Early this month, three convicted murderers escaped from a prison in Kingman, a small town along Route 66 in northwest Arizona. According to reports, the inmates had broken free from the facility by using a pair of wire cutters. They’d escaped from a medium-security facility operated by Utah-based Management & Training Corp, a private corrections company.
The incident set off a political furor, not over the fact that the three violent criminals were being held in a medium-security prison, but over the security of the facility itself, and, ultimately, over Arizona’s widespread use of private correctional facilities.
Arizona’s attorney general, Terry Goddard, a Democrat running for governor against incumbent Republican Janice Brewer, took the opportunity to indict the state’s infatuation with privatization.
"I believe a big part of our problem is that the very violent inmates, like the three that escaped, ended up getting reclassified [as a lower risk] quickly and sent to private prisons that were just not up to the job," Goddard told a local TV news station.
In recent years, the trend toward privatization, both among state governments and at the federal level has been part of an attempt to address serious budget troubles and crisis-level prison overcrowding by outsourcing more and more corrections operations to private companies.
The move has translated into big business for industry leaders like Corrections Corporation of America (CXW), The Geo Group (GEO) and Cornell Companies, Inc. (CRN) (just last week, The Geo Group and Cornell finalized a merger valued at $730 million).
According to research firm IBISWorld USA, private corrections is a $22.7 billion industry with an annual growth rate in the last half-decade of 4.7%. While growth slowed from 2009 to 2010, projections for the industry remain largely optimistic.
"The prison population continues to grow regardless of what the economic conditions are," says George Van Horn, senior analyst at IBISWorld.
According to the Bureau of Justice Statistics, the number of federal inmates housed in private facilities jumped nearly 14% between 2000 and 2007, and nearly 6% between 2007 and 2008.
Of course, there are ways government can deal with this problem. Make an…
Tonight, with much fanfare, Schwarzenegger released his proposal to fix California’s $19 billion budget deficit. It was a huge disappointment.
Schwarzenegger had a golden opportunity to propose radical changes like privatizing the prison system, privatizing work in general, sending illegal aliens home, or getting rid of defined benefit plans. Instead, Schwarzenegger wimped out on many key issues.
$3.3 billion in other measures, primarily through borrowing from other state funds.
Spending Cuts Breakdown
$1.1 billion through the elimination of CalWORKS, the state’s primary welfare program, which serves 1.4 million people, two-thirds of them children.
$750 million in unspecified cuts to the state’s in-home supportive services program for the disabled, achieved through reductions in wages and services.
Cuts $532 million from Medi-Cal, the state’s medical program for the poor, by reducing eligibility, limiting doctor’s visits to 10 per year, reducing funding for hearing aids and other medical equipment, and increasing copays.
$811 million reduction in prison health care expenses by making the system more efficient and reducing funding.
About $360 million in savings by shifting nonviolent offenders out of state prisons and into county jails and by reducing the juvenile prison population and closing the facilities that house them.
Payroll reductions of 5 percent across all state departments, except for constitutional offices, which already achieved 5 percent reductions. The administration says much of the payroll reduction can be achieved by departments not filling current vacancies.
A 5 percent pay cut for all state workers and a 5 percent increase in their pension contributions. The administration says this will save $1.6 billion.
Proposing a budget that would eliminate the state’s welfare-to-work program and most child care for the poor, Gov. Arnold Schwarzenegger on Friday outlined a stark vision of a California that would sharply limit aid to some of its poorest and neediest citizens.
His $83.4-billion plan would also freeze funding for local schools, further cut state
“The American oligarchy spares no pains in promoting the belief that it does not exist,
but the success of its disappearing act depends on equally strenuous efforts
on the part of an American public anxious to believe in egalitarian fictions
and unwilling to see what is hidden in plain sight.”
– Michael Lind, To Have and to Have Not
It’s time for 99% of Americans to mobilize and aggressively move on common sense political reforms.
Yes, of course, we all have very strong differences of opinion on many issues. However, like our Founding Fathers before us, we must put aside our differences and unite to fight a common enemy.
Remember when the low oil price was an "over-supply" issue and nothing at all to do with the other side of the same coin - dwindling demand? Well it appears that reality is dawning that a record glut combined with tumbling global growth (confirmed by weakness in China PMI, US PMI, and now EU growth expectations) is sending crude prices lower, back to a $43 handle for the June contract...
Over the past 12-15 months, the majority of global stock markets have been in a down trend, creating a series of lower highs and lower lows. The German Stock market peaked around 6-weeks ahead of the S&P 500 last year and could be considered a global trend leader, creating a domino effect.
Below updates the pattern in the DAX index-
CLICK ON CHART TO ENLARGE
The DAX index remains inside of long-term rising channel (A), no doubt ...
Mittleman Investment Management, LLC’s composite gained 9.4% net of fees in the first quarter of 2016, versus an advance of 1.4% in the S&P 500 Total Return Index and a 1.5% decline in the Russell 2000 Total Return Index.Longer-term results for our composite through 3/31/16 are presented below:
The three biggest contributors to our Q1 2016 performance were Revlon (REV): $27.84 to $36.41 (+30.8%),Carmike Cinemas (CKEC): $22.94 to $30.04 (+31%), and Sberbank of Russia (SBRCY): $5.79 to $6.94 (+19.9%).
The three most impactful detractors from our Q1 2016 performance were Pacific Exploration & Production (PRE CN): $1.24 to $0.55 (average sale price at which we exited position) (-56%...
With the exception of emerging market countries in trouble like Brazil and Russia, and complete hyperinflation basket cases like Venezuela, can anyone name a central bank that genuinely wants a stronger currency?
Today, the Bank of Japan is at the top of the whiner list of strong currency complainers, despite the obvious mathematics.
Speaking to reporters in Frankfurt Monday, Kuroda also reiterated that BOJ policy makers won’t hesitate to expand monetary stimulus in order to achieve their 2 percent inflation target. The central bank’s board lef...
Monday enjoyed some follow through upside after Friday's afternoon recovery. However, gains were on very light volume given the distribution which carried most of last week. Also, market breadth remains in decline from overbought levels.
The Nasdaq frames this neatly. The rally has come off a bull defense of the 50-day MA on higher after a series of heavy volume selling days. MACD, On-Balance-Volume and +DI/-DI are in well established 'sell' triggers along with a sharp relative underperformance against the S&P. Bullish dip buyers will be pleased with today's action, but other factors are running against them.
Earlier today we reported that in what many are convinced is just another self-gratifying publicity stunt, Australian entrepreneur Craig Wright "outed" himself as bitcoin's mysterious creator "Satoshi Nakamoto" by unleashing a major PR campaign and revealing his "identity" to three media organizations - the BBC, the Economist and GQ.
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Remember this? It was Monday. PRGO is down from around $130 to under $100 since I started following it LAST WEEK. That's down almost 25% in a week, and almost 50% in the last year. So I wrote,
"Perrigo CEO Joseph Papa leaves Perrigo (PRGO) to lead Valeant (VRX) while PRGO issues a warning about missing earnings expectations. Not surprisingly, PRGO stock plummeted today.
Robert Ingram, Chairman of the [Valeant] Board, stated, "The Board has conducted a thorough search process and believes that Joe is the ideal leader for Valeant at this time. He has a strong shareholder orientation,...
Although we try to stay focused on finding and managing promising trade ideas, the comments in the comment section sometimes take a political turn (for access, try PSW — click here!). So today, Jean Luc writes,
The GOP debate last night was just unreal – are these people running to be president of the US or to lead a college fraternity! Comparing tool size? The only guy that looks semi-sane is Kasich. The other guys are just like 3 jackals right now.
And something else – if Trump is the candidate, that little Romney speech yesterday is probably already being made into a commercial. And all these little snippets from the debate will also make some nice ads! If you are a conservative, you have to be scared now.
Phil writes back,
I was expecting them to start throwing poop at each other &n...
This is a non-trading topic, but I wanted to post it during trading hours so as many eyes can see it as possible. Feel free to contact me directly at email@example.com with any questions.
Last fall there was some discussion on the PSW board regarding setting up a YouCaring donation page for a PSW member, Shadowfax. Since then, we have been looking into ways to help get him additional medical services and to pay down his medical debts. After following those leads, we are ready to move ahead with the YouCaring site. (Link is posted below.) Any help you can give will be greatly appreciated; not only to help aid in his medical bill debt, but to also show what a great community this group is.
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