These days, some policy makers are discussing rolling back America’s system of mass incarceration. Figures from Eric Holder to Rand Paul are proposing eliminating many mandatory minimum sentences. States like Colorado are legalizing marijuana. But while some policy makers talk about shrinking the prison state, prison expansion continues to be pushed and passed by legislators.
On the federal level, the Bureau of Prisons recently allocated $54 million to open the Thomson Correctional Center, a maximum security prison in Illinois. Democrats like Senator Dick Durbin and Illinois Rep. Cheri Bustos have praised the funding, which redirects resources away from production for human needs and towards punishment and state violence. They praise it essentially as a stimulus package. Durbin said, “This is the news we’ve been waiting for. The funding that the Bureau of Prisons reported to Congress today is a significant investment in the economic future of Northern Illinois.” Similarly, Bustos said “This investment by the Bureau of Prisons in Thomson prison means that construction can soon begin, workers can soon compete for good-paying jobs and Northern Illinois will no longer be home to an empty prison.” According to Bustos’ press release, the prison is “expected to provide a major boost to the local economy and create more than 1,100 jobs. Annual operation of the facility is expected to generate more than $122 million in operating expenditures (including salaries), $19 million in labor income, and $61 million in local business sales.”
This tells us a lot about the economics of mass incarceration, but not in the way Bustos and Durbin might want us to think. These Democrats are entranced by Bastiat’s famous “broken window fallacy.” They ignore the opportunity costs of incarceration, from the redirection of resources away from peaceful production of goods and services to the caging of people who could make valuable contributions to communities if they were free. Moreover, this use of public prisons as make-work programs reveals that the perverse incentives at work in prisons operated by profiteers like the Corrections Corporation of America or the Management and Training Corporation also play out in the operation of public prisons. While the opportunity costs and tax costs are dispersed across the general population, and the human costs are concentrated upon people who are systematically disenfranchised, the benefits of prisons are given to concentrated interest groups like prison guards. Thus, public choice theory suggests that those who benefit have more incentive and ability to influence policy than those who bear the costs, so we see a rise in incarceration, regardless of whether it’s good policy for the general public. The perverse incentives are easy to illustrate when ruthless corporate profiteers are the beneficiaries and rent seekers, but local populations that want jobs as prison guards have the same types of incentive problems. This is why we need to push not just against for-profit prisons, but against all prisons. The economic logic of state financed prisons encourages a growing prison state.