Private prisons exist in the Netherlands, but they are not allowed to make a profit. How and why do they exist?
In: Economics
Non-profit is not the same as unprofitable.
A non-profit organisation is one which is expressly set up such that any surplus made is ploughed back into the organisation. It’s essentially the business model of every charity that exists.
The only difference between a non-profit endeavour and a capitalist endeavour is that in the capitalist endeavour, money gets withdrawn from the business into the bank accounts of the shareholders. In a non-profit, that same money goes back into improving the business.
So in the case of a non-profit private prison, instead of relentlessly trying to drive down costs (e.g. by reducing the quality of prisoners’ food) so as to boost shareholders’ profits, the emphasis will be on using any surplus money to restock the prison library, add extra educational classes for the prisoners, and so on.
As to why such a thing exists? Presumably there are people out there who believe that the rehabilitation and welfare of prisoners is important, and this is how they are trying to achieve that goal.
Latest Answers