and Health Administration has been reduced to conducting only targeted inspections at high hazard mines. The agency has been forced to forgo the required quarterly complete inspection of every underground mine. Last week, three coal miners were killed on the job in separate incidents on consecutive days. It was the first time since 2002 there were coal mine fatalities three days in a row.

While the deaths occurred at nonunion mines, Mine Workers (UMWA) President Cecil Roberts said that because of the shutdown, “The government’s watchdog isn’t watching.”

The circumstances surrounding each of these fatalities are different, and I do not want to draw immediate conclusions as to their causes based on incomplete evidence at this time. But it is extremely troubling that within a week after the federal government shutdown caused the normal system of mine safety inspection and enforcement to come to a halt, three miners are dead.

With lack of the regular and required inspections, he said, “Safety violations that would normally be caught and corrected as a result of those inspections are being missed.”

Even the smallest violations, when allowed to accumulate, can lead to dangerous conditions very quickly in a coal mine.

We all have to eat, but the U.S. Food and Drug Administration, charged with inspecting the nation’s food supply, has furloughed 60% percent of its 1,600 investigators and says it’s halted “routine domestic or international inspections of food facilities.”

The Christian Science Monitor reports:

91% of seafood that Americans consume, which the United States imports, is not being inspected, currently. The same goes for the nearly 50% of fruits and 20% of vegetables consumed in the U.S. but imported from abroad.

Bon appétit!

Photo by beltz6 on Flickr

Reposted from AFL-CIO NOW

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IAFF First Responders on Scene in Texas Fertilizer Blast

Reposted from AFL-CIO NOW

Members of Fire Fighters (IAFF) locals are part of the emergency response team on the scene in West, Texas, following last night’s massive explosion at a fertilizer plant that killed as many as 15 people, injured 160 and left many missing, including a member of Dallas IAFF Local 58, who lives in West. IAFF sends us this report.

Hazmat teams from IAFF Local 478 in Waco, Texas, and IAFF Local 2505 in Killeen, Texas, and other emergency service personnel are responding to the scene of the fertilizer plant explosion in West, Texas, which has killed as many as 15 people, including several firefighters, according to reports.

IAFF 11th District Vice President Sandy McGhee is in contact with Local 478, the IAFF affiliate closest to the blast. He says, “Local 478 President Steve Tull reports that none of our members have been hurt as a result of the explosion, although their homes may be damaged.”

However, Local 58 reports that 30-year Capt. Kenny Harris, who lives in West, is missing. The IAFF and its affiliates continue to contact members in the area of the blast in hopes of accounting for all.

Hazmat teams have been dispatched, and firefighters are assessing conditions and addressing safety concerns.

IAFF President Harold Schaitberger says:

Our members are doing what they do best and are on scene making calm out of chaos by assisting their neighboring community. This is another situation where this country is counting on our first responders to be there, and our members never disappoint—they respond no matter the circumstances.

“The severity of the damage remains unclear,” says Texas State Association of Fire Fighters President Guy Turner. “We won’t have a clear picture until the entire scene has been swept by emergency personnel.”

The explosion occurred around 8:00 p.m. on April 17, leveling a four-block area around the West Fertilizer Company. U.S. intelligence officials say that, so far, there is no indication that this was a terrorist event. However, nothing will be ruled out until the investigation is complete.

Dozens of homes are damaged or destroyed, some belonging to IAFF members.

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