The Journal of History     Winter 2003     TABLE OF CONTENTS
America's Concerns  
Prison Phone Calls

It appears whether we are fighting for vaccine safety, peace, or prison reforms ---we are fighting the same corporations. Prisons are big business and we are eating our own populations in order to compete on a global world level.

MCI just put in a new California Department of Corrections phone system to the prisons. It will cost a $50 minimum for a collect call for 4 units to be billed to prisoner family or friends or legal advocates.

Unless the people who received calls from prisoners call MCI and see if they are the automatic blocking list, and therefore, have to give a credit card or prepare with money orders--the families will not know that the prisoners can no longer call them. This will take place Feb. 2, 2003. It is cheaper for us to call China than a prisoner to call the next town to speak to his/her mother within California.

Tough-on-Crime Measures Increase Prison Population

ALEC's corporate members include at least a dozen companies that do prison business. Like Dupont; the drug companies, Merck , and Glaxo Smith-Klein; and the telephone companies that compete for lucrative prison contracts. And Corrections Corporation of America (CCA). It dominates the private prison business -- building and running prisons and renting cells to governments. At last count the company housed 55,000 inmates in 65 facilities in twenty-one states and Puerto Rico, says CCA Vice President Louise Green.

Prison vendors who've contributed to, or are members of, the American Legislative Exchange Council (ALEC):

*    Ameritech
*    AT&T
*    Bayer (Sheffield Plastics division)
*    Bell Atlantic
*    Bell South
*    Corrections Corporation of America (CCA)
*    DuPont Company
*    GlaxoSmithKline
*    MCI
*    Merck & Co.
*    National Association of Bail Insurance Companies
*    Schering Plough
*    Sodexho Marriott (until recently a major investor in CCA)
*    Sprint
*    Turner Construction
*    Qwest (formerly US West)
*    Pfizer
*    Wackenhut Corrections
Sources: ALEC, American Correctional Association

Neither CCA nor the American Legislative Exchange Council will say how much CCA pays for its ALEC membership. The latter group's corporate memberships go for $5,000 to $50,000 a year. Green says belonging to ALEC gives the corrections corporation a chance to explain the benefits of privately-run prisons to state lawmakers -- "that if those states and counties have considerable overcrowding in their jails and prisons that partnering with a private corrections company can realize cost savings to their taxpayers and we can offer effective programming for their inmates."

But CCA does more than chat up lawmakers at ALEC meetings. On top of its membership dues and contributions to help pay the bills for ALEC meetings, the prison company pays two thousand dollars a year for a seat on ALEC's Criminal Justice Task Force. That panel writes the group's "model" bills on crime and punishment. Until recently, a CCA official even co-chaired the task force. For years, ALEC's criminal justice committee has promoted state laws letting private prison companies operate. And at least since the early 1990s, it has pushed a tough-on-crime agenda.

ALEC officials say proudly that lawmakers on the group's crime task force led the drive for more incarceration in the states -- "and really took the forefront in promoting those ideals and then taking them into their states and talking to their colleagues and getting their colleagues to understand that if, you know, we want to reduce crime we have to get these guys off the streets," says ALEC staffer and Criminal Justice Task Force director Andrew LeFevre.

Among ALEC's model bills: mandatory minimum sentences; Three Strikes laws, giving repeat offenders 25 years to life in prison; and "truth-in-sentencing," which requires inmates to serve most or all of their time without a chance for parole. ALEC didn't invent any of these ideas but has played a pivotal role in making them law in the states, says Bender of the National Institute on Money in State Politics.

"By ALEC's own admission in its 1995 Model Legislation Scorecard, they were very successful. They had introduced 199 bills [that year]. The Truth-in-Sentencing Act had become law in 25 states, so that right there is fairly significant."

By the late 1990s, about forty states had passed versions of truth-in sentencing similar to ALEC's model bill. Because of truth-in-sentencing and other tough sentencing measures, state prison populations grew by half a million inmates in the 1990s even while crime rates fell dramatically.

The result: more demand for private prison companies like CCA.

*    Prison Facts and Figures:
*    In 1997 2,583 staff members were assaulted by inmates in California. Thousands of the inmates are HIV-positive; thousands more carry hepatitis C.
*    "Gassing" became a problem - to struck by a cup or bag containing feces and urine.
*    California prison system, especially its Level 4 facilities, is full of warring gangs -- members of the Crips, the Bloods, the Fresno Bulldogs, the Aryan Brotherhood, the Nazi Lowriders, the Mexican Mafia, and the Black Guerrilla Family.
*    Random acts of violence.
*    Police brutality - at Corcoran State Prison officers allegedly staged "gladiator days," in which rival gang members were encouraged to fight, staff members placed bets on the outcome, and matches often ended with inmates being shot
*    double-bunking and prison overcrowding with higher rates of stress-induced mental disorders, higher rates of aggression, and higher rates of violence.

The Rise of Prison-Industrial Complex

*    In the last 3 decades - prison industrial complex had been developed in the US-- confluence of special interests that has given prison construction in the United States a seemingly unstoppable momentum.
*    Since 1991 the rate of violent crime in the United States has fallen by about 20 percent, while the number of people in prison or jail has risen by 50 percent. Increase because of imprisonment of people who have committed nonviolent offenses. Instead of community service, fines, or drug treatment - to a prison term, by far the most expensive form of punishment.
*    politicians, both liberal and conservative, who have used the fear of crime to gain votes;
*    impoverished rural areas where prisons have become a cornerstone of economic development;
*    private companies tap into $35 billion a year spending on prisons
*    Spending on corrections since 1980s increased 5 times; there are more than 1000 vendors that sell corrections paraphernalia;
*    The growth projected 5-10% annually;
*    Private prisons keep 90,000 prisoners from 27 states
*    "Bed brokers," rent a cell facilities ($20 to $60 a day with $2.50-5.50 commission per man-day); trucking prisoners hundreds of miles through the country - threat to public order; escapes;
*    Wackenhut Corrections, second largest private-prison company has ravenous $1 billion a year;
*    U.S. Corrections Corporation - the largest private-prison company wants to buy and run all state of Texas' prisons;
*    globalization of the private-prison business: British private-prison company, Securicor, operates two facilities in Florida; Wackenhut Corrections is now under contract to operate prison in England; three prisons in Australia; and a prison in Scotland. It is actively seeking prison contracts in South Africa.
*    1 pay phone in prison generates $15,000 a year; MCI installs phones for free;
*    Government officials whose fiefdoms have expanded along with the inmate population. Despite promises to consider alternative bids for a controversial prison phone contract, the state decided earlier this year to renew an altered version of the $60 million deal for another three to four years.

"It is very disconcerting," said Charles Carbone, legal director of California Prison Focus, a San Francisco nonprofit that fights for inmates' rights. "The fundamental wrong is that this contract should have been opened for competitive bidding."

The renewed contract, which allows WorldCom and Verizon to provide pay phone service at prisons and other government facilities, raises questions about whether California frequently circumvents its own competitive bidding rules, handing deals to favored companies and campaign contributors instead of shopping around.

The Chronicle reported Friday that the state awarded billions of dollars in no-bid deals over the past three years -- going far beyond the current scandal surrounding the state's $95 million pact to buy Oracle software, which followed a $25,000 campaign contribution from the Bay Area firm.

Both WorldCom (which uses the MCI brand name) and Verizon gave Davis (Governor California) substantial campaign contributions last year at the same time the state was considering awarding the contract to a new bidder. Worldcom gave Davis $13,000 in March and April last year. And Verizon gave Davis $25,000 in May 2001, plus another $35,000 later in the year. The state decided to cancel the contract competition in June.

The Department of General Services, which administers state contract bidding and awards, estimates the contracts are worth $54 million to WorldCom and $6 million to Verizon (though the money comes from callers, not the state).

WorldCom controls the pay phones in 29 state prisons, while Verizon has just four.

The general services manager who helped oversee the contract award denied the contributions influenced the process, saying he wasn't even aware of the donations.

"I have no contact with the political committee . . . and it has never come up," said Barry Hemphill, deputy director of the agency's telecommunications division.

Verizon spokesman Jonathan Davies said the timing was "purely coincidental. " He said the company gave the donation at a fund-raiser attended by a large number of firms. WorldCom spokeswoman Natasha Haubold referred calls to other company representatives who could not be reached.  


The prison phone contract in question has been controversial for years, with critics accusing the telephone companies of gouging families of inmates by charging exorbitant rates for the use of pay phones. A single one-minute collect call can cost up to $4.84. (For security reasons, prisoners are usually barred from carrying calling cards and are forced to call collect.)

Some family members have complained their bills have run into hundreds of dollars a month. And critics say WorldCom routinely makes billing errors that drive up the cost even higher.

"It is absolutely outrageous that the state has allowed corporations to attack the most vulnerable people," says Dorsey Nunn of Menlo Park, who spends $50 a month on calls from his brother's girlfriend in the state prison in Stockton.

State officials said they tried to seek alternate bids last year, but observers said the the initial request for proposals was so confusing that few vendors bothered to submit bids. And the Department of General Services wound up rejecting all the bids it did receive for various reasons.

"It was just a mess," said Sen. Debra Bowen, D-Marina del Rey.

In a letter explaining the extent of California's no-bid contracts, general services lawyer Laurie Giberson wrote the state must sometimes award no-bid contracts after a "failed competition" because it doesn't have time to repeat the process.

But a Pasadena attorney who teaches a course in government contracts pointed out that general services could have simply extended the old pay phone contracts for a few months -- instead of awarding them new deals for three to four years.

"It is no excuse at all," said Laurence Lubka, managing partner of Hunt, Ortmann, Blasco, Palffy & Rossell and an instructor of continuing legal education. "It's probably in their interest to have lots and lots of difficulties because they can no-bid everything."

The Department of General Services, however, offered another reason for awarding the no-bid contracts.

Hemphill said the state is considering overhauling the phone system in a few years and didn't think it made sense to switch vendors in the interim. Hemphill said a new phone company would have to install its own pay phones in dozens of security-conscious facilities -- "disrupting the operations at prisons."

But Carbone, who frequently visits prisons in his nonprofit work, disputes the explanation.

"They are constantly making changes at institutions, such as changing locks and doors," said Carbone, a telecommunications attorney who used to work for a San Diego watchdog group that filed one of the original complaints against WorldCom's prison phone contracts. "They are well equipped to do this."

The General Services department also pointed out that the contract was originally awarded to WorldCom and Verizon through a competitive bidding process more than a decade ago.  


Regardless, two state legislators said they are more concerned with the fact that the state receives a large portion of the pay phone revenue -- forcing WorldCom and Verizon to charge higher rates to recoup their costs -- than the fact that it was a no-bid award.

Over the past two years, the state has earned about $35 million a year from the contracts.

"It is grossly immoral," said Sen. John Vasconcellos, D-San Jose. "I don't care who the vendor is. I care about people getting a fair shake."

Though Bowen said she wishes the contract was awarded through a competitive bidding process, she adds: "I am much more concerned about the policy of socking it to the families of prisoners."

Two years ago, the state passed legislation to require the Department of General Services to award the pay phone contract to the company that offered the lowest rates, rather than who could generate the most revenue for the state coffers. But Davis vetoed the legislation, saying he didn't want to give up the revenue stream.

Hemphill, though, insists the new contracts are better for inmates' families. He said the state agreed to trim its take to $26 million a year, plus $1 to administer the contract.  


In addition, WorldCom and Verizon have agreed to slash the rates by 25 percent at adult prisons and 78 percent at state hospitals and juvenile correction facilities.

WorldCom spokeswoman Haubold said the prison prices are now cheaper than they are at its public pay phones. She said the surcharge at public pay phones ranges from $4.35 to $4.99, compared to a maximum of $3 for its state prison phone contracts. (According to WorldCom's new contract with the state, the company actually charges surcharges as high as $3.95 at prison pay phones, but those are still lower than the prices it says it charges elsewhere.)

Under the new rates, prison inmate calls cost 15 cents to 89 cents a minute -- plus a $1.50 to $3.95 surcharge per call.

Carbone remains unimpressed. "They are taking astronomical rates and
knocking off a few pennies and nickels," he said.

E-mail Todd Wallack at


The Journal of History - Winter 2003 Copyright © 2003 by News Source, Inc.