Nobel-Prize winning economist Paul Krugman has an important article in the New York Times. Krugman reflects on a major investigative series in the newspaper about privatized prisons in New Jersey, run by for-profit corporations..

The prisons described in the articles are akin to “hell on earth — an understaffed, poorly run system, with a demoralized work force...”

Krugman says we should read the story in the “broader context of a nationwide drive on the part of America’s right to privatize government functions, very much including the operation of prisons.”

Aside from making money, you might think that the motivation for privatization is the conservatives’ “belief in the magic of the marketplace, in the superiority of free-market competition over government planning. And that’s certainly the way right-wing politicians like to frame the issue.”

But Krugman points out that “…the one thing the companies that make up the prison-industrial complex — companies like Community Education or the private-prison giant Corrections Corporation of America — are definitely not doing is competing in a free market. They are, instead, living off government contracts. There isn’t any market here, and there is, therefore, no reason to expect any magical gains in efficiency.”

Why so much privatization? Krugman points to the skillful way in which private corporations have lobbied, made campaign contributions, and established cozy relationships with elected officials.
Krugman warns of  “a corrupt nexus of privatization and patronage that is undermining government across much of our nation.”
Public schools have experienced occasional scandals–a corrupt official or a wayward teacher– but as more and more government funding is out-sourced to deregulated private vendors, especially the for-profit vendors of educational services, hold on to your hats.
Diane