Sad: The Prison Telephone Industry Can't Extort People as Much Now

The prison telephone industry is right up there with... well, the private prison industry, when it comes to the most repugnant manifestations of capitalism. The good news is, the industry is currently getting screwed by government regulation. Government regulation works!

For a long time, the handful of companies that controlled telephone calls from prisons were able to freely charge extortionate rates. They had, pardon me, a captive audience. The companies charged up to $20 for a 15-minute call. The prisoners and their families had to pay, or not talk. The phone companies kicked back part of the money to the prisons. It was an easy way to soak incarcerated people and their loved ones.

The ACLU, among others, pushed hard for regulations of these phone companies. And they finally got it last year, when the FCC agreed to rules that would cap the price of 15-minute calls at $3.75. Now, the Wall Street Journal reports, the largest prison phone company, GTL, is being put up for sale by the private equity firm that owns it, American Securities. The PE firm has already pulled an enormous amount of debt out of GTL to line its own pockets. But one can hope that the sale of the company now will not go well, given the greatly reduced opportunities for extortion of its target audience.

Whether or not you believe in notions of universal law or divine justice, I think we can all agree that the financiers involved in this industry must have earned some of the very worst karma in all of the United States of America. American Securities states in its list of corporate values: "We hope to make the world a better place by giving back to the communities in which we live and work." Enjoy the usurious profits that you charged to poor families whose loved ones are in prison, GTL and American Securities. You truly are among the blessed of the earth.

[Photo: AP]