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Saturday, July 20, 2024

UC directly divests $25 million from two private prison corporations


Divestment follows recent criticism from Afrikan Black Coalition, Black Student Unions

On Dec. 31, the University of California (UC) finished selling the remaining $2 million of its direct investments in private prison corporations. This concludes the university’s most recent divestment from the GEO Group and the Corrections Corporation of America (CCA), two major for-profit businesses responsible for funding and maintaining American prisons.

The divestment was formally announced on Dec. 18 through a press release published by the Afrikan Black Coalition (ABC), one of the major student-led efforts responsible for the divestment.

Titled “Afrikan Black Coalition Accomplishes UC Prison Divestment!”, the press release stated that UC Chief Investment Officer Jagdeep Singh Bachher met with members of ABC privately to announce the UC’s decision to sell $25 million worth of investments in private prison corporations. From Dec. 18 to 30, UC sold $23 million of their investments, with the remaining $2 million sold on Dec. 31.

Rebecca Trounson, the UC Office of the President’s media specialist, explained in further detail over email the reasoning behind the recent decision.

“From a risk perspective, this made sense given our conclusion that, based on risk over the next several years, these holdings were not a good investment for a long-term investor such as UC,” Trounson said.

Trounson went on to define what the UC considers to be a risk.

“Many factors figure into this [risk] perspective, such as whether social, governance or environmental issues make an asset too risky over the long term,” Trounson said.

For ABC, the UC’s decision should not just be from a matter of risk. Rather, ABC believes that it should be from the fact that the investments completely go against the UC’s mission of public service. In their article “UNIVERSITY OF CALIFORNIA HAS MILLIONS INVESTED IN PRIVATE PRISONS,” ABC specifies this alleged hypocrisy.

“The message is clear: the bodies of the Black, brown and immigrant folks who pack these private prisons are disposable tools of labor and the UC underwrites this message with their financial investment in its maintenance,” the article stated.

While ABC argues that private prison corporations are responsible for taking advantage of minorities for the sake of profit, these corporations continue to stand firm in their practices.

Pablo Paez, GEO Group’s vice president of corporate relations, stated that this negative idea behind private prison corporations is inaccurate. In a statement found in the Los Angeles Times, Paez addresses the perception of companies like GEO Group.

“These attacks […] rely on politically motivated sources to advance the inaccurate notion that private prisons are somehow unaccountable,” Paez told the Times. ”Our facilities adhere to strict contractual requirements and standards set by state and federal governments.”

Jonathan Burns, a spokesman for the CCA, made a similar comment. Published in a Reuters article, Burns, like Paez, believes that there is a distorted view of private prison corporations.

“Frankly, we’re delighted to have a greater share of investors who are thoughtful about our business, can tell the difference between rhetoric and reality and agree that the free market is a great creator of innovation and economic opportunity,” Burns told Reuters.

The UC is the country’s first public educational institution and second educational institution in the nation to divest from private prisons. However, according to ABC, the UC’s divestment is not complete. ABC continues to criticize the UC for investing in corporations that also invest in private prisons, such as Wells Fargo.

According to ABC, the UC has invested $425 million in Wells Fargo. In ABC’s press release, the organization cites the relationship Wells Fargo has with CCA and Geo Group.

“Wells Fargo also acts as a syndication agent and issuing lender on CCA’s $900 million line of credit, serves as a trustee to GEO Group’s $300 million corporate debt and is a Million Shares Club member,” the press release stated.

The UC’s divestment from Wells Fargo is one of the seven remaining demands left in ABC’s formal Prison Divestment Resolution, a resolution unanimously voted on by Black Students Unions (BSU) from various UCs.

For Kennedy Simon, chair of UC Davis’ BSU, in order for the remaining demands to be met there needs to be greater conversation between administrators from each UC and concerned students.

“What I want to do, as far as my campus, is to push [UC Davis’] administration in talking more for us because at some point we do need administration to step in,” Simon said.

Written by: KATRINA MANRIQUE – campus@theaggie.org


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