As part of his pledge to promote racial equity, president Biden signed an executive order calling on the justice department to end federal contracts with private prisons.
"We must change now," the president said. "I know it's going to take time, but I know we can do it. And I firmly believe the nation is ready to change. But government has to change as well." Read full AP story here.
News of the official order sent shares of private prison stocks plummeting. CoreCivic and GEO Group stocks dropped over 7% immediately after the news broke.
But could this signal a potential buying opportunity for these beaten-down stocks?
According to The Marshall Project, both CoreCivic and GEO Group have anticipated this move years ago, and have moved away from full-time incarceration facilities to halfway houses and prisoner-monitoring services, like ankle brace monitoring.
In Texas and many other states across the country, private prisons are major employers in rural counties, so the economic impact of shutting them down could be regionally devastating.
But can these facilities be re-designed and have staff retrained for other uses?
- Mental Health Centers - The Harris County Jail (Houston) is largest provider of mental health services in the State of Texas. Think about that for a second. People are committing crimes in order to receive the mental health services they need but can't afford. Schizophrenia, bipolar disorders, and other debilitating diseases could be treated compassionately in these facilities until patients are stabilized and returned to society with access to the medications they need to function in society. People suffering from mental health problems should never have to get arrested to get the treatment they need.
- Substance Abuse Recovery - Sections of facilities could be used to provide short-term care and counseling for patients addicted to alcohol and highly addictive narcotics. Provide the care, nutrition, individual counseling and group therapy needed to help return these patients back to the community in a position to thrive.
- Immigration Holding Facilities - Keep families together while they await their cases to be heard.
- Community Emergency Health Centers - Many rural hospitals have closed down across the country. Provide the funding so that basic health services can be administered in these facilities without the need to travel to a major city for potentially life-saving help.
These are just a few thoughts off the top of my head. But I do believe the role of private prisons in America can change from becoming warehouses for incarcerating people for profit to vital and compassionate institutions that provide real benefit to society.
But a lot will need to change.
