is when private corrections will go away. Face it, even the mismanagement of Doc did not kill it (although it did make it limp for awhile). This industry has good management and bad management (like all industries). Even the bad management seem to survive, and the good management will thrive.
Why....its because the fundamentals of private corrections will always be strong, and the inmates sure aren't going away. This business will not go away, and when the "Doc's" are gone, we will be able to return our focus to the strong fundamentals of private corrections.
Will come in the Federal Court system, Thats where in the end, it will be decided wheather or not private companies has the right to house, discipline, and be responsible for treatment of the prisnors. My opinion, privatlization will loose. That decision is not far away from being ruled on at thiis time.... Smiles :)
privatization. If you go back 5 to 10 years, you will always see a union-sponsored effort to get the Federal courts to ban privatization. It has NEVER even gotten out of the starting blocks because the economics of privatization (whether it's corrections, or another industry) will always drive the decisions. To make it even stronger, the privates have proven they can do as good or better a job at the service (sure you read about problems in the papers, but the private companies still have less problems than the public system -- it' sjust easier for the NY Times to print about privates.
In addition, there has been several publications from the Federal system themselves over the past 9 months that specifically states the Fed's will utilize the privates to solve/deal with the current and projected ever increasing overcrowding problems. These are not my words, but the Federal system itself.
You will always see opponents to this industry, but the industry will continue to grow because the fundamentals and economics of privatization will always carry the day.
We just need for PZN to clean up it's corporate act. But don't overlook other good player(s) in this business. They should all be good stock appriciating investments at these levels.
To keep things in perspective, remember that in 1979, the numbers in state and federal prisons totaled about 400,000. Today, it is about 2 million, including jail populations. A total of 5 million either incarcerated or under some sort of court supervision (parole, probation, home detention, etc.) So it has not always been this way, the demand was a function of "getting tough on crime." In other countries, it varies greatly. I had a colleague visit a prison in a European country, and he couldn't believe it was a prison -- more like a hotel with guards. So we may see more prisoners as society gropes for a solution to crime and violence, or less as society and policies change. Right now, things are stretched to the max, but don't take anything for granted over the long term.