Is the prison industry recession-proof?
It has traditionally been recession-proof, until recently when it became an industry. There’s an extra little turn of the screw for the private industry. If prison populations begin to peak, and I think they are — New York state is seeing its first drop in 27 years — then you’re going to see Department of Corrections administrators cutting contracts with the private companies. You’re going to see private prison companies hurting worse than they are now. But what happens when prisons go out of business? Great question. There’s been some concern in several states, Wisconsin being one, where legislators have raised that kind of question. CCA’s stock bottomed out at about 18 cents a share, which is just about as close as you can get to falling off the board without doing it. And these guys have inmates. If they go out of business, what happens? Do they just open the door and send the inmates home? Do we need to make contingency plans? A number of states are beginning to ask these questio
