The American Gulag

Despite America's rising crime and the frequency of felons released only to
commit other crimes, there is a seamy underbelly to our justice system.
Namely, that people are profiting from others being incarcerated.  The more
that are incarcerated, the greater the profits.  And this is not the first
time in history such a situation has arisen...

It is building an American Gulag, one that threatens to assume the mantle
of The New Evil Empire.

The conception of an American Gulag did not start with Stalin.  It harks
back to the Nazi era.  Aside from its assault on humanity, the idea of
slave labor always has been a blunder. It will be viewed as no less a
blunder when the American Gulag finally emerges from its nightmare -- if it
ever emerges.  For now, it must be stated that our historical memories are
short, indeed.

The Gulag

By the time Josef Stalin took command of the U.S.S.R., the inner circles
knew communism to be a failure.  Aleksandr Solzhenitsyn related this
intelligence in volume two of his Gulag Archipeligo.  He also explained
that Stalin closeted himself for several days with a Turkish businessman
named Naftaly A. Frenkel, an old friend.  Frenkel reasoned, as do most
businessmen, that values and profits are predatory, always achieved at the
expense of others.  He told Stalin that in order for Communism to succeed,
it would be necessary to get free labor.  This conclusion achieved, the two
then proceeded to construct their syllogism.

Frenkel pointed out that not just any labor would do. This free labor had
to know how to do things -- and thus the judgement was made to draw up a
list of engineers.  "Now," said Frenkel, "arrest every seventh one!"  These
workers would bring their own energy into the system.  And the system would
harvest this energy, giving all those who confessed to choreographed crimes
only thin cabbage soup and minimal support for life.  Most would be dead in
a year or two.

This free labor built and staffed the Gulag.  As the Gulag expanded, coal,
minerals, gold -- especially gold -- and timber met the raw materials
requirements of what the pundits called "the future now."

There was a problem with this business equation.  It did not answer the
requirements of economics.  Because free labor was used, raw materials
failed to generate the base income that could -- via the multiplier --
hoist up the national income. As a consequence, the Soviet economy always
operated without an adequate social surplus, or a proper profit for the
system.

Cheap labor in fact sounded the death knell for communism that far back.
It was only a decade or two before the Stalin era that Henry Ford reasoned,
"If we do not raise the industrial wage to 50 cents an hour, the worker
will never be able to own a Model T car."  Accordingly, Ford took the lead
in raising the American industrial wage to 50 cents an hour. Others
accepted this reasoning and joined the effort.  On this basis the United
States built the biggest steel industry, the biggest auto industry, the
biggest just-about-everything. There were depressions called panics, and
then there came that engineered depression of the 1930's, which was crafted
by business people who wanted the disparity required by free trade.  There
were also periods of structural balance.  These were created by
stabilization measures, by raw material prices in line with wages and
capital costs, and by an understanding that free labor was a delusion of
maximum dimension because the absence of income short-circuits the exchange
equation.

Today, half the world is coming apart because the act of production is not
creating and distributing the credits needed for consumption.  It took over
seven decades for Stalin's economic error to undo communism.  And yet the
United States is following Frenkel's advice in its own dumb way.

Blunders and folly are the stuff history is made of, and there are enough
of both to bend over almost anyone except for the tragedy involved.  A case
in point.

Just 50 years ago, millions of human beings were mined for everything from
their gold wedding rings to their human flesh, which was turned into lamp
shades, after their bodies were worked to death by a slave labor system
that grew up in the middle of the greatest civilization in the history of
the human race -- in Western Europe.  How this happened will never really
be understood until we come to grips with why it is happening again today,
right here in America.

Auschwitz was a private prison.  Like many Nazi concentration camps, it
began as a detention center for prisoners of war and political opponents of
the Nazi regime. As the number of prisoners began to grow exponentially,
the camps were turned into slave labor operations, modeled on Quaker,
American Friends Service Committee-run work camps in
pre-war germany, whose philosophy was that hard work is the best
rehabilitation.

The official Nazi policy for Auschwitz and other camps, enunciated by Fritz
Saukel, who was hanged at Nurenberg as the head of the Nazi slave labor
program, was "All the inmates must be fed, sheltered, and treated in such a
way as to exploit them to the highest possible extent, at the lowest
conceivable degree of expenditure."  If this sounds like the Contract with
America, well that's the way it is.

Beginning July 6, 1940, I.G. Farben Company, the world's largest chemical
company, set up a giant factory near the Auschwitz concentration camp in
Poland.  Prison labor produced artificial rubber and oil from coal to
supply Hitler's war machine with tires and motor fuel.  Two and a half
million laborers died or were killed at Auschwitz.

But I.G. Farben wasn't just a German company.  In 1925, I.G. Farben was
merged with Rockefeller's Standard Oil Company of New Jersey.  The DuPont
company also adopted numerous cartel arrangements with the main partners.

As documented in great detail in The Unauthorized Biography of George Bush,
it was George Bush's father and the Barrimans who helped the Nazis' rise to
power.  These same interests, which are tightly allied with the British
Crown, are behind the so-called Conservative Revolution in America today.

Today, the United States leads the world -- or at least those parts of the
world that keep reliable statistics -- in the rate at which it incarcerates
its citizens. The accompanying graph, from 1992, shows that the United
States has a higher rate of incarceration per 100,000 population than even
South Africa before the end of apartheid.

In June 1994, the U.S. prison population broke through the one million
mark.  Today, nearly one and quarter million people are in our prisons and
jails.  You can see that the rate has basically grown by 6 to 8% a year
since 1980, with the two biggest growth years being 1980-81 -- Ronald
Regan's first year in office -- and 1988-89 -- George Bush's first year in
office.

The racial victims are black in the American Gulag.  And it borders, if
does not reach, genocide.



- 2 -
The Rationales

As icing on the cake, and to provide a rationale for free labor, the death
penalty became re-established, perhaps not so much to punish killers, but
to get people use to the iron-hard clout of the judiciary.

A 1993 report by the House Judiciary Committee's Subcommittee on Civil and
Constitutional Rights lists 48 known cases in which innocent people were
sentenced to death since 1973 -- and escaped execution.  Those were the
ones that we found out about before it was too late.

Dr. Death -- Jack Kevorkian -- has proposed that death row inmates donate
their organs for transplants as part of the newest form of recycling to hit
post-industrial America.  The death house, however, is mere window dressing
for the real purpose of this new Gulag.

Model Factory

The model private prison or "factory within walls" -- as Supreme Court head
Justice Earl Warren called them in 1972, after he visited Communist China
and learned how it was done -- is Federal Prison Industries, Inc., better
known by its trade name, Unicor.

There are 46 U.S. locations where Unicor operates its 97 factories,
employing over 15,000 inmates.  This is a for-profit corporation run by the
Department of Justice, with $405 million annual income.  inmates earn
minimum wage, but their average net income, after deducting room, board,
clothing, victim restitution, family support, and fines, is $1 per hour.

Established in 1934 by an act of Congress, which already aped the Nazi
model, Unicor today produces metal products, clothing, and textile
products, graphics and services, electronics, plastics, and optics.  It
produces every stick of furniture used by the government.  If it weren't
for prison labor, Newt Gingrich wouldn't have a chair to sit on!

Private prison companies, from 1983-1994 represent one of the biggest
growth industries in America.  The growth curve for the American Gulag
looks remarkably like the graph for the growth of derivatives, and not
without reason.

There are nearly 50,000 private prison beds in America as of June 1994,
most of them in Texas.  In Virginia, Governor Allen has proposed to build
10,000 new prison beds through private companies.  They're used by state
and Federal governments. The advantage is clear: Private companies don't
have to pay their guards union wages, they don't have to offer pensions,
and they can cut whatever corners they like on the prisoners.  They can
also build prisons in localities where the population opposes them as long
as there is no zoning ordinance against it.

Private Prisons

Financing for the private prisons is coming from the top levels of Wall
Street: Goldman Sachs, Prudential Insurance, Smith Barney, Shearson Lehman
and Merrill Lynch are among those competing to underwrite prison
construction with private tax-exempt bonds.  Some of the big defense
contractors, including Westinghouse, are also entering the prison business.

The way inmates are typically handled in private prisons is not what the
average American might expect.  They are degraded and often forced to
undergo intense brainwashing


- 3 -
sessions which are designed to pacify and detoxify the inmates and make
them suitable for labor.

In addition to private companies which profit from building prisons and
running them for the state or county -- charging per diem for each prisoner
they keep -- there is a booming business inside state prisons akin to what
Unicor is for federal prisons.  Here you see some examples of what is being
produced in privately-run industries inside state prisons.

California -- logos for Jerry Garcia band and Lexus autos.

Hawaii -- Macadamia nuts; Spaulding golf balls.

Maryland -- Modular houses, processed hot dogs.

New Mexico -- Hotel chain reservations.

Oregon -- Designer blue jeans called "Prison Blues."

South Carolina -- Electronic cables.

Utah -- AT&T telemarketing.  This was stopped by the
Communications Workers of America union in 1993.

Washington -- Eddie Bauer garments (for all you yuppies).

Thirty states have legalized privately-run industries in their prisons.  In
most cases, the inmates are paid minimum wage simply because the labor
unions haven't yet been totally smashed.  Like Unicor, however, the average
net income to the prisoner is a dollar an hour.

This, of course, is still significantly higher than the ten cents an hour
that prison maintenance workers routinely earn.  As a result, like the
house servants under Southern slavery, those who can get a job working in
private industry are considered the lucky ones.

The Sting

Now lets turn to the legislation that has created this potential American
Auschwitz.

A look at the effect of the so-called War on Drugs conducted by the Regan
and Bush administrations, and their counterparts in the various states,
reveals that between 1980 and 1992, convictions for drug offenses grew from
near zero to 100,000 per year.  Drug-related convictions now account for
more than 30% of all incarcerations, and, for the most part, affect only
the low-level street peddlers and users.  With mandatory sentencing laws,
the rate of incarceration zoomed from 1980, when only 19 out of 1,000 drug
convictions actually resulted in incarceration, to 1992, when the rate shot
up to 104 per 1,000.

Despite this, the drug plague continues to grow.  Maybe that's because the
institutions that profit from the drug trade are the same ones that finance
the prison-building industry.  It's also undeniably true that incarceration
breeds crime, and large-scale incarceration, as we have in America today,
breeds large-scale crime.

The newest prison-stuffing legislation is called "three strikes and you're
out."  Since the baseball teams are on strike, are Americans amusing
themselves by imprisoning their


- 4 -
fellow citizens?  As of December 31, 1994, Three Strikes legislation had
been enacted in 14 states and was pending in seven.  And these are the most
populous states.  Under this legislation, anyone convicted of three violent
felonies (two in Georgia -- Gingrich's home state) goes to prison for life.

And, finally, here are the key provisions of the Taking Back Our Streets
Act of 1995, the criminal justice part of the Contract with America.  This
list, with some exceptions, is what was passed by Congress.

1.   No parole; mandatory, lengthier sentences (actually these were passed
at a federal level in the 1980s by an earlier crowd of conservative
revolutionaries).  They are listed here because the Contract with America
wants them extended to state law.

2.   Increased funds for prison building will be made available only to
those states which eliminate parole and cut amenities for prisoners.

3.   It will no longer be unconstitutional to overcrowd prisons.  Prisoners
may only sue on the grounds that overcrowding violates their Constitutional
rights.

4.   The Effective Death Penalty bill drastically limits habeas corpus
appeals (Art. I, sect. 9 of the U.S. Constitution) and reduces jury
discretion in giving the death penalty.

5.   The Exclusionary Rule, which precludes illegally obtained evidence
from being introduced at trial, will be eliminated.

6.   Felons will be forced to make full restitution to victims, despite
their personal circumstances.

The Gingrich/Gramm/Armey consortium has taken out a Contract on America
that will guarantee a ready source of profit and slave labor for their pals
on Wall Street.  The only thing that is needed now, to make this potential
Auschwitz into the real thing, is what led to it the last time -- a global
financial collapse and a population tolerant of fascism.  Judge
for yourself how far we are from that.

That the above could be unfolding without a totally corrupt judiciary is a
delusion of the simple minded.  As View from the Country, in this issue,
explains, there is no Bill of Rights, and very little Constitution.  The
"despotic branch" has the nation functioning under a new type of judicial
tyranny.  This erosion of the great society could still be stopped -- if
Congress has the sand to act.

Joe Stalin tried to rescue a failing economy with free labor.  Now the
United States is trying to rescue a failing economy with cheap labor --
either dollar an hour prison labor or equally cheap foreign labor.  Before
this blunder is laid to rest, there will be sorrow no tears can symbolize.

===

This report was prepared by Charles Walters.  Additional
material was provided by Fred Huenefeld and Mary Anne Wertz.

END-ARTICLE






- 5 -
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end


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