The private prison industry has taken off in part on the claim that private companies can save governments money by imprisoning people for less. But they’re not doing it by skimping on compensation at the top. Between 2008 and 2012, the CEO of one of the world’s largest private prison firms earned $22 million in compensation, according to Securities and Exchange Commission filings.
A new report from the Center for Media and Democracy dubs GEO Group CEO George Zoley America’s highest paid “corrections officer,” in a ranking of top-earning “government workers” — those in privatized industries.
Zoley, who founded GEO in 1984, oversaw its expansion into a billion-dollar corporation that almost had a college football stadium named after it. Just last year, the firm saw a 56-percent spike in profits, after adopting a strategy for drastically reducing its taxes. That success is also reflected in increasing compensation for Zoley, whose earnings spiked from $2.8 million on 2008 to almost $6 million in 2012. Other top GEO executives also profited handsomely at annual levels of between $1.1 million and $1.5 million.
But GEO and other private firms have little incentive to invest this profit in inmate security and rehabilitation, and have secured this profit on the backs of not just taxpayers, but also the criminal justice system. The firm has become known for inmate abuse, violations and fraudulent reporting, and disregard for the truth. In fact, one GEO executive testified under oath that lying to a federal agency would be just fine.
GEO does have incentive to lobby for steady or increased incarceration. As of 2012, these firms had spent $45 million to lobby for laws that benefit their bottom line over the course of a decade, including increased incarceration. In 2013, filings show GEO Group lobbied Congress on immigration reform, despite pledges by top executives not to. And even as federal and state sentencing reforms move to reduce a U.S. prison population that eclipses that of every other country in the world, private prison firms have secured a reliable flow of inmates thanks to quotas that commit states to fill a certain percentage of prison beds.
During a conference call touting its success in boosting profits, GEO Group executives boasted that the company continues to have “solid occupancy rates in mid to high 90s” and that they are optimistic “regarding the outlook for the industry,” in part due to a “growing offender population.” This is one of several comments by executives at GEO and fellow private prison firm Corrections Corporation of America that associate increased incarceration with positive profit outcomes, and assurances to investors that immigration reform would not reduce the “demand for beds.”
But despite all this evidence of foul play, there is much we don’t know about how these firms operate. A Citizens For Responsibility In Ethics report also released this week finds that private prison firms’ insulation from the transparency laws that govern public prison entities likely means that “only the most egregious instances become public” and prison firms “largely escape liability and accountability.” The report also finds this lack of transparency makes it difficult to know whether private prisons are actually saving the government money, as they purport to do. In several states, evidence suggests that they have actually cost states more.
GEO has invested in not just privatization of prison facilities, but also prison health care and other services. And the burgeoning industry of private probation suggests this trend is only expanding in the criminal justice system. The Center for Media and Democracy report highlights plush executives in several other industries that have found similarly lucrative opportunities, including education and waste management.