In the Public Interest’s weekly privatization report

1) National: A powerful New York Times piece by Sonia Nazario shines a light on the systematic government denials of asylum due process and access to detainee legal rights that is feeding the private detention-industrial complex.

“Adelanto is one of the deadliest immigration prisons in the United States,” Nazario writes. “Three people perished there in a three-month period last year. According to Michael Kaufman, a lawyer with the American Civil Liberties Union of Southern California, medical care at Adelanto suffers because the company that owns it, the GEO Group, cuts corners to save money. Women there told me there are maggots and mold in the food sometimes. The prison pays $1 for a day of work cleaning or in the kitchen. (…) Occasionally detainees crack under the strain: Last year at Adelanto, a Haitian woman tried to hang herself and a Russian woman tried to kill herself using nail cutters. Adelanto, like most immigration prisons, is so isolated that most detainees don’t have a lawyer. Nine in 10 asylum seekers with no lawyer lose; nearly half with a lawyer win. Despite all this, what they have fled is so terrifying that many are willing to stick it out at Adelanto for months or years.”

A year ago, a hunger strike broke out at the Adelanto ICE detention center by people demanding medical care and release pending their immigration court dates.

2) National/California: Victorville federal prison is staggering under the weight of the number of new immigrant detainees being sent to it. “Workers and people who have been able to visit the detainees say the prison was seriously unprepared for its new role. The prison, which workers have long complained was short-staffed, is now scrambling to care for hundreds of new detainees from around the world with language, medical and care needs that are very different from those of typical federal prisoners, workers say. The situation has raised concerns among Democratic and Republican lawmakers. (…) One worker who spoke to The LA Times on the condition of anonymity for fear of retaliation said medical workers are stretched so thin they can address only detainees’ most urgent needs. ‘We’re not finding illness because we are so rushed,’ the worker said. ‘As patients, they’re not getting the care they need.’”

3) National: Less than a week after Reveal broke the story that MVM Inc., a military  contractor with CIA ties, was detaining immigrant children in an unmarked office building in Phoenix, the company has terminated its lease on the property.  

4) National: Win Without War is circulating a petition demanding that the Trump administration cut its contracts with companies like General Dynamics and MVM Inc. that are profiting off detaining migrant kids.

5) National: Writing in Correctional News, Daedalus Howell looks at whether inmates do more time if they’re in private vs. public prisons. “So, why are inmates in privately operated facilities doing more time? The reason for their delayed release appears to be linked to the widespread use of conduct violations. In fact, as Mukherjee found, inmates in private prison are 15 percent more likely to receive conduct violations. ‘This may happen because private prison guards are more likely to report bad behavior or because conditions in private prison are worse [or] ‘too hot,’ said Mukherjee, who cited evidence of this from a panoply of ACLU lawsuits.”

6) National: Jeremy Mohler of In the Public Interest talks about the ties between tax cuts and privatization, saying “Let’s stop pretending that cutting taxes doesn’t kill people.” He writes, “it’s not that [health care corporation Centene’s CEO Michael] Neidorff profits from insuring the poor. It’s that Centene has repeatedly cut corners to increase those profits. (…) Yet, if the Trump administration and Congress have their way, Centene, already the nation’s largest Medicaid provider, could grow even larger. That’s because last year’s corporate tax cuts have created a trillion dollar hole in the federal budget, and Republican lawmakers want to fill it by cutting so-called ‘entitlements.’”

7) National: The American Federation of Government Employees (AFGE) reports widespread union busting actions by the Trump administration following its issuing of workforce executive orders intended to prevent them from performing duties that are required by law. “Union leaders representing employees at the Social Security Administration, the Veterans Affairs Department and the Bureau of Prisons said management is moving to evict unions from office space, preventing them from taking documents off-site and blocking them from using official time or unpaid leave to represent workers.”

Trump’s crackdown on workplace rights is hitting U.S. Bureau of Prisons employees hard, even as they struggle under the weight of the massive increase of new immigrant detainees (see above re: Victorville). “AFGE Local 3969 President John Kostelnik, who represents employees at the Bureau of Prisons, said during the news briefing that the order limiting the ability of federal employees who are also union officials to act on behalf of BOP employees is endangering the workers. ‘These orders have attempted to silence us. The union’s voice is related to the safety of the staff,’ Kostelnik said.”

8) National: Both CoreCivic and the GEO Group have announced the dates of their next profit reports and conference calls. CoreCivic will release its 2018 second quarter financial results after market close on August 8. A live broadcast of its conference call will begin at 10:00 a.m. central time (11 AM ET) on August 9. The GEO Group will release its financial results on August 2 before the market opens. Its conference call will take place shortly afterward at 11AM ET. Last Tuesday, GEO Group declared a quarterly cash dividend of $0.47 per share. With 123 million shares outstanding, that amounts to a $57,810,000 payout to its shareholders.

9) National: LittleSis’s Derek Seidman reports that Steve Bannon, the architect of Trump’s election and founder of the “platform for the alt-right,” will be one of the high profile speakers at an investment conference this Wednesday. “At a time when millions of people are outraged over the Trump administration’s cruel immigration policies, major banks and money managers that are profiting off of Trump’s detention and deportation machine are getting set to host Steve Bannon, the former Breitbart editor who was a key architect of Trump’s rise to power and served as his top advisor.”

10) National: The private water industry is headed for a major corporate mergers-and-acquisitions shakeup, Reuters is reporting. “An acrimonious four-way, transcontinental battle to create the nation’s third-largest water entity has seized the attention of industry executives gathered for an annual confab in Minneapolis this week. States like California are trying to push their smaller operators together. Even energy firms are considering H2O deals.” Smaller utility peers, the vast majority owned by governments, may be gobbled up en masse.

11) National: American Water has agreed to sell 23 of its 33 operations and maintenance (O&M) contracts to Veolia.

12) National: After having been reportedly slapped down early in the Trump administration on his plans to privatize the war in Afghanistan, mercenary contractor (and Betsy DeVos brother) Erik Prince is at it again, reports The Hill. “Prince promoted the plan in a YouTube video released Tuesday that coincided with the recent NATO summit in Belgium. ‘The Pentagon does what it does and wanted to keep doing the same thing it has done for the last 17 years,’ Prince said in the video. He said CIA officers and 6,000 mercenaries should take charge in the conflict.”

13) National: The big private government consulting firms, already battered by a string of ethical and performance scandals, are fleeing ICE. The New York Times reports that “McKinsey & Company, the prominent management consultancy, has stopped working for Immigration and Customs Enforcement after the disclosure last month that the firm had done more than $20 million in consulting work for the agency. The revelation prompted questions from employees at the firm.” Over at Deloitte, employees “are calling for the firm to end its consulting for Immigration and Customs Enforcement, circulating a petition saying they have ‘moral objections’ to the work.”

14) NationalBianca Tylek and Connor McCleskey of the Corrections Accountability Project dig into Securus’ acquisition of ICSolutions and its implications for inmates and families. “In May, Securus announced that it would acquire Inmate Calling Solutions (ICS), a smaller competitor, for $350 million — extending its reach to over 260 new facilities. The deal may seem like just the latest in a series of acquisitions that have cost the company nearly $600 million in the past six years. But this purchase marks a turning point for the company that raises grave concerns for the industry and those it serves.”

15) National: Politico digs through Supreme Court nominee Brett Kavanaugh’s record on education policy and finds plenty of material that should concern supporters of public education. They report, “Kavanaugh said during his 2004 Senate confirmation hearing that he had previously served as the co-chairman of the Federalist Society’s ‘School Choice Practice Group.’ Kavanaugh also said, in response to written questions, that he had ‘worked on school choice litigation in Florida for a reduced fee.’ He didn’t provide additional details about that matter. On private school choice, Kavanaugh predicted in a TV appearance in 2000 that school vouchers would one day be upheld by the Supreme Court.” Kavanaugh serves on the board of directors at Washington Jesuit Academy.

16) Arizona: A charter school management board admits it broke state law when it blocked public comment at a budget meeting, and scheduled a new meeting. “A day earlier, the Republic first published an investigation on azcentral.com that found businesses tied to ALA founder Glenn Way had made millions of dollars building campuses for the charter chain.”

17) California: Officials in Riverside County have discovered a shortcut on the school-to-prison pipeline that is feeding the bottom lines of profiteers like CoreCivic and GEO Group. They want to put juveniles on probation for bad grades in public schools, arguing that poor marks in math and English are signs of “pre-delinquency.”

18) Connecticut: Library Systems & Services is making a big sales pitch to privatize the libraries in Ledyard. “Library Systems & Services presenters said the company offers jobs to all town employees when it takes over a library system but not every employee accepts and, after some time, there is attrition. Connecticut Library Association President Kate Byroade, who attended the meeting, said this is because Library Systems & Services would put forth less money than the town pays. She also said LSS wasn’t offering anything different than what Ledyard already has in place.”

19) Florida: A ballot proposal seen as promoting more charter schools by letting supporters sidestep county school boards “was challenged as misleading Thursday in a lawsuit by the Florida League of Women Voters. The league is asking a Leon County court to remove from the November ballot proposed constitutional Amendment 8 that was placed there by the state’s Constitution Revision Commission.”

20) Georgia: Changes in state policy on charter schools approvals “mean Coweta County no longer needs to clarify requirements for those wishing to open charter schools. From now on, applicants will be directed to Georgia Board of Education guidelines and state law for specific instructions on how to submit a petition to the Coweta County Board of Education to open a charter school in the county.”

21) Illinois: The Chicago Public Schools have killed off a $60 million contracting deal with GCA at the last minute because the company “has a poor history of protecting its janitors from sexual harassment,” the Chicago Sun-Timesreports. “GCA Educational Services Central States Inc. was being recommended for the lucrative, three-year deal to manage facilities services at 34 Chicago schools, including cleaning, which has become an issue amid reports of filthy schools.” The Sun-Times“confirmed it was because GCA’s parent company, ABM Industries, Inc., has had a series of problems keeping its janitors safe on the job. ABM was featured in the 2015 PBS ‘Frontline’ documentary ‘Rape on the Night Shift’ about women who were sexually harassed and assaulted while working as night janitors in California.”

22) Indiana: As charter school accountability rises, so do charter school closures, reports the Journal-Gazette. “Nationally, more than 300 new charter schools opened during the same time period, and there were 238 closures. More than 3.2 million students attend charters around the country. Rausch said the average closures per year nationally were between 150 and 175 but that has jumped the last four years. He said that’s partly because there are more charters overall but also because authorizers and state policy makers have gotten serious about accountability.”

23) Massachusetts: New Bedford Mayor Jon Mitchell says charter schools need democratic accountability, just like traditional schools do. “Despite these fiscal constraints and attendant political risks, the city of New Bedford has committed itself to wholesale reform of its public schools and found the resources necessary to back up those reforms. Leaders from across our community stepped up and displayed admirable courage in an effort to put our school district back on an upward trajectory. And yet charter schools get a free pass from this local democratic, deliberative process, as funds that would otherwise be available for municipal purposes are simply redirected each year without any real public process at all.”

24) Nebraska: Public officials in Lincoln are stepping up to the plate and proposing to replace lead water service lines that lead into residents’ homes for freeto avoid any future problems with lead in the city’s drinking water. “This is an excellent project that definitely prioritizes the public’s health,” said Charlotte Burke, a division manager with the local Department of Health.

25) New York: The Public Service Commission (PSC) is taking New York American Water (NYAW) to court “over the company’s rate rigging issues, which were discovered several months ago after an extensive investigation was launched. The PSC released a report in late June revealing that NYAW had made inaccurate filings with the New York Office of Real Property Tax Services in addition to withholding information from the PSC during rate proceedings.”

26) New York: The New York Post is reporting that private donors are massively boosting the compensation of charter school executives. “Geoffrey Canada, who stepped down as CEO of the Harlem Children’s Zone in 2014, received a whopping $1 million bonus the following year when he began serving as president of the nonprofit organization which operates two charter schools and a variety of other programs.”

27) Pennsylvania: Pittsburgh Mayor Bill Peduto met with In the Public Interest Executive Director Donald Cohen for more than an hour last Wednesday to discuss best practices and essential questions regarding ‘public-private partnerships.’ “Cohen says public-private partnerships to address water system needs can work, but their focus must be on the public interest. ‘A couple of really important things to understand—there’s only one source of money for infrastructure in America, and that’s you and I,’ Cohen said. ‘We either pay in through taxes, through tolls if we’re on a road, or through fees if we’re using water.’ That’s the only place to pay for it. Any investment that gets made by a private entity is just debt to the city because the ratepayers have to pay it back.’ Cohen said, ‘The question becomes what’s their rate of return, what’s their expected rate of return on their investment, and do we need to pay for that, which could be 10 percent or more if it’s private money.”

The city is reviewing possible options on governance for its water and sewer authority this week. A public hearing will be held Wednesday. “On a related front, council wants to eliminate an option that could let PWSA buy the water infrastructure from the city government as early as 2025. PWSA operates the drinking-water and sewage-conveyance systems under a long-term city lease. Dropping the purchase option would help ensure PWSA isn’t privatized, council members have said. The future of the purchase option also appears on the hearing agenda.”

28) Tennessee: A tax-free bond deal has been approved for a new KIPP charter school in Antioch. “Arguing against the deal, council member Dave Rosenberg—an outspoken critic of charter schools—said approving the bonds would be like stabbing the Nashville school board in the back, because charter schools now know they can go to the state for approval and then to this board for their capital needs.”

29) Texas: A major private equity firm and state contractor, EnCap, has been fined $500,000 by the Securities and Exchange Commission for alleged political contributions to candidates in the governor and attorney generals’ races in 2013 and 2014. “‘This is unfortunately real common,’ said Chris Tobe, a former Kentucky Retirement Systems trustee and author of the book Public Pensions, Secret Investments. ‘Most of these donations, though, are underground because of Citizens United. This is the tip of the iceberg.’ He said the detection of the contributions was probably ‘something they accidentally let into the light.’”

EnCap was named in a number of stories linking top U.S. universities to offshore funds that came to light through the surfacing of the Paradise Papers. E.g., the Guardianreported that “Northeastern is one of 12 prominent U.S. universities and colleges named in the Paradise Papers as investors in EnCap Energy Capital Fund IX-C, a hedge fund based in the Cayman Islands. The fund acts as a feeder to a subsidiary based in Houston, Texas, of EnCap Investments, one of the world’s largest private equity companies, which describes itself as the ‘leading provider of venture capital to independent oil and gas companies.’”

The company also has a record in New Jersey. In a 2010 report issued by In the Public Interest, Jeffrey Keefe and Janice Fine of Rutgers University said “New Jersey offers a multitude of negative examples of privatization that involving public corruption and political misallocations, including E-ZPass, EnCap, schools construction, motor vehicle inspections, tax collections, inmate health services and municipal utilities.”

30) Think Tanks: An interesting article by Australian economist and privatization critic John Quiggin on how faulty accounting in state budgets can produce a spurious case for public asset sales. “Unfortunately, the attitude that the proceeds of asset sales are ‘free money’ leads to both bad investment decisions and to a search for more and more dubious financial expedients that can be presented as financing those decisions,” Quiggin writes. “The most egregious case of this kind has been the sale of the land titles registry with the purported aim of financing stadium upgrades at Moore Park and Homebush. Both sides of these transactions are economically disastrous.”

Legislative Issues

1) National: The issue of whether or not to abolish or reform ICE is going to get its day before the U.S. House of Representatives. Republicans, believing they can put Democrats in a tight spot, plan to bring the Establishing a Humane Immigration Enforcement System Act, which Democrats plan to introduce, to the floor for a vote. “President Trump’s blanket directive to round up and target all undocumented immigrants underscores the unchecked power which ICE has used to terrorize our communities. From conducting raids at garden centers and meatpacking plants, to targeting families outside churches and schools, the President is using ICE as a mass-deportation force to rip apart the moral fabric of our nation,” said U.S. Representatives Mark Pocan (D-WI). “Sadly, President Trump has so misused ICE that the agency can no longer accomplish its goals effectively. As a result, the best path forward is this legislation, which would end ICE and transfer its critical functions to other executive agencies.”

For further discussion see Julianne Hing, “What Does It Mean to Abolish ICE? Activists and politicians want a total overhaul of immigration enforcement—but do we have a real plan?” Azadeh Shahshahani, policy and legal director at Project South, an Atlanta-based immigrant-rights organizing and advocacy group, told Hing “immigration detention—this idea that people need to be held in cages—needs to be eliminated. And the racism and xenophobia that have enabled the expansion of this agency and the private prison industry must be addressed. Congress should dismantle ICE’s detention-bed quota, shut down detention centers, drastically cut ICE’s budget, and repeal draconian laws that criminalize immigrants.” Gillibrand, Warren, Pocan, and de Blasio have as yet not called for this.

2) National: Sen. Bernie Sanders (I-VT) was the only Senate Veterans’ Affairs Committee vote against advancing the nomination of  Robert Wilkie to be Trump’s VA Secretary. “This has less to do with Mr. Wilkie than President Trump,” Sanders said following the vote. “Trump has been very clear about his desire to move to the privatization of the VA, and I suspect any of his appointees will try and move the agency in that direction.”

3) National: The National Conference of State Legislatures (NCSL) will be holding its Legislative Summit in Los Angeles from July 30-August 2.

4) Arizona: Public interest advocates are highlighting the unaccountability of charter schools compared to traditional public schools when it come to financial oversight. “It’s a rip-off and a scam and the Republicans who control the Legislature allow it to go on. They refuse to enact the same kind of transparency and accountability rules for charters that are imposed on other public schools. In its report on the financial shenanigans allowed to go on within charter schoolsthe Grand Canyon Institute pointed to things like a lack of competitive bidding, which allows self-serving charter holders to enrich themselves and their relatives on the taxpayer dime.”

5) North Carolina: Another review of the state’s school voucher evaluation methodologyhas emerged, and it’s sharply negative. “North Carolina General Assembly lawmakers are about to conclude yet another legislative session without implementing meaningful evaluation and accountability measures on state voucher programs. Despite the N.C. State report, unfettered expansion of vouchers continues, and policymakers, educators, and parents still don’t know whether the program is working or not.”

 

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