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Corrections Corporation of America Message Board

  • oystergrouch oystergrouch Oct 31, 2004 10:13 AM Flag

    Future of CXW

    As usual, the general's research is very thorough and I thank him for it. But, instead of restricting ourselves to looking only at price action, consider the big picture, especially demographics. Then, ask yourselves three questions.
    1. As our population continues to grow, do you think the number of criminals will increase?
    2. If you believe the criminal population will increase, then, where will the convicted people be housed?
    3. Do you believe management at CXW is doing a good job?
    IMHO the answers are obvious. CXW is a long term hold.....if ever there was one.

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • You are welcome, oystergrouch.

      << As our population continues to grow, do you think the number of criminals will increase? >>

      The growth of the population COULD become independent of an incease in the number of criminals.

      If, for example, people were living longer (decline in the deathrate) while the domestic birthrate sharply declined (it has been declining moderately up until 1996 and since then, it's been relatively static), you could see an increase in the population while the actual numbers of newborns remained static or even dropped.

      Crimes are predominantly committed by the younger demographics rather than seniors. And, as we all know, the nation is "aging" and should continue to do so for the foreseeable future.

      So an increase in the nation's population doesn't necessarily translate into an increase in the criminal-age segment of that population.

      • 3 Replies to GenJackripper
      • Interesting and perceptive comment on age related demographics. I agree with you that it is the people under 30 who commit the largest number of crimes. But, even though our population is aging, overall,........just now the echo boomers, kids and grandkids of the boomers, is the largest population segment and the largest of that segment are 25 and under. I just read that when I was studying an investment in a beer company. This age group is their target.
        Add to that, the tendency to hand out longer sentences........especially for pedophiles, and I think demand might far outpace supply for years to come. (There seems to be an INCREDIBLE number of pedophiles)
        The results of the election seem to favor a more strict penal system. We will probably get some more conservative Supreme Court judges and California would not back down at all on the 3 strikes law (much to my surprise).

      • "So an increase in the nation's population doesn't necessarily translate into an increase in the criminal-age segment of that population. "

        An examination of CXW's table of Demographic Projections in their CC of Oct. 6, 2004 shows a steady increase of 18-24 year olds from now to as far as the eye can see. This is the group that corresponds most directly with the rate of incarceration.

      • There are other factors at work here too that are only, maybe, tangentially related to population growth, such as the illegitimacy rate. I read a study years ago that said that all other things being equal, the most accurate predictor of whether you would end up in prison was whether your momma was married to your daddy when you were born.

        Last I looked, the illegitimacy rate was declining, which of course is good for society. I wish I could find the link, but I can't remember where I found it, so if someone finds some data that disproves what I'm posting, I won't argue.

        The other thing I'd pay a lot of attention to is state and federal budgets. Deficits and shortfalls force government to be innovative whether they want to be or not. The budget surpluses of the 1990's, combined with of course all the other stuff, really hurt CCA. Governments went right back to doing what they were doing, corrections-wise, before CCA (and the industry) was created.

        In fact, in Florida one county used their budget surplus to buy back a jail that CCA had built for them and was preparing to open. There was no logical reason for them to do this, no indication they would save money by doing it, but they did anyway. Why? Because they wanted to go back to the way things were.

        The one problem I see for CCA, and the industry as a whole, is that they have a reluctant customer. It's hard to grow when even your customers who like you are only using you because they absolutely have to, and as soon as they can get away from you, they will.

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