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Most prisons are operated by government agencies. However, some private companies have seen the potential for profit in owning and operating private prison facilities under contract to local governments.

In the United States, private prisons are given a certain amount of money for each prisoner, usually the same amount it would cost the state to house a prisoner in a state-run facility. This saves the states money because they do not have to build the facility or hire the guards.

The private prison industry is controversial. To provide prison services and make a profit, the private prisons find programs to cut. These can include medical programs, training programs for correctional officers, food quality, and so on. Many have argued that the cuts in these programs are inhumane. Some have correlated the rise in prison violence, escapes and both prisoner and guard deaths in private prisons to a lack of adequate training for the correctional officers.

The private prison industry counter-argues that excessive regulations and government inefficiency are to blame for the massive costs of public prisons, and that private entities can provide the same services at a lower cost. In some isolated cases this has been true. However, the private prison industry in America has neither been profitable nor safe.

One major private prison company is Corrections Corporation of America. Wackenhut Corrections Corporation continues to operate under another name, and is no longer associated with Wackenhut.

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• Prisons and detention centres