There's Prison Labor In America, Too

For nearly a year, the Bush Administration has mounted a campaign against imports made in Chinese prisons. But few people seem to realize that in the past decade, a small but rapidly growing private-sector prison labor force has emerged in 21 U.S. states.

Although there are clear differences between Chinese and U.S. prison labor, the parallels can't be dismissed out of hand. China's millions of toiling inmates dwarf the 5,000 or so prisoners who work for private companies here, according to Criminal Justice Associates, a nonprofit research group in Philadelphia. But both countries argue that putting prisoners to work prepares them for civilian life and that inmates should help pay for prison costs. More important, U.S. companies and Chinese exporters share a primary advantage of prison labor: low wages. And since U.S. law bans only imports of prison goods, some companies export them just as China does.

NO COERCION. The main differences--and they're significant ones--between the U.S. and China are that China's population behind bars includes political prisoners and that inmates are forced to work. "No one puts a gun to your head here to make you work," says Criminal Justice Associates President George Sexton. However, even that distinction may be eroding. Recently, New York has begun to put inmates in solitary confinement for 23 hours a day if they refuse work assignments. Although prison experts say other states are moving in the same direction, no one appears to be using such coercion with prisoners who work for private companies.

Prison factories have existed in the U.S. since the early 1800s. They boomed in the 1870s but were almost completely outlawed during the Depression, when companies and unions protested the cut-rate competition. But Congress never banned prison products such as license plates and furniture that are sold to federal, state, and municipal agencies. Today, some 65,000 inmates make such goods, earning 20c to 90c an hour, according to prison officials.

Some states began to experiment with private-sector prison work again in the 1970s. The idea spread after Congress passed a law in 1979 allowing goods made in state prisons to be sold across state lines. States now are stepping up their interest as prison costs rise. California, which has one of the most ambitious programs, began using youthful offenders in 1986 to take reservations for Trans World Airlines Inc. In 1990, voters authorized private prison work for adults. Several companies, including a telephone answering service, already have set up shop in California prisons, and officials hope eventually to have 5,000 of the state's 102,000 prisoners on private payrolls.

In attacking such programs, rival companies echo a complaint that the Administration makes about the Chinese: Prison factories can use cheap labor to undercut competitors. Prison officials argue that they encourage work that otherwise would go overseas and that the 1979 law requires them to pay the prevailing wage. But that's not always true.

GREAT DEAL. Take Exmark Corp., a small packaging company headquartered inside a prison in Monroe, Wash. Exmark employs about 85 inmates to wrap software and other items for companies such as Microsoft Corp. and Nintendo Co. It pays the minimum wage of $4.25 an hour but no medical benefits and only $1 a year in rent. Despite the inefficiencies of working in prison, the deal is so good that Exmark just contracted for a second workshop that will employ up to 50 more inmates.

That angers Chuck Egner, the president of PAC Services, a packaging company in Redmond, Wash. He pays an average of $6.50 an hour, $1 more in health benefits, and unsubsidized rent. Exmark "can always be 30% under us, and our tax dollars support that darn prison up there," fumes Egner.

Cheap prison labor also helps some companies to compete overseas. Nyman Marine Corp. employs about 13 Monroe inmates to make boat lifts, used to moor pleasure boats. The company, whose sales soared 240% in 1991, exports to Denmark, Holland, and France.

Unions don't like prison work, either, particularly if it takes away jobs from workers on the outside. In Ohio, a Japanese-owned company called Weastec Inc. contracted with a state prison in 1989 to employ about 60 inmates to assemble wiper and lighting switches for Honda Accords built in Marysville, Ohio. But the issue has provoked such a political outcry, including a state assembly bill to outlaw all private prison work, that Weastec plans to shift the work to a nearby out-of-prison plant. "The pioneers catch all the arrows," says Weastec plant manager Les Bloedel, who ar

gues that prison labor has allowed Weastec to bring related jobs to Ohio.

Because U.S. inmates have few other options, many are willing to work for wages lower than they would get on the outside. Still, pay is an issue. Just ask Grady Mitchell, a murderer doing life in Monroe. Mitchell, who makes Eddie Bauer Inc. and other clothing for a garment maker called Redwood Outdoors, earns a piece rate pegged to the $4.25-an-hour minimum wage. He pays federal income taxes, plus 15% that the state deducts to help cover the $23,000-a-year average incarceration cost. It deducts 5% more for "victim restitution," although the money goes into the state's general fund. "I don't think it's fair," says Mitchell. "It's very unclear where that money is going."

China's treatment of prisoners may be objectionable on humanitarian grounds, particularly since political prisoners are jailed. But those who criticize its prison labor per se might be missing what happens in their own country.

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