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Federal Prison Industries Fortunes Continue to Sink

Anyone who has been paying attention the past several months is aware that the public’s perception of the federal government’s ability to manage its affairs in an orderly fashion has been plummeting. Therefore, no one should be the slightest bit surprised that a recent government study of the Bureau of Prison’ (BOP) Federal Prison Industries, Inc.  (FPI) was highly critical of that agency.

According to that study, “FPI was established by statute and Executive 1934, provide opportunities for educational and work-related experiences to federal offenders.“ It currently has 80 factories at 65 prison facilities, and sales of $750 million. Although the program has enjoyed limited success in the past, it appears that technological advances in the private sector, as well as the general economic downturn in low-skilled, free-market manufacturing, have FPI on the ropes.

Most of FPI’s business has come from other government agencies and the military. Previous laws established, known as the “mandatory source” authority, required federal agencies to turn to FPI first to purchase needed merchandise for their agencies.  The U.S. military has in the past been FPI’s biggest customer, accounting for 48% of sales, especially in the years of the wars in Iraq and Afghanistan.  However, as those wars have ended or wound down, the military’s need for FPI products has declined from $536 million in 2007 to $357 million two years ago.

FPI also has been criticized for producing products of poor or uneven quality.  PLN has previously reported on thousands of military helmets that were rejected by the Defense Department, and FPI’s attempt to manufacture more sophisticated  consumer products have also been largely unsuccessful. Stung by criticism from their constituents that FPI was unfairly competing with low-wage prisoner labor with private businesses in their districts, Congress has severely limited FPI’s ability to undercut those businesses with prison labor.

FPI has also had personnel problems, which is hard to fathom since all of their employees are under their complete control.  An attempt to increase the percentage of prisoners employed via a job-sharing program was unsuccessful.  It was also discovered that many employees were undocumented individuals who are supposed to be ineligible for the job program.

Another problem is that the manufacturing environment in the U.S. has changed in recent times, with more factories relying upon new technology to create their products, at a cost competitive with prisoner “wages.”

Additionally, outside observers have criticized the ability of BOP employees to respond to free-market requirements regarding product quality, and pointed out that the market for the type of goods that FPI is capable of producing continues to shrink. FPI attempts to find other products to sell, such as solar panels, have also not been successful.

Others feel that one of the principal reasons that the program still exists is that it provides relatively good-paying jobs for BOP supervisors. Of course, one could make that observation about many of the jobs in BOP, which sometimes do not even require a high-school diploma or equivalency to qualify.

Prisoner rights advocates, who object to the concept of prisoners doing repetitive jobs in work environments that do not offer skills readily transferable to the private sector after they are released is merely another example of BOP exploitation.  These observers advocate instead for meaningful job training using up-to-date technology and methods, which they note is probably also beyond the ability of the BOP to institute and administer without the use of outside experts.

Sources:  “Behind prison bars, faltering factories,” New York Daily News, 2014,

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