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Comment by Delmania | Hacker News Reader

> Can we now, please, get that behind us and move on?

What, and disrupt the massively profitable prison industry?

It is but a tiny shadow of the profitability of the drug industry. Legalised, the wealthy can own it and funnel money to themselves, and Uncle Sam can have a nice big bite. Here comes the money.

Legalized, this industry will collapse, as drugs would be very cheap. The real production costs of most drugs are minuscule. Their high market prices are entirely due to their illegality.

Yes, of course, just as the alcohol industry did. Nobody makes any money selling alcohol.

Well... to be pedantic, the alcohol isn't what you're paying for in most cases - it's the image, the lifestyle, the story.

Would we see the same phenomenon with generic diacetylmorphine and artisinal heroin? That would certainly be amusing...

I can see it happenning for weed though.

Are you subject to the misapprehension that production cost is the primary factor in pricing?

Production cost is a primary factor in pricing in industries having the characteristic of "perfect competition". For example, in the farming industry, the price of wheat is primarily determined by production cost, while influenced by other factors. You can read about characteristics associated with perfect competition on Wikipedia:

https://en.wikipedia.org/wiki/Perfect_competition#Basic_stru...

If drug use and drug-making were both made fully legal, or comparable legal as alcohol-making and alcohol-using, then the industry would rapidly approach perfect competition for certain classes of categories (e.g., pharmaceutical recreational drugs).

Alcohol is a terrible example here. Many premium products already exist in the marketplace with no clear connection between production cost and price. You could possibly build a case with tobacco but you'd have to ignore the cigar market, which similarly has a large premium market segment.

It seems unlikely that other recreational drugs would be different.

Wheat is not a good comparison because it's mostly not consumer facing. Consumers care for more things in their purchases than just the raw good. Your alcohol example IS a good example. Consumers aren't just buying a beverage that intoxicates them that doesn't taste terrible. They pay a premium for brand, image, and to a large extent placebo quality. The cost of manufacturing for most alcoholic beverages has little to do with the final price.

Hell, even look at legal, non-recreational drugs. There can be an identical generic version. There can be an accredited medical professional standing right there saying "they're the same thing" and people will still opt for name brand.

I'm certain that if drugs were legalised, all that extra cost from being illegal would go straight in to marketing budgets and people will be buying the lsd equivalent of $300 bottles of wine or vodka that comes in creative packaging.

Er... did you just say "people don't buy based primarily on price"? Because that contradicts pretty much everybody else...

(Yes, brands have an influence, people buy Vertu phones, but Walmart has a lot more customers.)

Just reviewed my message and no, I don't believe I did. Do let me know if I missed it though!

No, he and you and I and everyone else knows that all things being equal, price determines purchasing decisions. He just also went on to list how in many ways, all things are not held equal.

Illegal drugs are even cheaper and many will choose them because of the potential for employer discrimination.

Why do I think this? I have many friends in Colorado. No weed dealer there was upset at having more production available.

Is that really a big factor compared to police departments?

The largest private for-profit prison (CCA) has $1.7 billion in revenue. Apple makes $233 billion in revenue. Exxon has $268 billion in revenue. Walmart makes $482 billion in revenue.

So it makes as much money as Uber instead of Walmart? Just because it's not the biggest doesn't mean it's not big.

Uber is a a high-growth startup as you may be aware, and will far eclipse its 2015 revenue this year. Even so, comparing the revenues of the "massively profitable" prison company that's been around since 1983 with a single Silicon Valley startup that just got off the ground a few years ago is quite a stretch and a false equivalence.

....And burger king exists since 1953 and "only" makes $1.06B of revenue per year, so what?

3 billion dollars is more than many small countries make in an entire year (nominal GDP)

https://www.opensecrets.org/lobby/clientsum.php?id=D00002194...

https://www.opensecrets.org/orgs/summary.php?id=D000021754&c...

Their revenue is less than 1% of Apple's, but their lobbying budget is 25%-75% of Apple's year to year.

CCA spent $1 million per year. Apple spent $1.24 million in lobbying in three months. Facebook spent $2.44 million in three months. Microsoft spent $11 million on lobbying per year. Google spent $19 million on lobbying per year.

http://appleinsider.com/articles/15/04/22/apples-lobbying-co...

https://www.opensecrets.org/lobby/clientsum.php?id=D00000011...

CCA spent over $3 million in both 2004 and 2005, they've leveled off at $1million for the past 7 years or so.

Also, that's pretty much what I said, isn't it? Apple is about $4 million/year and CCA is at about $1 million/year? Are you quibbling about 20 vs 25%, or trying to make some other point?

Those statistics are really interesting. And that's compounded by the fact that investors don't really care about the total value of a company. They're concerned about the growth potential of companies like Apple while the private prison industry is showing impressive and reliable growth. This creates a powerful incentive to bolster the industry.

There's something obscene about people's retirement funds depending on putting more people in private prisons. It further reinforces the division of society where the happiness of the rich is directly dependent on increasing other people's misery. It's not surprising that the industry has been caught on a few occasions bribing judges to increase sentencing.

Could a fine for private prisons every time an ex-offender is convicted help to rebalance their priorities?

Are prisoners put to tender like school meals are [in the UK]?

But aren't their lobbying expenses more akin to sales expenses since the government is their customer?

The industry made 3.3 billion, of which the vast majority is controlled by 2 groups. That's enough to form a lobby.

Look at how much money CCA spends on lobbying and supporting candidates that are friendly to their business. It is vastly larger per dollar of revenue than Apple (or Walmart). So much so, that it's one of the things people talk about when taking about whether Hillary Clinton (for example) is influenced by the money coming from the prison industrial complex. Nobody is accusing Hillary of being bought by Apple. Though there are concerns about Walmart, due to Hillary's long history with that company, but not because of exorbitant expenditures on lobbying and legalized bribery.

One (of many) articles about how CCA spends money to get the results that suit its bottom line. http://thinkprogress.org/justice/2011/06/23/251363/cca-geogr...

It's downright evil, frankly.

Teachers unions spent $20 million on the 2012 election alone, no doubt funding candidates who were friendly to their pensions. I can go down the line and list off several more trade unions and their political spending.

http://www.opensecrets.org/industries/indus.php?ind=l1300

Why is there seemingly not a peep about this from those who oppose the private prison complex?

Be fair: teachers unions often get talked in very negative terms on HN.

I'm curious: Do you believe teachers asking for more funding is ethically comparable to prisons demanding more prisoners?

I think it hinges on whether the private prison industry is lobbying for more funding per prisoner or tougher laws that result in more prisoners (or longer sentences). If they argue for safer prisons, better rehabilitation programs, more security for guards -- the public should be skeptical but open. If they want to just lock more people up and then bill the government -- that would be somehow like teachers' unions lobbying for less birth control to influence the birth rate and therefore create more demand for teaching jobs. It seems perverse.

In other words, we need prisons just like we need schools, even if people like schools more we shouldn't vilify corrections officers just because they work in an industry we don't care to interact with. It's all about their conduct, which has been terrible. Teachers unions are also self-serving, but they at least pretend to have the child's interest at heart.

Perhaps he's more pointing out the hypocrisy of attaching a scale/range of ethical values to something he determines to be an unethical act entirely, regardless of the ethical value of the reasons behind it.

Most people have more ethical qualms about profiting off of incarceration than about possibly paying too much money to people who educate our children. This is not surprising.

But where do government run prisons get their food, clothes, guard outfits, toilets, toiletries, etc?

Is it really accurate to exclude all of those from the calculation?

So do you think Apple and Exxon will lobby for marijuana and heroin legalization? Because CCA certainly will against it.

Apple, Exxon and Walmart add value.

How is this not a red-herring? Does "massively profitable" mean the same as "the most profitable"?

OP's point is that there is allot of money on the line and that serves as inertia to keep the highly punitive measures in place. $1.7 billion is allot of inertia. It might not be as much as Exxon who wants to deny global warming, or Walmart who wants more "free trade" but are we to ignore mass incarceration because there are more profitable moral hazards?

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