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Oregon Prisons In Rural Oregon

Oregon Business Magazine has an excellent article on the economics of prisons in Oregon. As most people know Oregon spends more on prisons than any other State. And with to Measures on the ballot in November, we may become even further in front…..

From the article:

The national studies cite a number of problems with using prisons to boost economies. First, prisons do not pay local taxes. Second, they rarely if ever purchase goods and services locally, and while they sometimes try to hire locally, they do not always succeed because of union requirements that promotions must be based on seniority. Third, prison employees tend not to live near their place of employment, preferring to settle in outlying areas and commute. For example, 62% of the employees from the Ontario prison don’t live in Oregon but next door in Idaho, where property taxes and home prices are lower.

Then there is the matter of prison labor. In 1994, the same year Oregon voters passed Measure 11, they also approved Measure 17, which requires inmates to work a 40-hour week. As a result, Oregon prisoners work inside and outside of their facilities, cleaning parks, sorting mail, printing business cards, building cabins and making telemarketing calls for private companies, including Timeline Industries and National Marketing Solutions.

In addition to those specific shortcomings, there is the broader notion of “opportunity costs,” the cost of pursuing one choice rather than another. The idea is that operating large prisons in small, remote towns requires so much accommodation that it crowds out other opportunities that might lead to clusters of related, competing businesses propelling each other to innovate and expand. In other words, there is nothing entrepreneurial about a prison economy.

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