Capitalism and Prisons

Part I

All matter possesses the property of reflection, i.e., the ability to react and reconstruct itself internally under external influences. Therefore reflection must always, and can only, take place between two or more bodies interacting on one another.

For example, as a result of the chemical composition of iron, once oxygen and moisture come into contact and began exerting their influence upon it, the iron begins to chemically reconstruct itself internally by creating a coat of ferric-oxide (rust) in reaction to these external influences.

Although unlike inorganic matter which reflects the world in an unconscious and subjective way, we humans reflect the world consciously and deliberately. We have not only evolved adapting ourselves to a changing environment; we act upon it selectively and transform it to satisfy our interconnected biological and social needs. Our consciousness has developed inseparably in correspondence with the expenditure of our labor, that is, in the creation of use-values – food, shelter, clothing, etc. Through a long evolutionary process of social intercourse based upon labor, we not only continue to develop consciousness, our consciousness likewise influences the further development of our productive activity in a perpetual ascending spiral.

V.I. Lenin wrote “… man’s consciousness not only reflects the objective world, but creates it. …” Lenin was not insisting that our consciousness alone is capable of transforming material reality. He was addressing the fact that the material world is translated in our brains through our five sense organs in the shape and form of consciousness. But more specifically, Lenin was addressing that through our productive labor we transform our consciousness back into matter when we transform the world around us in the process of meeting our needs.

Inevitably these material transformations are reflected back into our brains giving shape to new ideas and ways of thinking while creating new social needs and wants in the process: The world not only transforms us as a species, we transform ourselves through our transformation of the world in a continuous interdependent struggle between our deepening consciousness (knowledge) and our production of material values.

Karl Marx pointed out something that is relevant to us as prisoners today. He said that “… the ideal is nothing else than the material world reflected by the human mind, and translated into forms of thought. …” And although our ideas – and to a greater extent our actions – do exert their influence through all of society, to fully grasp the essence of Marx’s words is to understand why distinctive ideas and practices develop in correspondence to distinct social classes, i.e., material conditions.

But of even greater significance, to understand the source and perpetuation of all class divisions in the world today, it is necessary to understand the underlying economic basis that gives rise to them – capitalist-imperialism.

In capitalist society, a culture and consciousness develops on the one hand, not only reflecting but reinforcing its dog­ eat-dog economy. Through its economic practices and further reinforced through a corporate-owned media and advertisement industry, individualism in all of its ugliest forms, is increasingly elevated to the heavens while the collective interests of society descends in mutual proportion. Through every available facet of capitalist society, we’re taught and conditioned that our social status will be determined according to our materiaI possessions.

On the other hand and in contradiction to this, yet inseparably interconnected, capitalist production simultaneously creates the material conditions, i.e., poverty, where this superficial and individualist consciousness far too often develops into “crime,” flourishing and further necessitating the existence of a prison system.

More recently capitalism’s influence on the direction and development of today’s expanding prison industrial complex is growing in momentum and affecting all of us. To thoroughly grasp the depth of capitalism’s interpenetration of the prison system, as well as its responsibility for the ongoing social inequalities in the world to­ day, a basic familiarity with the capitalist production process is necessary, particularly that aspect pertaining to surplus value.

Surplus Value: Expanded Reproduction and Profit

Friedrich Engels provided us with a definition of the bourgeoisie as, “. …A class of great capitalist who, in all developed countries, are now almost all exclusively in possession of all the means of consumption, and of the raw materials and instruments necessary for their production ….”

This is a more accurate reflection of concrete reality today than it was when he gave it. This phenomenon is no longer confined specifically to developed countries, but through the emergence and expansion of imperialism , it now applies to the world’s “underdeveloped” countries as well.

Through the bourgeoisie’s (capitalist class) ownership and monopolization of the world’s natural resources and instruments of production, the great majority of the world’s people must sell , like any other commodity, the only thing they do own so that they may in turn purchase what is necessary to sustain their lives – clothing, food, shelter, etc. And what they sell is their labor-power. The bourgeoisie purchases this labor-power from the masses, below its value for some and above its value for others – a value which Marx defined as being “. . .determined by the value of the necessaries required to produce, develop, maintain , and perpetuate the laboring power. …” Or “…the cost of producing or reproducing the laborer himself.. ..”

Within the context of a capitalist economy, the world’s population is forced into circum stances where they must work under the control and sway of the bourgeoisie. Being that the bourgeoisie purchases this labor-power, they own it and everything that is created as a resuIt of it. Furthermore, the bourgeoisie doesn’t need the use-value of these goods for their own consumption, but like fiends they crave these goods for the exchange-value they bring as commodities upon their sale, i.e., for the surplus-value it brings to them (expansion capital and profit).

For simplicity, the description given below of the extraction of surplus-value is somewhat mechanical and far from the complete yet adequate enough to serve its purpose.

Surplus-value is created through the expenditure of unpaid labor, that additional value that is created over and beyond the total amount invested in production.

Let’s say the bourgeois owners of a maquiladora invest a total $5,000 a day for the production of shoes. $1 ,000 pays for the cost of human labor-power (variable capital), and $4,000 for necessary materials (constant-capital). If it were to take five hours to produce $5,000 worth of shoes, this five hours of expended labor is what is considered “socially necessary” to sustain the workers’ lives (and their dependents) , the $1 ,000 originally invested in the variable-capital.

It is important to note, the $4,000 invested in “constant-capital” remains constant, that is, it creates no additional value but only transfers the value embodied in the various materials (machinery, cloth, electricity, oil, etc.) to the shoes being produced. It is the “variable-capital,” the expenditure of human labor in the further transformation of these materials into shoes that augments new value.

Even though the maquiladora workers may produce $5,000 worth of shoes in five hours, being that their labor-power has been purchased and is now owned and controlled by the bourgeoisie, the workers are still required to expend their labor-power for the remainder of the working day.

Let’s say twelve hours constitutes a full working day for the maquiladora workers, and if it takes five hours to produce $5,000 worth of shoes – the total amount invested – the workers are still required to expend their labor-power for an additional seven hours, the remainder of the working day. This seven hours over and beyond the five hours that are “socially necessary ” to sustain the laborers’ lives is “surplus-labor,” seven hours of unpaid labor that the bourgeoisie is appropriating in the form of surplus value upon sale of the shoes. This surplus-labor can only be transformed into surplus-value so long as the supply of shoes on the market has not exceeded the demand or the purchasing power of the working class.

The various forms in which workers are paid , be it in hourly wages, piece meal, by the day, etc. , only disguises the unpaid surplus-labor by creating a false appearance that the workers are being paid for all of their labor when in essence they are not.

Out of necessity to beat out competition in the search for profits and prevent from going under, it is the inherent nature of capitalism that is must continuously increase its extraction of surplus-value and expand, which translates into an ever increasing extraction of surplus-labor (unpaid labor), i.e., exploitation . And aside from temporarily alleviating a significant quantity of discontent within U.S. borders by exporting the bulk of its super-exploitation abroad, via imperialist expansion, it continues to accomplish this domestically and abroad in two ways. First by lengthening the total working day (absolute surplus-value). And, secondly, by reducing the “socially necessary labor time” (relative surplus-value).

Relative surplus-value itself is accomplished in two ways: by speeding up production using coercive methods and introducing new technology. (Technology is good . Who owns it, how, and for what purposes it is used for, is another issue.) Secondly, by the lowering of wages. This lowering of wages below their value and prison labor is of relevance to this discussion.

As explained earlier the description given of the extraction of surplus-value is a little more extensive and fluid than as described above. Nevertheless it sufficiently serves its purpose in adequately explaining the source and perpetuation of the social inequalities, i.e., the class divisions, and the continuing need for an expanding prison system.

Prisons: The growing Influence of Profit

Despite the primary and essential function of the state as a tool of the ruling class for protecting and preserving its class interests, the opportunity for private and government run prison business to profit from an incarcerated population, has proven too overwhelming to pass up. The increasing profiteering from an incarcerated population in influencing not only the direction and development of the prisons themselves, but their expansion as well.

There are numerous prison businesses, including guards and prison bureaucrats, who have a financial interest, i.e., a class interest, in increasing the U.S. prison population.

Take for exam pie Corrections Corporation of America (C.C.A.) whose relevant industry is designing, construction, and management of private prisons. CCA began selling its stock on the market in 1995 , beginning at a little over $8 per share. By the end of 1995, one year after three strikes went into effect, it rose to over $37 per share – a 385 percent increase. In February of 1996 it had risen to over $47 a share. [Today, July 15th 2006, they are selling for $53.17 per share.]

Big capital’s involvement from the start included the imperialist multi-national corporations Bechtel and Wackenhut. CCA received venture capital from Massey Burch Investment Group, which also backed Hospital Corporation of America, the largest U.S. for-profit operator of hospitals. Even M.C.I., Print, and AT&T are raking in profits from an incarcerated population, charging up to six times the normal long distance rate.

Let us take a look at Wackenhut Corrections Corporation, whose relevant industry is jail, prisons, detention construction and management. In 1995 Wackenhut ran food service operations in about I 00 prisons. That’s when they bought Service of America’s prison food service operations. The 1996 revenue for Wackenhut Food Service division alone was expected to top $80 million. That put the company in 27 states. In 1993 their stock rose from $11.70 to $12.09 a share, up three percent. In 1995 it went from 14.75 to $17.75, up twenty percent.

As demonstrated earlier, capitalism must expand in order to beat out competition for profits. And despite the inevitable fluctuations in the stock market, these and other prison businesses must also expand in order to attract more share holders, i .e., more investment. Although this expansion can only take place in the context of an expanding prison system as well as a further penetration of the current prison system already in existence.

The interconnection between the expanding prison system and the expanding prison businesses is not one-sided or mechanical. One aspect does not exclusively determine the other. The interconnection between the aspects is dialectical , that is, it is an interpenetrating connection. Not only does an expanding prison system provide the opportunity for the penetration of capital into it, but the increasing penetration of capital into the prison system itself, in true dialectical fashion , influences the further expansion of the prison system through the private prison corporations lobbying of state legislators for more “tough on crime” laws, such as three strikes, anti-immigration reform, etc. These practices are parallel to those practices the C.C.P.O.A. uses in an attempt to further their reactionary class interests (financial/material) at the expense of our class interests (more harsh sentencing laws and incarceration via mandatory minimums, etc.).

The prison business companies are numerous and very profitable. In 1995 the listed companies had total combined assets of 5.3 billion dollars (more recent figures exist). The figures provided in the table above do not fully reflect the tightening grip that capitalism is gaining throughout the prison system. And although there are existing contradictions between private, state, and federal financial interests , such as the C.C.A. paying higher salaries to its guards in comparison to the salaries of some state guards, the primary function of the state as a means of social control, complemented with the opportunity for these various businesses to profit from our incarceration outweighs these lesser contradictions.

In fact state, federal, and private interests collaborate with one another on numerous levels. Here are a few examples:

1. The I.N.S. rents out bed space from private facilities. In 2006 Haliburton received a contract for $385 million to begin building facilities for ” illegal immigrants.”

2. State government is also profiting from “illegal” border crossing by building additional structures to, as well as renting out, county jail space to the I.N .S.

3.In 1995 Bill Clinton proposed to place all new minimum and low security federal prisons under private management.

4. The Bureau of Prisons has put all of its pre-release housing under private contracts.

More recently in 2006 Governor Schwarzenegger announced his “strategic growth plan” proposal to expand California prisons by 90,000 beds. In spite of the reactionary labor aristocratic C.C.P.O.A.’s uproar, Arnold intends to place 8,500 of these beds under private prison contracts.

Regardless if this particular proposal gets off the ground or not, the prison system is currently in the process of expanding at a rate of 1,000 prisoners per week nationwide, 56,000 in the last year.

Part II

Surplus Value and Prison Labor

As was demonstrated earlier, the way to extract the greatest quantity of surplus-value (profit) from the laborer is by increasing the amount of surplus-labor (unpaid labor) by way of absolute surplus-value, i.e., lengthening the working day and or lowering wages. It is this relative surplus-value that we are concerned with here, and the surplus-value that prison labor creates.

In 1994 there were 1.1 million prisoners within the state and federal prisons (this number has now skyrocketed to over 2.2 million). Back then 44.6 percent of those prisoners were in work programs, with another 65,000 in work release programs. In 1995 the government run prison industries had $1 .2 billion in sales and private industries had $83 million, or 6.4 percent of the total sales. Despite the greater number in sales from government run prison industries, the private prison business in continuing to expand. Whether or not this degree of momentum has been maintained or not, in 1996 private prisons were out building state prisoners four to one, conveniently following on the heels of the implementation of three strikes.

What’s being demonstrated here is that the investment in variable capital is so low, that is, if the prison laborer is paid at all, state, federal, and private prison businesses can profit from the surplus-value prison labor creates while passing on the cost of maintaining the prisoners live (food, clothing, shelter, etc.) to other workers, domes­ tically and abroad , via taxes. According to national data in California, this cost was $22,000 (although currently higher) annually per prisoners. If the prisoner was required to cover this cost the value of a prisoner’s labor-power in California, he or she would have to work full-time at over $10 an hour. Being that more and more prisoners’ labor is being rented out for far less than that to produce goods or provide services for an outside market, what this amounts to is a state subsidy for the companies who use prison labor.

State-run prisons are not required to pay their prisoners for their labor-power, although when they are rented out to private companies they are required to receive a minimum wage. These same state facilities who rent out prisoners to private companies turn around and dock up to 80 percent of this wage for cost of living, restitution, etc., and in some cases these companies pay and extra ten percent to the state (kick-back) for the use of this cheap labor.

Since these companies would have to pay higher wages to workers outside of prisons in order to compete with the labor market, this creates a financial interest for these companies to have greater access to cheap prison labor. The Department of Corrections also has a financial interest in the creation of a defeated prison population, i .e., a reliable labor force who that is not always on lock down-hence “additional incentive” for the further expansion of control units and repressive policies designed to destroy prisoner unity between groups and within the groups themselves. California’s validation policy being a prime example. Again, prison labor for profit is not the prime motive for these policies, but is an intricate part adding fuel to them.

For those of us incarcerated within state and federal prisons know that most yards have some sort of prison industry where prisoners work producing some sort of goods or providing some sort of service destined for the market. Being that state and federal prisoners are often paid only a matter of cents for their labor power (variable-capital), whether it be in several cents an hour or several cents a day, this relative surplus value, paying of wages far below market value, increased surplus labor (un­ paid labor) tremendously, resulting in a high profit. This shouldn’t be misinterpreted as prisons themselves are far from profitable, although there are many who profit tremendously from the prison business.

Providing a federal and state example, let’s first look at the federal prison industry’s UNICOR, whose prison labor produces furniture, metal products such as stainless steel food equipment and shelving, electronics, signs, and decals, envelopes and letterheads, clothing and textiles. They also sell services such as data services, furniture refurnishing, laser toner cartridge remanufacturing, and more. In 1993 UNICOR had 16,000 prison labor in 89 factories with $417 in sales for 1992 alone. In 2005 that number was nearly just under 20,000 workers in 106 prison factories. UNICOR sales for 2004 were $802,720, nearly a hundred percent increase since 1993. In 2005 UNICOR workers started out at $.23 an hour.

In regards to state prison labor, Prison Blues brand jeans factory at Eastern Oregon prison is another example. The prisoners make jeans which are sold domestically and exported with sales in 1994 at 914,000.

The examples are numerous, but what’s more important at this point is establishing an accurate analysis of the direction and current development of the prison system . It is also important to observe that even though prison labor which produces goods and services for profit is fairly low in relation to the entire prison system, we should expect as the Department of Corrections continues its ongoing campaign to dismantle us, prison labor for profit is likely to continue increasing in proportion.


Abolishing the use of prison labor for profit would alleviate “some” of the incentive to expand the prison system, as would also a successful struggle in achieving a minimum wage (exempt from deductions) for all prison labor-yard crews, laundry, porters, etc. Dialectically , this would create “some” incentive to decrease incarceration in opposition to the incentive to increase it.

But of greater significance it is essential to understand that the prison system is not only a concentrated reflection of the class contradictions existing within society at large, but all prison struggles transcend their prison walls whether we are conscious of this or not.

V.I. Lenin is correct in his observation that,

“…The state is the product and the manifestation of the irreconcilability of class antagonisms. The state arises when, where, and to the extent that the class antagonisms cannot be objectively reconciled. And conversely, the existence of the state proves that the class antagonisms are irreconcilable ….”

This passage of Lenin’s is extremely relevant for us as convicts in comprehending the historical role of prisons and our objective position as convicts in a class divided society – regardless of what social position one may have occupied prior to their incarcerations. Moreover, the prison system is not only one aspect of a much larger interconnected class struggle that transcends its walls, it is part of a class struggle that transcends all national borders well.

As individuals we are not only products and reflections of society in general, we are also products and reflections of particular social classes. With simplicity, yet effectively, Mao Tse-Tung summed this up well:

“.. . In class society everyone lives as a member of a particular class, and every kind of thinking, without exception, is stamped with a brand of a class…”

Although this is only half of the truth as the inverse is also true and completes the equation. We’re not simply mirrors which passively reflect the external world around us. Through our social practice; i.e., our actions, we influence the continuous transformation of our material conditions which in turn further shapes our consciousness and practices. Therefore it is up to us to transform the economic basis that gives rise to the phenomena of class divisions and their irreconcilably opposed interests.

The concrete material reality is that we prisoners are merely one of the numerous outward manifestations of an essentially outdated and insufficient economic system that results in the social inequalities that make a prison system necessary to protect the stolen riches and privileges of a small but powerful elite and their reactionary beneficiaries – the same profit-driven economic system that oppresses and exploits Third World people around the globe. Our interests do not lie in supporting our own domestic bourgeoisie and its reactionary supporters in the imprisoning of over two million of our own population , or in the exploitation of billions of Third World people. Our interests, however overwhelming it may seem, lies with our own impoverished and Third World people against not only our own bourgeoisies and its loyal beneficiaries, but against all capitalist ruling classes of the world regardless of national boarders.

In his famous work The Origin of the Family, Private Property, and the State, Fredrich Engels said,

“…Every state … consists not merely of armed men , but of material appendages, prisons, and repressive institutions of all kinds….”

So long as we live in a society divided into social classes, the preservation and need for a prison system is guaranteed.


V.I. Lenin , “Philosophical Notebooks,” Collected Works of Lenin, Vol. 38

Das Kapital, Volume One

F. Engels, Principles of Communism

Karl Marx, Das Kapital, Volume One

first published in Prison Art Newsletter, August and September 2006

Chad LandrumChad LandrumChad Landrum

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