It is a peculiarity of the United States that many of the nation’s prisons have long been more or less self-sufficient. This tradition of self-sufficiency began in the Southern part of the United States throughout the late 1800s and the 20th century. Prisons, often extremely strapped for cash, ended up finding creative means of raising the revenues that they needed to survive. This often involved such things as leasing out convicts for day labor on various projects, including public works projects, as well as allowing the inmates to run prison farms, livestock operations and other means of providing food, clothing and other basic necessities to the prison itself.
It is no surprise, based on this context, that today’s modern prisons often still feel strong pressures to become self-reliant in economic terms. All too often, state and local budgets simply do not have the extra cash to hand out to prisons. This leads to overcrowding, particularly exacerbated in such areas as California, where the inmate population has exploded over the last 20 to 30 years.
One of the ways in which prisons have begun to solve the self-sufficiency issue in the modern context is through the use of commissions being paid on outgoing phone calls. Prisoners making phone calls are a major source of revenues for almost all prisons in the United States today, with the total estimated volume of inmate calls exceeding $1 billion annually. Companies such as Securus Technologies, the leading inmate communications provider in the United States, are able to operate based on contracts that are awarded according to the company’s ability to pay back commissions to the institution in which it is allowed to operate.
Under this system, Securus has paid out hundreds of millions of dollars annually to the prisons in which it is allowed to operate. This has created tremendous value for the prisons where Securus run to the phones.