Thursday, August 02, 2012


Obviously, all decent and right-thinking people hate government, right? So now we're trying this:
Goldman to Invest in City Jail Program, Profiting if Recidivism Falls Sharply

New York City, embracing an experimental mechanism for financing social services that has excited and worried government reformers around the world, will allow Goldman Sachs to invest nearly $10 million in a jail program, with the pledge that the financial services giant would profit if the program succeeded in significantly reducing recidivism rates.

The city will be the first in the United States to test "social impact bonds," also called pay-for-success bonds, which are an effort to find new ways to finance initiatives that might save governments money over the long term.

... Mayor Michael R. Bloomberg plans to announce on Thursday that Goldman Sachs will provide a $9.6 million loan to pay for a new four-year program intended to reduce the rate at which adolescent men incarcerated at Rikers Island reoffend after their release.

...The Goldman money will be used to pay MDRC, a social services provider, to design and oversee the program. If the program reduces recidivism by 10 percent, Goldman would be repaid the full $9.6 million; if recidivism drops more, Goldman could make as much as $2.1 million in profit; if recidivism does not drop by at least 10 percent, Goldman would lose as much as $2.4 million....
I'll go for the obvious joke: Hey, if you're looking for expertise in staying out of jail, you probably can't beat the people at Goldman. (Though really, what's the plan for keeping these offenders from going back to prison? Millions of dollars in lobbying? I don't think so.)

Governments elsewhere are trying this approach, though so far only Bloomberg is using Goldman. Here's what another government official says:
In Massachusetts, Jay Gonzalez, the secretary of administration and finance, is a proponent of social impact bonds. "We've got to change from the idea of, 'We just pay for stuff and hopefully get the results,'" Mr. Gonzalez said in an interview. "The beauty of this is if they perform to get the results, then we pay. If they don't, we don’t pay."
In New York, though, does anyone think it's even theoretically possible that Goldman won't be paid? Does anyone think it's even theoretically possible that Goldman won't find a way to make the numbers add up so Goldman wins, even if New York's crime rate begins to approach that of Sinaloa?

Wait, I take that back. I can see a scenario under which Goldman might admit its program failed -- it could happen if Goldman has created another financial instrument that gives the firm a bet against its own recidivism program. Can't you see that happening? Goldman hedges on its own social do-gooder program, so it wins if the criminals stay clean and it wins if they don't? Wouldn't that be just like Goldman?

(X-posted at Balloon Juice.)

1 comment:

Victor said...

Yes, sadly, it would.

And how ever, in the name of Betsy Ross, did this nation survive for 200+ years, without privatizing absolutely every feckin' thing?

Why, it's a wonder that the Doughboys in WWI weren't an infantry division from Pillsbury.

And that Hasbro didn't provide FDR with his military members, for the future naming rights of their G.I. Joe man-dolls!

And somehow, even before the prison industry started to get privatized, we Americans were pretty damn good not only at putting people in prisons, but in keeping them there.
And then we started "The War on Drugs" to make sure that prison's ran at well above maximum capacity all of the time - after all, those shiftless, lazy dark people should be thankful for the "Three hot's and a cot" that the government was willing to provide for them, even if the "hot's" weren't really hot, but lukewarm and sh*tty, and the cot was in the same cell as a murderer in for life.

And that to help with recidivism, so that if/when they served their time and were released, prisons used to provide some levels of education for the people incarcerated in them, so that they might not resort to the very behaviors and actions that got them there in the first place.

I know.
For 3 years, through the college I was a student at, I taught in a Maximum Security Prison for 3 1/2 years, until Reagan came along, and the program was "executed."

And now, we're going to an investment help us with recidivism?

Sh*t, those motherfecker's at GS's would make a whole lot more money if, instead of concentrating on recidivism, they taught criminals how to be successful "investors" like them, for a piece of their future earnings!
Who know better how to steal lots and lots of money without ending up in prison, than "financial services people?"

Every day, there's some new atrocity from the right.

Maybe if I failed at a suicide attempt, but did enough brain damage, I could become a Conservative, think these were all great idea's, and better appreciate feckin'-up this nation and its people.