[nrb]

The issue isn't that the company is private, the issue is with the fact it's a for-profit entity. This leads to a host of perverse incentives such as providing the lowest possible level of care for the most money possible and a lack of effort put into curbing recidivism (repeat business!!).

There are juvenile facilities that are run by non-profits and they exhibit lower rates of recidivism with a cost far lower than public prisons still.

[Prophasi]

Those incentives are often there when a private company and the government make a deal.

It's certainly not a problem with for-profit entities in general, though: Apple and Ford and IKEA and every other private manufacturer has those same incentives -- decrease cost and quality and increase price, with a corresponding interest in recidivism.

Obviously in government scenarios -- defense contracting, roads, schools, prisons, utilities -- local or regional (or temporal) monopolies suppress the competition that keeps other companies' base desires in check on the open market.

There are a lot of pressures to the contrary and obvious reasons it's the initial path of least resistance to grant such monopolies, but I wonder if there's a better way to structure deals like these to encourage competition at the same time.