Earlier today, the American Federation of Teachers (AFT) released a report “Private Prisons and Investment Risks, Part Two: How Private Prison Companies Fuel Mass Incarceration—and How Public Pension Funds Are at Risk,” which looks at investment risk for pension funds of investments in privatized prison and detention companies.
The AFT represents 1.7 million members participating in pension funds with an estimated $3 trillion under management.
With the support of the Private Equity Stakeholder Project, the report features a “watch list” of the private equity firms that own for-profit companies that provide services to detention facilities. And it reveals how pension funds may be backing companies that put public employees out of a job by funding firms that benefit from privatization. Private equity firms have significant investments in for-profit corrections companies, and many retirees are exposed through these funds or via direct shareholdings.
“This is, first and foremost, a humanitarian and civil rights issue,” said AFT President Randi Weingarten. “But it is also a financial issue that brings the misaligned incentives of our justice system into stark relief. Private prisons and private equity firms that invest in corrections companies are profiting from jailing people—disproportionately people of color—and are a major contributor to the United States’ world-leading incarceration rate.
The Private Equity Stakeholder Project’s fact sheet on private equity investments in prison and detention amerservice companies is here.