The Trump administration’s decision to separate migrant children and their parents at the border and its anemic efforts to reunite families since the reversal of that policy have been widely condemned as cruel. But the president’s so-called solution — to imprison immigrants as families in detention centers — is equally abhorrent.
This policy, which will undoubtedly cause immense human suffering, has one clear beneficiary: the private prison industry.
In recent decades, private prison operators have opened facilities that detain immigrants and their children. This means that many times, when a mother escapes life-threatening dangers in her home country and arrives in the United States only to be imprisoned in one of these facilities, they profit. When a family seeking refuge in this country is put behind bars, they profit. When a new center needs to be opened because law enforcement officers are arresting more immigrants, they profit.
This industry has turned human suffering into a billion-dollar business.
It’s long been known that the conditions in private prisons are dismal. In 2014, the American Civil Liberties Union report “Warehoused and Forgotten” chronicled the conditions faced by immigrants in these institutions. This investigation uncovered evidence that people held in private prisons were denied access to functioning toilets and proper medical care and served inedible food, and had no opportunity to challenge excessive use of solitary confinement.
A 2016 Justice Department report found that there were more safety and security problems in private prisons than in those run by the Federal Bureau of Prisons. This partly explains why the Obama administration began phasing out the use of private prisons — an order Attorney General Jeff Sessions reversed.
They also explain why New York City was proud to be the first city in the country to divest from private prison companies in its pension fund investments.
Pension funds have a fiduciary duty to make sound investments that grow their portfolios and help fund retirement benefits for their members. That means constantly evaluating the long-term viability and risk of investments across the pension funds’ portfolios, which is what the New York City Comptroller’s Office does every day.
Private prisons fail that basic risk assessment. That’s because the industry’s bottom line depends on locking people up. And when you imprison people for money, it means you have to choose between padding the bottom line and spending the money needed to create safe and healthy conditions. Too often, the bottom line wins out. These companies have a financial interest in perpetuating the inhumane “zero tolerance” policies whose consequences we now see on the front page of the news each day. Consequently, as an investment, they’re at the whims of a seesawing political climate. This combined with the moral issues surrounding private prisons has convinced us that they are imprudent for investors to own and for banks to finance.
In May 2017, the boards of all five of New York City’s pension funds passed resolutions requiring divestment, declaring that “investment in for-profit prison companies exposes the system to undue legal and regulatory risks and worker-safety issues that are inconsistent with the board’s risk profile and objectives.”
Others have followed our lead. Philadelphia’s pension board voted last year to divest its holdings in private prisons. City Council members in Cincinnati have pushed for the same. This month, New York State Comptroller Tom DiNapoli sold the state pension funds’ remaining stocks in the private prison industry, making our state the first to fully withdraw from it.
Leaders across the country should recognize that in addition to their human costs, private prison companies are part of an industry that poses major financial risks to cities and states. It’s clearer than ever that we should put our money elsewhere.
Scott M. Stringer is the Comptroller of New York City. Javier H. Valdés is the co-executive director of Make the Road New York.