Private immigration facilities likely would expand under a Trump proposal for mandatory minimum terms for people re-entering the U.S. illegally. One private company’s stock showed the highest gain on the New York Stock Exchange the day after Trump won.
Stock prices for the GEO Group and Corrections Corporation of America have surged since Trump’s election. Months after the federal government announced it was ending its use of private prisons, the president-elect’s law-and-order promises have given a new sheen to the financial viability of for-profit incarceration.
Analysts predict Trump will reverse Justice Department decision to phase out private prison contracts and will need more private facilities to handle the impact of his immigration policies. That would be a boon for the Corrections Corporation of America and GEO Group.
Private prison firm, once known as Corrections Corporation of America, becoming more of a real estate management firm than a corrections services company. Its stock price fell after U.S. Justice Department said it would phase out private prison contracts.
The Corrections Corporation of America’s contract to run the nation’s largest family detention center is lengthened for five years despite increasing criticism of private prisons. The Justice Department’s decision to phase them out doesn’t apply to Department of Homeland Security, which also is reviewing the issue.
Several House Republicans write the Justice Department on the industry’s behalf protesting move to end their contracts. Rep. Jason Chaffetz (R-UT) and others contend the move would “undermine the effectiveness of … rehabilitation programs.”
State dropped private facilities three years ago after female inmates were being abused at one of them, but corrections facilities are crowded because of a 13 percent rise in inmates since 2013. State Rep. Brent Yonts warns officials to be careful returning to private operators, but says “we have to relieve … pressure” on local jails.
Mississippi private prison closure could be the beginning of a trend. Credit ratings for private facilities are being downgraded. Small reduction in national prisoner total has some private facilities competing against each other, says analyst Matt Fabian.