Monday, August 8, 2011

Inside Job: Private industry in beginning to realize there is plenty of cheap labor in the U.S.--prison labor

This article was originally published Dec. 13, 1995 in Moon Magazine, a Gainesville, Fla. newsmonthly.

Three prisoners in white scrubs and masks spray rows of dangling green loofahs with a pesticide. Twenty rows away, three inmates in prison blues inspect the struggling sprouts, making sure crows haven't pecked away their labor.

The future of prisons may be growing on these ten acres of mucky soil 35 miles north of the Florida Everglades.

The Hendy Correctional Institute near Immokalee is a sprawling 3,850 acre compound whose razor wire-enclosed landscape includes orange groves and cattle range, a catfish pond and tanks, a station for the work camp and the main prison building. The state started a program here in August that employs a few low-risk inmates to grow loofahs, the mammoth cousin of the cucumber that can be eaten if picked young enough or used a scrubber when dried and bleached.

"This is not the menial task usually associated with prisons," Clarence White, Hendry's assistant supervisor of operations, said. It is hard work, though. Inmates work six hours a day, five days a week, inspecting budding plants, making sure the vegetables have room to grow along a wire, trying to keep water from rotting the plants off the vine and spraying pesticides. Of 1,300 inmates at Hendry, only a dozen or so work on the farm.


Florida hasn't offered the fruits of prison labor to private enterprise since the bad old days of turpentine camps and railroad crews at the turn of the century. The loofah farm is part of a 16-year-old national trend--allowed by federal legislation--where private, profit-driven companies may contract inmate labor or buy prison-made goods to sell on the open market.

Menial tasks such as cleaning floors and doing laundry are still the staple prison jobs, and manufacturing products such as furniture and uniforms for state and local governments is still the traditional prison industry. Prison officials say these jobs help teach prisoners the work ethic and often prepare them for jobs when they leave prison. State and federal studies have shown that recidivism, the rate a freed prisoner commits another crime and goes back to jail, is reduced when inmates work.

But traditional work environments are not enough, some prison experts say. A 1988 U.S. Department of Justice study, "Work in American Prisons: The Private Sector Gets Involved," reported that a "real-world" workplace where prisoners made goods or provided services for the free market was the best work scenario because prisoners would be exposed to the ways businesses are run on the outside. Trained in "real-world" settings, prisoners could leave prison with the skills to get a steady job.

"There is discipline in the profit motive," according to Neal Miller, a principle associate at the Institute for Law and Justice, a Washington, D.C.-based non-profit research group that helps state corrections departments run their prisons and industry programs. "I don't think the profit motive is contrary to rehabilitation. It's necessary."

Examples of current private sector/prison businesses vary:

  • Juvenile offenders at a California reform school operate reservation phone lines for Trans World Airlines. Prisoners in Nebraska are telemarketers for TGS Marketing, a $3.5 million Nebraska hardware firm. And until recently, prisoners took reservations for Best Western motels.
  • Inmates in Tennessee sew jeans for Kmart. Oregon inmates make uniforms for McDonalds. Inmates in Nevada build limousines.
  • Prisoners in Chicago were hired by Toys R Us to stock shelves, but were stopped by union protests.
  • Inmates in Tennessee made wooden rocking horses for Eddie Bauer.
  • And Prison Blues jeans, "made on the inside to be worn on the outside," are the modern prison industry success story. Prisoners in Oregon are paid from 28 cents to 8 dollars an hour to sew jeans that cost about $20 locally to $80 in Europe, where they are considered hot property.
Though they number only a few small- to medium-sized companies, private employers have been working in prisons or buying prison-made goods for awhile. A 1979 federal law allowed state prisons to start "prison industry enhancement," or PIE, programs that couple private industry and prison labor. Products made in the PIE program--including Florida's loofahs--can be shipped across state lines, relaxing one prohibition that has long prevented private employers from using prison labor.

Another major reason private businesses haven't used prison labor more often is the Fair Labor Standards Act of 1938, a product of the union activism and political pressure that established much of our present labor law. The FLSA requires works in the free market to be paid the minimum wage and be give resources to courts when they feel wronged by employers. Prisoners are not explicitly excluded from the FLSA, and federal PIC legislation requires inmates be paid the minimum or prevailing wage.

A bill to exclude prison inmates from federal minimum wage and benefits laws has been floating around Congress since the 80s.

"Implications for the Fair Labor Standards Act for Inmates, Correctional Institutions, Private Industry, and Labor," has been defeated several times, but keeps resurfacing, each time sponsored by a different senator or representative. The bill, if passed, would open the door to more private industry involvement in prisons.

Florida Rep. Bill McCollum co-sponsored this bill. In May 1994, he addressed the House Committee on Labor and Human Resources:

"We need to find...a formula that would allow us to bring private industry into the prisons more often and be able to sell prison-made goods across state lines in terms of the general open market rather than simply the confined areas today where those prison-made goods are allowed to be sold to other government agencies."


Captive Market


It's no surprise profit-driven companies are looking to prisons as a potential labor pool. American factories have been moving overseas and Mexico for years in search of cheaper labor. Proponents of private-sector involvement say prisons could provide products currently made by cheap labor in under-developed countries.

Prisons, they say, are a vast untapped resource. U.S. prisons house nearly a million people, many of whom lack job skills. Problems with training and discipline, private prison industry advocates admit, must be surmounted.

Florida traditionally holds more than its share of prisoners. In 1970, 9,412 criminals were incarcerated in state and federal prisons here. For each 100,000 citizens, 137 were locked up. The national average was 97 prisoners per 100,000.

By 1993, the state housed 53,048 criminals, or 385 prisoners for every 100,000 citizens. The national average was 351 prisoners per 100,000. Since 1990, Florida has added almost 10,000 prisoners. And the state plans to build 8 prisons and four work camps by 2000.

Faced with burgeoning populations and burdened by mandatory sentencing laws, higher costs, reduced revenues, and increased political pressure to make inmates get out of the bunk or away from the television, state prisons are looking more frequently to private industry.

"It's real world training," according to Miller.

Most of the people in prison are young, unskilled men. Most of the work in prison industries requires only a minimum of skills, which contradicts the argument that prison labor teaches convicts finely honed skills. Such arguments are drapery for a more rudimentary economic reality: Companies don't have to look beyond the U.S. for low-cost, unskilled workers.

"The flight of labor-intensive businesses overseas, driven by the search for lower costs, may be partially offset by private-sector prison industries," the Justice Department reported.

The Reagan-era report admitted, however, that this could cause a problem: "Evidence of the creation of a permanent underclass in the U.S., with concomitant decrease in the middle class, will mean more competition for low-skilled jobs."

And critics have picked up on the disparity between the promises of relevant work skills and the irrelevance of much of the labor-intensive work that attracts private industries.

"What are they training prisoners to do?" asks Joe Gunn, president of the Texas AFL-CIO. "Are they training prisoners to get jobs in Taiwan?"

Prisoners making Prison Blues jeans learn sewing skills, even though most textile factories have moved overseas or into cities where cheap labor often illegal aliens are plentiful.

Miller puts the underlying issue bluntly: "If you had a sewing factory in Los Angeles, and hired illegal aliens, you could get away with it for awhile. But if you could do that legally with inmates, that'd be terrific."


Labor's Hedge


Unions and businesses affected by prison labor agree that prisoners need to work. They argue, however, that when companies hire prisoners, they take jobs away from free citizens, exploit a captive worker for profit and drive down wages.

"States chasing the illusionary benefits of convict labor have produced a long and colorful history of unfairness, injustice, and corruption," John Zalusky, the head of the office and wages and industrial standards at the national headquarters of the AFL-CIO, told a Senate committee looking at expanding private prison industries to the federal prison system in 1993.

Zalusky detailed how wicker furniture workshops in an Illinois prison in the early part of the century destroyed the U.S. wicker industry, taking with it the Reed and Rattan Furniture Workers Union. The taxpayers, in effect, paid to undermine the free market.

"It's not just a threat to workers," Gunn said. "It's a threat to communities. I don't want people having to go to jail to get a job."

Gunn's gone up against private prison employers in Texas. Wackenhut, a private prison firm with a facility in Lockhart, Tex., incarcerates criminals for the state. To help the bottom line, they hired inmates out to private employers. Union workers in Austin were displaced when their employer, a circuit board manufacturer, set up shop in the prison.

"Convicts are slave labor owned by the government," Zalusky said recently from his Washington office.

And if you follow American philosopher Thomas Dewey's maxim that government is the "shadow cast on society by big business," then Gunn says the same thing: "Corporations want to make slave labor in America."

Gunn's not off the mark. The 13th Amendment to the Constitution the federal law that officially freed the slaves during the Civil War, specifically exempts prisoners: "Neither slavery nor involuntary servitude, except as a punishment for crime whereof the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction."


Work Shall Set You Free


Prisoners in all states are required to work. Many do menial tasks such as cleaning floors or working in kitchens. Others clean parks and highway rights-of-way. And Florida recently joined Alabama and Arizona by reinstating one of the South's least picturesque postcards: the chain gang.

Hiring or contracting prisoners to private employers is not new. Prisons, often in the interest of private, profit-driven companies, exploited prisoners and drew jobs out of the free market.

The most notorious was the convict-lease system developed in the 19th century. States contracted out prisoners to private companies who exercised complete control over their lives. Prisoners built railroads and highways, toiled in rock quarries, worked huge farms. The American Siberia, published in 1891, details the harsh life of convicts working in turpentine camps and on railroads in North Florida. The convict-lease system was abolished in all states by 1936.

Humanitarians and organized labor helped push through legislation in the 1940s that limited prison industry to manufacturing goods for only government agencies.

Typical "state-use" products include uniforms, furniture, printing, and of course license plates. PRIDE, a Clearwater, Fla.-based non-profit company that has exclusive right to employ Florida's inmates in state-use shops, also grows crops and raises cattle, manufactures medical supplies and chemicals, and builds some government buildings.

Prisons had been operating these state-use workshops for years when population growth nationwide and riots at Attica in New York, McAllister in Oklahoma and Pontiac in Illinois in the 1970s drew political attention to prison policy. The Department of Justice released studies that characterized many prison workshops as sloppy attempts to emulate real-world factory settings.

Prison workshops did little to alleviate idleness, the force most prison experts say is responsible for violence. Former Chief Justice Warren Burger coined the term "factories with fences" in a speech to lawyers in Nebraska in 1981, and set the tenor for today's prison policy.

Most states operate PIE programs or have legislation that allows private firms to hire prisoners. No federal laws prohibit companies from hiring prisoners as service workers usually phone solicitors or reservationists.

PIE stipulates that state prison authorities have to inform unions and businesses that may be affected by the prison business. States are supposed to pay inmates the minimum or prevailing wage whichever is higher from which victim restitution, state and federal taxes and room and board are deducted. What's left the prisoner can save, send home, or use to buy cigarettes or magazines from the prison canteen.

But labor organizers point out that these stipulations are often only partially followed.

"I don't know of one who's done all these things," Zalusky said. In 1984, Arizona prisons leased a meat packing plant in Phoenix, promptly fired 400 members of the United Food and Commercial Workers union, and gave their jobs to 60 convicts. This was a PIE project. The union asked the Department of Justice to revoke Arizona's certification, but no action was taken.

Wooden horses made by Tennessee prisoners could have been made by any number of woodworking plants in the area, according to Sue Perry, executive director of Prison Industries Reform Alliance. The Grand Rapids, Mich.-based PIRA is a coalition of 850 businesses impacted by prison industries, and has diligently studied the growth of inmate labor in the US.

Of the more than 900,000 people incarcerated in the US, 1,200 are employed by or contracted to private employers under PIE legislation. About 68,000 are employed in traditional state-use industries. PIRA estimates that by 2000, 520,000 inmates will be employed in prison industries, both state-use and profit-driven.

"The more we've looked at it, the more we've been shocked by the potential for abuse," she said.

The AFL-CIO, armed with the government's own record-keeping, reported that companies simply want cheap labor and that state governments are usually more interested in getting their money back on prisoners than giving them real-world job skills. The US General Accounting Office reported in 1993 that many state PIE programs pay less than the prevailing local wage.

And several states have illegally contracted prison labor to to private employers. In 1986, New Mexico sold office furniture made by 80 prison inmates at 25 cents to $1.25 an hour to several private companies.

Many of the jobs in PIE programs are similar to Florida's loofah farm: intense on labor, low on pay. "The reason farmers don't want to mess with it is because it's labor intensive and we've got the labor," Hendry's White said.

In this regard, the loofah farm does not technically compete with free labor in the US. Loofas are usually imported from China, a country, ironically, that gets criticized because factories are an integral part of prisons there.

Profiting Without Profit


The loofah sponge farm is tucked into the southeast corner of the compound near a highway where trucks carrying produce zip back and forth.

In August, inmates grew the seedlings in a greenhouse and in September transported them to the fields, where the loofas grow on a guide wire strung across support posts. In January, when the loofahs are about 2 feet long, the inmates will cut them down, peel and dry them, bleach them and cut them to size.

Some sponges will be kept for prison use as scrubbers. Some early plants will be eaten- the loofah is a member of the squash family. Some will be sent to the Walker Cancer Research Institute in Tallahassee where biochemists want to examine properties of the loofah for AIDS and cancer research.

But the bulk of the crop will be sent to a cosmetics firm in Michigan, who have promised to buy all the inmates can produce.

"The inmates are showing more interest," Sgt. Jesse Manzano, the corrections officer who overseas the loofah field, said. "It looks like they're disciplining themselves."

The inmates do not appear excited about their work, but in the lackadaisical, plodding fashion you associate with government work, they get the job done. Manzano would not allow any of the inmates to speak to this reporter.

"By doing their job by hand, physically, sweating in the hot sun, they appreciate what they're doing," Manzano said. "When they're out on the field, they can forget about their troubles" inside the main prison a few miles up the road.

Union organizers and prison officials agree that prisons should teach inmates work skills or at least a work ethic. They diverge, however, on whether private, profit-driven businesses should be involved or whether prisoners should be employed in a job that still exists in the free market.

Instead of competing with free workers, prisoners could be hired to do the kind of work no one wants to touch, according to Sue Perry, executive director of a group of businesses and labor unions who were affected by prison industries.

Perry said prisons could break down televisions and other electronic components, refurbish mattresses or sort recyclables, for example.

"It would be a great paradigm." she said. "It would be good for society and it wouldn't punish taxpayers."

Prison officials, think tank researchers, and union and business advocates are debating the trend as it evolves.

Miller says private involvement will increase if state prison systems can learn to understand the needs of private enterprise.

"From my perspective, the real problem is a lack of capital," he said. "Most companies (doing business with prisons) are small and under-capitalized &the question is how to get large companies and keep them."

Critics see the for-profit prison labor model as an outcome of a vicious cycle: the same broken economy that pushes low-skill jobs into ever-lower markets overseas and into Mexico will naturally find prisons--full of the men and women who have no place in that economy--an even more efficient labor source.

"We need more schools and less prisons," said Mark Neimeiser, the Florida legislative political director for the American Federation of State, County, and Municipal Employees. "It's ironic that we take prisoners and give them work they couldn't get when they were free."

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