Sunday Dec 17

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To understate the obvious: our side in the fight for social and economic justice and full democratic participation by all people isn’t doing well. I would like to use the California budget crisis to ask “Why? Why isn’t there a politically serious, no cuts, improve public services, progressive taxation proposal on the table?”

Easily asked; not as easily answered. The roots of the problem go deep.

The last time there was a serious effort to pass a “no-cuts” tax relief and reform proposal was 1975-1977 when the California Tax Reform Association (CTRA), a Sacramento-based and labor-supported public interest organization, and the Citizens Action League (CAL), a coalition of labor, minority, religious, senior, neighborhood and activist organizations, supported Sen. Nick Petris’ SB 154 – the Tax Justice Act.

It provided substantial property tax relief to 80% of homeowners and to renters (very highly priced homes didn’t do so well), and made up lost revenues by a combination of new upper-income tax brackets, mineral extraction taxes, and closure of corporate loopholes. It was vetoed by Governor Jerry Brown. Then-Assembly Speaker Leo McCarthy and the SB 154 coalition got a veto override vote; Senate leader David Roberti and CTRA-CAL couldn’t in the Senate. Proposition 13 became law the next year.

Jump To Now

Recently, a $26 billion deficit loomed because of the housing crisis-precipitated recession. At the same time, wealth concentration and income inequality were growing by leaps and bounds. An SB 154-type package could have made up the early deficit figure of $26 billion with no cuts in, and, indeed, improvements to, programs.

Conservative Republicans in California wanted to eliminate $26 billion of government services as part of their general destroy government strategy. They continue to play variations on Ronald Reagan’s “Get the government off your back” theme.

Democrats wanted to eliminate $13 billion of government services – the “crippled programs syndrome” approach that leads to inadequate public programs. They wanted to pay for the remaining $13 billion with a mix of regressive and mildly progressive taxes.

Yet, according to surveys of Californians, a majority supports Prop. 13 reform and progressive taxes, and is angry at the increasing concentration of wealth, income and power going on in the state and the country.

And, despite the supposed "anti-tax" climate, many local school and other bond and revenue measures are adopted by the voters, even when they require 2/3 approval.

There's a radical disconnect here? How should we understand it? What should we do about it? Why?

It is easy to blame spineless Democrats. But surveys and elections are two different things. Politicians understand that in the absence of mass-based “popular” organizations, money is required to buy mass media, that without mass media it’s difficult to win elections, and that you get money to buy mass media from people who have lots of it. Small donations aren’t sufficient. While politicians may or may not be spineless, they know what it takes to win elections.

Who were Democrats able to seduce (though it does take two to climb into the bed) in their crackpot realism compromise that cut the most vulnerable? Organized labor, particularly most public employee unions. Until labor is willing to disengage from its hand-in-glove relationship with Democratic politicians, and mount, or participate in, mass-based campaigns to push Democrats from the left, this drift to the right will continue.

Who might initiate the effort to pull labor away from its seductress? In 1976, some private sector unions that participated in the CTRA-CAL coalition wanted to preserve corporate loopholes in their particular sector of the economy. Others in the coalition said, “no deal. Either there’s across-the-board elimination of corporate loopholes, or we’re out.” There are no “Others” now to push labor in this way.

We have to look at a second source of our problem: the displacement of vigorous voluntary sector organizations of low-to-middle income and minority communities by the plague of community-based nonprofits, each of which may operate a program of merit but who collectively constitute a layer of co-opted leadership now dependent on a combination of government and foundation funding, making them competitors with one another for pieces of a shrinking pie.

In CAL days, religious congregations, unions, moderate and militant community groups, and various identity-based organizations came together in creative, sometimes tense, lowest significant common denominator coalitions that could — when they agreed — muster the clout to pass significant legislation and wrest significant concessions from corporate power.

We now face this irony: while individual community organizations are more powerful than they were 1974-78, and while some of them are part of state-wide and national “networks,” the sum is less than the parts. Each of the major networks in California — IAF, PICO, Gamaliel, ACCE (heir to ACORN), as well as important “independents” — can point to victories on specific campaigns. None of them seems to have any idea how, or they lack the will, to create majority coalitions that can slow, halt and reverse growth of the plutocracy. They list often-major victories while the experience of most Californians is that the quality of their lives continues to decline.

“The left,” broadly defined, pursues policies, strategies and tactics that may individually be of merit but whose cumulative impact has been to isolate it from the white working class, significant sectors of the very constituencies for whom it seeks and claims to speak, and middle-class “Anglo” moderates.

With no apparent place to go, the former drop out or support people and organizations ranging from George Wallace to The Tea Party. In the black community, the division between the people who go to church and the people who hang out on the street is far deeper than in the days of multi-class ghettos. Parallel divisions exist among Latinos, elderly, disabled, youth and other groups.

The political result in California is that centrist Democratic governors and legislative leaders made alliances with moderate Republicans to create legislative majorities, boxing progressives in and isolating them — despite majority public support for their economic policies.

Meanwhile, corporate power and individual wealth got off scot-free. It is easy to say they use “divide and conquer” strategies or have limitless money at their disposal. Both are true. But they are givens – the complaints of observers, not those who would make and change history.

What Is To Be Done: Two Steps Backward In Order To Move Forward

A new majority constituency position has to be defined by a group of leaders representing important labor, minority, senior, disabled, student, small business, professional and other significant groups in the state. They have to take this position deeply into the rank-and-file of their respective organizations. In many of these organizations this means getting beyond the usual activist core that speaks for others but fails to engage and involve them. Such a group, program and approach can stake out a moral claim that allows them to speak for the best of our religious and small “d” democratic traditions.

That position has to benefit 70% of Californians in its policy impact, avoiding, for example, the division over tuition increases in state institutions of higher education where middle-class households pay more so children of lower-middle class, working class and low-income households can receive student aid. This position must restore a steeply progressive income tax at high income levels, adopt and increase mineral extraction taxes, close corporate loopholes, and split the property tax between commercial/industrial and residential property and otherwise revise Proposition 13.

A campaign for this policy should be viewed as a three-to-five year effort so that local campaign committees can be built in most state assembly and senate districts, aimed at creating a veto-proof legislature in 2014 or 2016. It should target the legislature so that politicians who support it can be rewarded and opponents can be punished.

The local campaign committees should be non-partisan, but consciously seek to develop visible spokespersons who could be primary challengers against a negative legislator, principally in Democratic Party primaries, but also supporting the few moderate Republicans left, and perhaps in some circumstances supporting a third party candidate. The campaign should be kicked off by massive public rallies or mass meetings held throughout the state so a credible threat can be made to boycott corporations that threaten to move out of California because of the policy’s tax consequences for them.

Underneath the umbrella of the statewide campaign, a door-to-door canvass should be initiated that combines fund-raising, political pressure on legislators and education with a canvass-organizing effort to build new individual- membership, dues-paying, neighborhood and small town level clubs that have a life of their own. The clubs would use political participation, direct action and mutual aid to pursue a multi-issue agenda. They would define a program of public service improvements they want in their districts. The canvass-organizer who was their original organizer would shift to being their organizer whose salary and benefits are paid by their dues and such grass-roots fundraisers as raffles. Imagine a relatively small neighborhood of 10-20,000 with a club of 500 members who pay $100 a year in dues. The club has social, cultural, educational, mutual aid (time dollars, buying clubs, pooled baby-sitting, etc), direct action, lobbying and electoral activities as parts of its community-building activities.

CAL created a unit of experienced canvassers and added an organizing component to their job. While canvassing, they asked people if they would be interested in coming to a house meeting to discuss what they could do to help the campaign. They also assessed responses, and tried to discover who knew whom, and who respected whom on the block. When they thought they had a potential leader, they asked that person to convene the house meeting, and gave her the list of interested people in the immediate neighborhood. Canvassers raised "quota" (the fundraising goal) in three, instead of the usual five, days. In the remaining two days, they organized the house meetings, helping leaders create the agenda, and training them to conduct a small house meeting (a dozen-to-25 people). The level of participation that was generated staggered CAL's canvassers and leadership. The anger was waiting to be tapped. (The only similar energy I've seen since are the responses in the Latino community to immigration rights battles and the responses of public employees and their allies to Wisconsin's Governor Walker. And, unfortunately, the responses to The Tea Party.)

The feasibility of such an effort was demonstrated in the 1975-76 SB 154 campaign. A contemporary version has to take into account vast differences in today’s political climate. That, in turn, requires initial conversations among the group of leaders to whom I earlier referred.

Putting that group together is like stringing individually distinct beads on a necklace: it’s done one at a time as a result of one-to-one conversations initiated by one or two respected people who are willing to step up to see if this can be done. The conversations are framed in an “If…then” manner: “If a dozen-or-so key leaders in California are willing to meet to discuss how to make this campaign happen, would you be willing to be one of them?”

If no critical mass, no forward movement. And if no forward movement, we will continue to move backward.

Mike Miller directs the San Francisco-based ORGANIZE Training Center. He was a founder and chairperson of the Citizens Action League (CAL).

Adapted from a shorter article with the same title that appeared in Beyond Chron: The Voice of the Rest. San Francisco’s Alternative On-line quarterly.

Editor’s Note: In the United States, Mexico, and many other countries collective bargaining, workers’ rights, and unions themselves are under attack in what can sometimes seem a coordinated attack.  One of our readers sent us this piece, and it seemed especially topical for the times, therefore we are “printing” it immediately and offering it to our readers directly as a special feature on-line feature on our website.   WR

Recent events in Wisconsinhave questioned the necessity of collective bargaining.  The governor of Wisconsin notwithstanding, collective bargaining is recognized internationally in numerous conventions, constitutions, and courts as a human right.

Legal Background

Our Constitution addresses the right of collective bargaining.  The Thirteenth Amendment provides that:

Neither slavery nor involuntary servitude, except as a punishment for crime whereof the party shall have been duly convicted, shall exist within the United States, or any place subject to their jurisdiction.

The thirteenth amendment appears to address only the issue of slavery.  However, according to the Supreme Court in 1911, the purpose of the thirteenth amendment was not simply to eliminate slavery, but:

…to make labor free by prohibiting that control by which the personal service of one man is disposed of or coerced for another's benefit.

This argument was advanced by labor leaders in the 1920’s.  They asserted that the rights to organize, strike, and boycott were the logical application of the constitution to the stage ofeconomic development of the time.As the industrial economy developed to a massive scale, the individual employee had no tangible power against the industrial behemoths of the day.

The Norris-LaGuardia Anti-Injunction Act of 1932 was the primary national statute that declared the right of collective bargaining:

Whereas, under prevailing economic conditions, developed with the aid of governmental authority for owners of property to organize in the corporate and other forms of ownership association, the individual unorganized worker is commonly helpless to exercise actual liberty of contract and to protect his freedom of labor, and thereby to obtain acceptable terms and conditions of employment.

Collective bargaining was an integral component of the National Labor Relations Act (NLRA) of 1935 also known as the Wagner Act.  Prior to the law, employers could literally spy upon union members, interrogate, punish, blacklist, and terminatethem without just cause.

The Act clearly asserts the rights of collective bargaining in Section 7:

Employees shall have the right to self-organization; to form, join, or assist labor organizations; to bargain collectively through representatives of their own choosing; and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.

This language was affirmed by Article.23 of the Universal Declaration of Human Rights in 1948 which identified the right to organize trade unions again as a fundamental human right.

Everyone who works has the right to just and favorable remuneration ensuring for himself and his family an existence worthy of human dignity, and supplemented, if necessary, by other means of social protection. Everyone has the right to form and to join trade unions for the protection of his interests.

Corporate Parasites

Corporate power is strangling the natural American impulse of political democracy.  Collective bargaining is an extant mechanism that ensures at least a modicum of fairness for employees.

Corporate billionaires pay swarms of lobbyists to influence legislators.  Union contributions cannot compete with such expenditures. Corporations transfer gobs of cash to legislators as the Koch brothers billionaire club did for the governor of Wisconsin.  They finance reactionary think tanks that churn out staggering amounts of false data on issues affecting middle and low income people.  Individual employees are no simply match for such corporate power and avarice.Unions serve to democratically balance that asymmetrical relationship as a “countervailing power,” as coined by economist John Kenneth Galbraith.

Our history is replete with patterns of employer abuse absent a union with the collective bargaining instrument.  Employees were routinely underpaid, overworked and dismissed unjustly at the caprices of employers.  Employees and their family’s lives were arbitrarily disrupted and sent into financial and personal chaos.  This issue crystallizes our national justification to provide a serious voice for working people and their families who perform the work in our cities and towns.

Government Parallels

Federal,  state and local governments are very large employers.  Like corporations, they wield an enormous amount of economic power over their employees.  Moreover, public sector union employees are subjected to the same work issues as private sector employees.  It is hypocritical to deny them the same protections that private union employees enjoy.  These include protections against work bullying, harassment and unequal treatment to say nothing of the right to negotiate wages and salaries.

The private sector has suffered layoffs, pay cuts and diminished work hours.  The public sector has experienced the same deprivations.  The difference is that when local and municipality services are cut, residents are puzzled and then outraged as they should be.

When city or town offices are cut they should be outraged.

When libraries and community centersare closed they should be outraged.

When bridges, roads, buildings are decrepit or crumbling they should be outraged.

When their trash is not collected they should be outraged.

When nursing homes and veteran’s homesor elder care services are cut back or eliminated they should be outraged.

When hospital emergency rooms and ambulance services hours are reduced they should be outraged.

When schools close and students are jammed into inadequate space with deficient learning materials they should be outraged.

When public school bus service declines and school crossing guards cannot protect their children they should be outraged.

When tuitions increase beyond the reach of most working people they should be outraged.

When fire departments and police departments are cut threatening public safety they should be outraged.

When public transportation service is reduced or fares are raised exorbitantly they should be outraged.

When eating establishments fail to meet sanitary or food quality standards they should be outraged.

When tap water arrives at their homes with strange hues or bacteria they should be outraged.

When their rivers become dumping grounds for municipal, industrial, commercial and medical waste, they should be outraged.

When parks and recreation areas are hazardous to the public and become trash heaps, they should be outraged.

When sewers become clogged and spill over into their streets and yards, they should be outraged.

The nexus between public sector union services and private sector quality of life is demonstrably important.Anger against sector employees threatens the basic services of towns and cities that many have taken for granted.

Benefitting All

The standards that defined American job conditions and facilitated the growth of the middle class and benefitted the working class emanated from collective bargaining.  These included the 40-hour workweek, the weekend, vacation time, employer-supported health insurance, pensions, family and medical leave, and basic safety and health protections.

Work environment is also an important issue.  The union contract can preventsplenetic supervisors from unfairly unleashing their wrath on employees.

When unionsimprove the work conditions of their members, there is a concentric effect that can benefit all working people. The non-partisan Economic Policy Institute released a report in August 2003 concluding that unions have contributed to employment standards and practices adopted throughout the nation.  Pay and working conditions are often improved for the entire workforce.

Moreover, unionshave contributed to legislation and standards that benefit all working people such as the Occupational and Safety and Health Act of 1970 and the Family Medical Leave Act of 1993.

The historical record substantiatesthat when unions are strong, wages and salaries increase for all.  Health care coverage improves and pensions are strengthened. When private and public unions are weak the quality of life for our families and communities is jeopardized.

Finally, there is no correlation between states that have collective bargaining rights and states burdened with large deficits.  Data from the Bureau of Labor Statistics in January this year and the Center on Budget Policy and Priorities this February confirmed this.  States that deny employees bargaining rights such as Nevada, North Carolina, and Arizona have huge deficits of over 30 percent. Others states that possess bargaining rights such as Massachusetts, New Mexico, and Montana have smaller deficits of less than 10 percent.

State budget deficits are not the product of collective bargaining, but largely reflect the disastrous impact of our latest recession.  The test for states is to provide essential services to cities and towns with equitable budget and tax policies not geared to breaking the backs and spirits of middle and low income folks.

Unions aredemonstrably imperfect entities.  However, without collective bargaining rights, the game is flagrantly rigged for corporations and governmental bureaucrats.  Collective bargaining is the sine qua non for labor unions.  It is an instrument to ensure economic democracy.  Our cherished institution of political democracy requires an authentic economic democracyto achieve the aspirations of all working people.

Bruce Boccardy is President of SEIU Local 888 in Massachusetts

Today’s NYT article about IRS interest in pursuing gift taxes on contributions from individuals to “advocacy” 501 c/4 organizations, such as Americans for Prosperity or Crossroads GPS, both decidedly conservative, completes the ascent of corporate interests to dominance in our political system. Written by Stephanie Strom, normally the ambulance chaser of journalists focused on nonprofits, this article reports on the surprising news that the IRS is finally considering enforcing a tax it declared in 1982 to apply to contributions from individuals to 501 c/4 advocacy groups like the NRA, NARAL, and the Sierra Club, organizations whose “primary purpose” cannot be electoral, but rather legislative and policy. Non-primary purpose activities CAN support or oppose candidates but must remain below 49% of total expenditures; under recent rulings, this has permitted large anonymous contributions for what are essentially independent expenditure campaigns for or against candidates.

The end result: contributions to this category of advocacy organizations, that can be made anonymously, may now (after 29 years of silence from the IRS) be subject to a 35% gift tax. The work around, however, is pretty simple: give to a 527 organizations that can do elections work but contributions to which are not subject to tax by statute. The rub, of course, is that contributions to 527’s are reportable. No more silent manipulation of the process.

But wait a minute…what about corporations? The hotly debated “Citizens United” decision issued last year by the Supreme Court reasoned that because the law had evolved to treat corporations as “persons” in certain ways, they were entitled to free speech, and under prior Court decisions, “speech” meant the ability to spend money in politics, including the ability to make anonymous contributions to 501 c/4’s.

But this is where it gets interesting. Corporations are treated as persons in only some ways. The tax system doesn’t treat corporations as people in other regards, so they aren’t subject to gift tax. Thus, the effect is that, now, untaxed anonymous political giving shall be the exclusive domain of corporations. Ta Da!!

That the Roberts Court is turning into the most activist Court in modern memory comes as no secret. But it is remarkable how quickly their well-chosen decisions is advancing the agenda of the free market, anti-government business interests. This is likely just the beginning – tilting the odds yet again in favor of corporate power and against individual rights and liberties. And looking into the near-term future, one has to like those odds for Republicans. The Tea Party folks are the wildcards, but somehow I’m not optimistic that they will unravel the unholy alliance between Big Business and the social conservatives. Meanwhile, get ready for one of the worst campaign seasons ever, fueled especially by anonymously given corporate contributions.

*** Below is a special note from Social Policy Pubisher Wade Rathke***

Peter Cervantes-Gautschi’s article, Wall Street & Our Campaign to Decriminalize Immigrants from the Winter issue of Social Policy has been named the 5th most censored story of 2010-2011 by Project Censored.

Normally when a new issue of Social Policy comes out, the articles from the previous issue moves behind a subscription wall - but in the case of this article, we’ve decided to make it free-feature on the front page of

We’re proud of Peter and honored to be part of getting the story out.  We’re also thankful for your support that allows Peter’s voice to be heard because readers and subscribers have made Social Policy a magazine that matters.

Enjoy the read!

Wade Rathke, Publisher

Social Policy



Over the past four years roughly a million immigrants have been incarcerated in dangerous detention facilities in our taxpayer-financed private prison system. Children were abused, women were raped, and men died from lack of basic medical attention.

Corrections Corporation of America (CCA), based in Nashville, Tennessee, and the GEO Group, a global corporation based in Boca Raton, Florida, the nation’s two largest companies that design, build, finance and operate prisons, are principal moving forces in the behind-the-scenes organization of the current wave of anti-immigrant legislative efforts which, if successful, would dramatically increase the number of immigrant prisoners in over twenty states.

A little over a year after its October 2003 success in securing the contract to run GITMO (the Guantánamo Bay Detention Camp) in Guantanamo Bay, Cuba, GEO hired the services of lobbyists who had recently held influential positions with the U.S. Department of Homeland Security, Bureau of Prisons, Office of the Attorney General, and then Senate Majority Leader George Mitchell to lobby their former employers and Congress. Through 2005 and leading up to the largest immigration raid in U.S. history in December 2006, GEO and CCA spent a combined total of over $6 million on these lobbying efforts.

On May 1, 2006, while GEO and CCA were lobbying the federal government for more business, millions of people marched in favor of immigrant rights in 102 cities across the country. The marchers, despite their historic numbers, turned out to be an insufficient barrier to the government’s support of GEO’s and CCA’s business plans. This single change in enforcement of existing law created a potential of over ten million new felons, thereby multiplying the lucrative incarceration market for the private prison industry many times over, and sending a shock wave through immigrant-related communities across the country. The December 2006 raid, in which over a thousand men and women employed at Swift meat-packing plants in several states were detained, marked a change in the federal government’s enforcement of the 1995 immigration law. For the first time, many of those picked up were charged with crimes that carry long prison sentences.

At the time of the Swift raid, USA Today quoted the Reverend Clarence Sandoval of St. Thomas Aquinas Catholic Church in Logan, Utah, as saying, "They are taking mothers and fathers and we're really concerned about the children. I'm getting calls from mothers saying they don't know where their husband was taken."

Soon after the Bush Administration implemented this change in law enforcement affecting immigrants, Wall Street advisors publicly recommended buying stock in private prison companies like CCA and GEO. At the time, Vice President Dick Cheney was heavily invested in Vanguard, one of a handful of major shareholders in GEO.

The lobbying paid off for both companies in huge revenue increases from government contracts to incarcerate immigrants. From 2005 through 2009, for every dollar spent on lobbying the federal government, GEO received a $662 return in taxpayer-funded contracts, for a total of $996.7 million. CCA received a $34 return in taxpayerfunded contracts for every dollar spent on lobbying the federal government, for a total of $330.4 million. In addition, both companies increased revenues over the same period from detention facility contracts with a number of states.

In 2007 the Immigration and Customs Enforcement Agency (ICE) conducted 30,407 immigration raids in workplaces, neighborhoods, and public gathering sites such as bus stops and commuter train platforms. The number of raids conducted that year was double the 2006 total. The number of immigrants placed behind bars, for what amounts to the crime of having been born in the wrong place, increased from 256,842 in 2006 to 311,169 in 2007.

As a result of fear induced by the raids and other factors, pro-immigrant May Day marches in 2007 were much smaller than those of the previous year. In mid-2007, while many organizers were focused on legislation, marches, and raids, GEO and CCA shareholders reaped a huge profit. Both companies issued 2-for-1 stock splits that roughly doubled the value of their shareholders’ stake in the two companies.

Although stockholders profited handsomely as revenues from prison contracts rose for both companies, the increase was not large enough to satisfy some of their respective major shareholders. JPMorgan Chase, a major owner of GEO, dumped its stock and relinquished a leadership position in the company.

One problem for investors seeking huge gains from the for-profit prison business was that revenue rates could not keep rising because federal agencies did not have enough personnel to arrest and process more immigrants than the expanded number they were now handling. It became apparent that the only way to raise revenue significantly through increasing the numbers of people picked up, detained, and incarcerated was to hire more law enforcement personnel. The private prison industry now needed a new source of low-cost licensed law enforcement personnel. The new focus of business expansion for CCA and GEO apparently then became state governments.

The result of this shift in business focus is exemplified by CCA’s role in Arizona’s SB 1070 and both CCA’s and GEO’s roles in other legislative efforts aimed at dramatically increasing the arrest numbers for undocumented immigrants in over twenty states. Arizona’s Governor Jan Brewer, who received substantial campaign financing from top CCA executives in Tennessee and employs two former CCA lobbyists as top aides, signed SB 1070 into law on April 23rd.

On Friday, July 30, 2010, the Republican Governors Association, which so far this year has received over $160,000 in contributions from CCA, GEO, and their lobbyists, sent out a nationwide solicitation written by Arizona Governor Jan Brewer requesting contributions to fund an appeal of the partial injunction issued by a judge against SB1070.

In addition to funds raised by the partisan appeal, Brewer’s legal effort has been bolstered by supporting briefs filed with the appeals court by three states that have contracts with GEO or with both GEO and CCA. The two prison companies are currently ramping up their political involvement in these states and in several others that have anti-immigrant bills moving through their respective legislatures. In all, twenty states are considering SB 1070 inspired bills which have been endorsed by their respective Republican gubernatorial candidates, who are in large part financed by the Republican Governor’s Association.

CCA and GEO are owned by major Wall Street institutions that profit from the immigrant incarceration business. The United States now has more people in prision than any other country on earth. Last November, CCA’s top management in Tennessee contributed the largest block of out-of-state campaign contributions received by Arizona Governor Jan Brewer. CCA, which already has several detention facilities in Arizona and is hoping to expand its immigrant prison business in that state, is expected to show a huge increase in revenues when SB 1070 is implemented. Brewer’s administration, in a gesture welcomed by armed white supremacist vigilante groups aligned with notorious Sheriff Joe Arpaio, recently implemented a law allowing concealed weapons to be carried in public. Both CCA and GEO, which rely almost exclusively on revenue from tax dollars at local, state, and federal levels, profited from the incarceration of immigrants apprehended by U.S. Immigration and Customs Enforcement (ICE) in 2006, after the Bush Administration changed the charge for working without a proper social security number from a misdemeanor violation with a short jail sentence to a felony violation carrying a long prison sentence.

The change in how federal law is enforced increased the market of potential immigrant inmates for CCA and GEO by more than ten million people that the government would pay to have housed, transported, and fed. CCA’s and GEO’s share of the immigrant incarceration business has grown substantially since 2006. Today, for example, anyone picked up by ICE in Los Angeles is sent to a CCA facility in San Diego, while those picked up by ICE in Seattle or Portland, OR, are sent to a GEO facility in Tacoma because detention facilities owned and operated by the federal government are at 137% of capacity. The most powerful investor in CCA is a hedge fund, Pershing Square, which is run by Wall Street investment guru activist investor, Bill Ackman. Ackman also plays a powerful role in Target Corporation and Kraft Foods. Wells Fargo is the most powerful investor in GEO. Other major investors with the power to influence management in one or the other of the two companies are Vanguard, Lazard, Scopia, Wellington Management, FMR (Fidelity), and Bank of America. Each of these major owners is sensitive to public opinion in one way or another.

None of these major investors needs to rely on either CCA or GEO to make money. By almost any measure, the increased number of deportations of immigrants has not had the desired effects on anyone other than the private prison industry. Unemployment among native-born citizens in the U.S. has skyrocketed even as the number of immigrants being deported has risen to over 400,000 a year. At over two million, the U.S. has a half million more people behind bars than China, which has the second highest number of prisoners among the nations of the world. One would like to think that bringing this information to Congress’s attention would be enough to compel them to abandon policies that criminalize immigrants. However, that is not likely to happen soon.

This probable hesitation for Congress to act is not merely because of the substantial campaign contributions that Senators and members of Congress receive from the private prison industry. Most members of Congress have personal investments in one or more of CCA’s or GEO’s major shareholders. While it is true that many people are invested in CCA or GEO through their pensions without knowing it, the reports on the personal finances of some key members of Congress suggest some of them have more than a casual interest in the fortunes of CCA or GEO.

Senator Enzi, a senior Republican who sits on the Senate Budget Committee, was awarded a 100% approval rating by U.S. Border Control, which describes itself as “a non-profit, tax-exempt, citizen's lobby. USBC is dedicated to ending illegal immigration by securing our nation's borders and reforming our immigration policies.”

Compelling Congress to abandon immigrant criminalization policies is probably going to require, among other things, that we convince some combination of our pension funds, Wells Fargo, and a hedge fund or two pull out of the private prison industry and to go elsewhere to make money. Who knows? Some of these financial institutions might even see the wisdom in investing in companies that produce family wage jobs. Peter Cervantes-Gautschi, Co-Director of Enlace, has been a labor activist since 1965, starting as a farmworker in California. He has organized for HERE, SEIU, and CWA, headed two labor councils, started two low-wage worker organizations, and co-founded several labor-community coalitions, membership organizations, and political action committees.

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