The Real Cost of Prison in the U.S.: Ten times More Than Reported!

real costs of prisons

(Published on Huffington Post)

More than $90 billion is spent annually on incarcerating the 2.2 million prisoners in the U.S., according to recent reports from the Vera Institute of Justice. While that number may sound extreme, it is only a drop in the barrel-sized bucket of the actual economic burden on Americans. 

Knowing the current cost of incarceration is critical for lawmakers in determining criminal justice policy. Therefore, it is vital to consider what is actually spent on corrections in this country, apart from just the typical weighing of the cold state budgets.

Total cost of incarceration figures traditionally include what local state government spends in support of the prison system. These expenditures are comprised of operational costs of the prison for the housing of prisoners and those waiting trial, administrative and employee expenses, legal expenses associated with defending themselves from inmate lawsuits, and inmate services.

These correction's expenditures vary wildly. For instance, while it will cost the state of Alabama $17,000 annually to incarcerate each inmate, the state of Vermont will spend over $47,000 per prisoner each year. Even states with similar prison populations will be far apart on their per-inmate costs. California, by way of example, with a prison population of roughly 135,000, spends over $47,000 per inmate, while Texas, which houses about 170,000 prisoners, only spends $22,000 per prisoner each year. 

While it is unclear why such a disparity exists in the by-state costs of incarceration, what is clear is that even the most expensive per-prisoner states fail to truly account for what is actually spent on incarcerating each prisoner. A growing body of research has suggested that the true cost of incarceration far exceeds the amount spent on corrections. One such study, published this year in the Journal of the Concordance Institute for Advancing Social Justice, demonstrates the true annual economic burden of incarceration by estimating what may be the most important, yet always ignored, associated expense -- the social cost. 

"For every dollar in corrections costs," the Concordance Institute study conservatively estimates, "incarceration generates an additional ten dollars in social costs." That means that if the reported costs of incarceration in the U.S. are more than $90 billion each year, the actual cost may be closer to $1 trillion dollars! The study lays out twenty-two costs, only one of which is the reported corrections spending budget of $90+ billion, to show what the overall effect is on the cost to our society. These costs tend to be those borne by the incarcerated persons themselves and the burdens which are suffered by their families, children, and communities. 

A prisoner cannot earn a regular wage while behind bars. Annual earnings in the U.S., according to the U.S. Department of Labor, currently hover around $40,000 per person. But since most of the incarcerated are comprised of those who have less than a high school education, it is estimated that the average incarcerated person is missing out on an annual wage of roughly $23,000 while they are inside. This equates to lost productivity of each prisoner, which the study estimates generates a total cost of $70.5 billion annually.

Further, once a prisoner is released, their ability to earn has been greatly diminished. "Formerly incarcerated persons earn lower wages," according the study, "because they face occupational restrictions, encounter discrimination in the hiring process, and have weaker social networks and less human capital due to their incarceration." According to the Pew Charitable Trusts, incarceration reduces a person's lifetime earnings by ten to forty percent. Assuming a midpoint of 25 percent, this means that lifetime earnings for all ex-offenders are reduced to the tune of $280 million annually.

Additional costs as a result of injuries and higher mortality rates for the incarcerated equate to still further costs to the overall earning potential of those incarcerated. All told, it is estimated that through losses associated with prisoners, the cost of prisons has suddenly balooned from $90+ million to nearly a half billion dollars.

Many, however, perhaps understandably, follow the you-made-your-bed philosophy when it comes to future considerations regarding prisoners who have sinned against society. Maybe the cost to prisoners should not factor into the overall costs of incarceration in this country. But what about the cost to the innocents, the children of the incarcerated, their families, and the communities from which they come?

Half of incarcerated individuals contributed at least half of their families' income prior to the start of their prison life, according to a recent report from the Ella Baker Center. Leaving such a hole in the household income can be exceptionally rough on the families left behind. The financial situation can be so dire, in fact, that some children are forced to prematurely jump into the role of wage-earner, with their education taking a back seat. 

This adds a tremendous cost on society. Even though these children are making money, the lack of investment into a proper education limits their overall lifetime earnings. Staying in school does not do much to salvage this, since they are far less likely to be able to afford more than the minimal schooling. College becomes out of reach. Most are fortunate to make it all the way through high school. It is therefore estimated that the impact of incarceration on the children of prisoners costs $30 billion dollars per year, with an additional $5 billion going towards related child welfare costs.

What's more, reports the California Research Bureau, because of these sorts of disadvantages, children of the incarcerated are five times more likely to end up in prison themselves. This has an obvious ripple effect on the cost of incarceration in this country, which is estimated to cost over $130 billion annually.

Add to that a wide variety of costs directly linked to incarceration that families must bear, many that no one else experiences unless they have an incarcerated loved one. Common amongst all families of incarcerated prisoners include increased debt as a result of high prison phone rates and other costs ($5 billion annually), added expenses associated with traveling to visit loved ones in prison (nearly $1 billion annually), adverse health effects due to heightened stress ($10.2 billion annually), moving costs to be closer to imprisoned loved ones to minimize visitation and phone costs ($0.5 billion annually), and higher divorce rate ($17.7 billion annually), to name just a few. 

While the cost to state government may only (only?) add up to $90 billion each year on paper, the real cost to the nation is much higher. The overall burden to the nation is estimated at $1 trillion, or roughly the gross domestic product (GDP) of Australia (or 6% of U.S. GDP) -- an amount of lost resources that if used more appropriately could have a dramatically positive impact on our society.

Even if you choose to ignore the cost to prisoners, there is still an appalling cost borne by the families, children, and communities, all innocent people victimized by the mistakes of the ones they love and the incarceration policies that punish them. To narrowly focus on what a state spends on corrections is to wear blinders to the greater issues of incarceration in this country.

Lawmakers and the ones planning the correction's budgets are beginning to recognize the problems with the mass imprisonment of its citizens and the policies that have driven it. If they would likewise acknowledge the real cost of prisons, perhaps they would more quickly make the reforms necessary to limit its use and take America off the top of list as the most prolific incarcerator in the world. Until then, it'll cost us all.

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