Predatory Privatization

Education reformers would have you believe the best way to improve the American public education is to privatize it.  Senator Al Melvin, candidate for Arizona Governor, thinks the solution is to give parents $9K for each of their children so they can choose where to send their child.  Never mind that there are over $1 million students in Arizona and the cost to implement this “voucher” system would be more than the entire state budget.

Nonetheless, let’s explore this idea that privatization is the best solution to provide services for the common good.  In Arizona, we turn to the business of incarcerating people, as this state is one of the leader’s in privatizing prisons.  In early 2012, the Arizona chapter of the American Friends Service Committee (AFSC) issued a report on the impact of private prisons in the state.  The report was called “Private Prisons: the Public’s Problem” and it concluded that between 2008 and 2010, Arizona overpaid for private prison services by about
$10 million, and the services it received were sub-par: malfunctioning alarm systems, fences with holes in them, staff who didn’t follow basic procedures and more.  In fact, the state’s auditor general found 157 serious security failings across five prisons that hold in-state prisoners.  At least 28 riots were also noted.[i]

How did we get here?  In 2012, Corrections Corporation of America (the largest for-profit private prison company in the country) sent a letter to 48 state governors offering to buy their public prisons in return for 20-year contracts.  These contracts would include a 90 percent occupancy rate guarantee for the entire term.  In Arizona, three for-profit prison contracts secured a staggering 100% quota, despite an analysis from 2012 by the Tucson Citizen that showed the company’s per-day charge for each prisoner increased an average of 13.9% over the life of the contracts.  In 1997, Arizona’s spent $409 million on prisons; the per-year cost is more than $1 billion today.  The state now has over 600 current contracts for incarceration related functions, but in fact, cost-effectiveness claims of private prisons just aren’t true.[ii]  According to both AFSC and the non-profit privatization resource center, In the Public Interest:  “in states across the country, private prisons have been plagued with a multitude of problems – major riots have exploded, inmates have died, and civil rights have been routinely violated. Private prisons have an economic motive to cut costs in every area of operations, resulting in lower-quality staff, higher employee turnover, and degrading prison conditions. These dismal conditions directly contribute to the decreased security and higher incidence of violence found at privatized prisons. As prison quality greatly suffers, there is little evidence that these private prisons save governments money.”

Surely this drove Arizona legislators to rethink their position on privatizing prisons, right?  Nope, instead of trying to right the ship, they just turned it into a submarine passing HB2860 which, in the words of AFSC, would “ensure that the public would have no way of knowing whether the state’s private prisons are saving money, rehabilitating prisoners, or ensuring public safety.”[iii]  Why would this be the case you ask?  Let’s just follow the money. Private prison companies like GEO Group and Corrections Corporation of America have made huge contributions to legislators from both major parties, but most of the funds have gone to Republicans.  These corporations have also played a very direct role in designing legislation good for business (such as SB 1070, the state’s notorious immigration bill, passed in 2010).   Florida on the other hand, made exactly the opposite choice with a bi-partisan bill to defeat a plan to privatize the state’s prisons.  The legislators who opposed the bill “argued that public education, like public safety, is a core mission of government that shouldn’t be outsourced to private vendors.”[iv]

As with the prison industry example, the incentives motivating those seeking privatization appear to be immune to the failures of vouchers to deliver on the promise of improved educational outcomes.[v]  The Arizona State Legislature has been working toward privatization of our public schools in a multitude of ways.  Tax credits for private schools and student tuition organizations wash money from public schools into private ones, often for students whose parents didn’t need the help to send their child to those schools.  Empowerment Scholarship Accounts (ESA) give parents 90% of what the state would have spent on their child with a wide range of how they can spend it, even to send their child to a private school.  Then there was also the pillaging of the public education budget that made Arizona the state with the highest per-pupil cuts to education from 2008 to 2012.  Court mandated funding of the owed inflation funding from Prop 301 has helped raise us to third highest in the nation now, but that still is a poor ranking.   Of course, it is important to understand that many of these voucher work-around programs get started as providing opportunity to students from poor families, children with disabilities or students in underperforming schools as with Arizona’s ESAs.  This however, is not the ultimate goal of the privatizers.  They are instead, a tactical means to a much larger strategic end of ending public education.[vi]

To what end you ask?  Again, follow the money.  Organizations like ALEC are promoting school choice and privatization, providing our legislators “camera ready” bills to implement across the country.  In addition, Right-wing organizations and donors laud Arizona as a leader in the school choice movement and are funneling big money into the state.

What is really ironic about this whole privatization movement is that the GOP has painted them self into this corner.  Their anti-government fanaticism, combined with tough stances on crime, immigration, etc., combined with a refusal to raise taxes, forces them to tout the benefits of privatization.  Unfortunately, the companies whom the services are farmed out to are interested much more in a desire to generate revenue than in any social obligation.  Think Halliburton and Backwater during the wars in Iraq and Afghanistan.

The bottom line is that business is in business to make money.  There is nothing wrong with that as long as the product or service they provide is not something that must be provided to everyone regardless of their ability to pay.  Every state constitution in the nation mandates the state provide a free public education – it was a requirement for their entry into the Union.  But, when public services have been outsourced to “for-profit” companies, it is very likely the contract will increase in cost over time, limit transparency, undermine good public policy and the democratic process, and that the drive to generate revenue over providing for the public good will eventually be more costly to the taxpayers.[vii]  The examples abound.  We should pay attention.  Public schools are not only our right as Americans, but they helped make us a great nation and, are important still very important to the health of our communities today.

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One thought on “Predatory Privatization

  1. Right On! ALEC offers cut and paste legislation for Legislators along with campaign funds. Trips, vacations…I mean conferences. Vouchers a nice way of diverting needed funds from locally elected school boards to privately run institutions.

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