America has been getting tougher on lawbreakers. This issomething that the public long has been demanding. The problem itcreates however is a shortage of prison capacity to hold theincreased numbers of convicted criminals. This has led to: prisonovercrowding sometimes prompting court actions against penalsystems; rapidly rising operational outlays; and taxpayerresistance to the cost of new prisons. A partial answer to theproblems of prison overcrowding and high costs may be theprivatization of prisons. Costs and overcrowding problems are thedriving force behind the privatization phenomenon. As a nationalaverage it costs roughly $20000 per year to keep an inmate inprison. There are approximately 650000 inmates in state and localprisons. This costs taxpayers an estimated $18 billion each year.More than two thirds of the states are facing serious overcrowdingproblems and many are operating at least 50 percent overcapacity.