Theorizing financial extraction: The curious case of telephone profits in the Los Angeles county jails
| DOI | 10.1177/1462474520941929 |
| Published date | 01 January 2021 |
| Author | Armando Lara-Millan |
| Date | 01 January 2021 |
| Subject Matter | Articles |
Article
Theorizing financial
extraction: The curious
case of telephone profits
in the Los Angeles
county jails
Armando Lara-Millan
UC Berkeley, USA
Abstract
Existing models of financial extraction in the criminal justice system are applied to the
case of profitable telephone contracts in the Los Angeles County jails during the mid-
1990s. The case exemplifies instances of a “punishment” model of monetary sanctions,
in which profits are derived for crime control purposes, and a “predation” model, in
which inmates are seen as potential resources to absolve fiscal crisis and create market
opportunities. However, the case contains an additional element: legal demand con-
cerning inmates’ mental health care treatment. It is shown that telephone profits in jails
could not have been used for predation or punishment purposes without the exploi-
tation of legal ambiguity around inmate’s healthcare. Broader implications for the study
of financial extraction as a constitutive theory – one that is both historical causal
explanation and generalizable description – are drawn.
Keywords
carceral state, financial extraction, jails, law, legal financial obligations
Because of the work of Harris (2016) and Harris et al. (2011) we know much about
the use and impact of court fines and fees or what they call “legal financial
obligations.” Courts charge fees for public defenders and levy other processing
charges that if left unpaid accumulate interest and surcharge penalties.
Corresponding author:
Armando Lara-Millan, Department of Sociology, UC Berkeley, Berkeley, CA 94720, USA.
Email: armando@berkeley.edu
Punishment & Society
2021, Vol. 23(1) 107–126
!The Author(s) 2020
Article reuse guidelines:
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DOI: 10.1177/1462474520941929
journals.sagepub.com/home/pun
For individuals lacking financial resources, debts related to these charges can
follow them for the rest of their lives, subjecting them to court summonses, war-
rants, and jail stays. These types of financial obligations have been shown to be an
insidious feature of the criminal justice system, working to deepen social stratifi-
cation. Page and Soss (2017) and Page et al. (2019) link this analysis to a broader
category of the criminal justice system that we can call “financial extraction,”
which includes fine-centered policing, bail systems, prison charges, civil asset for-
feiture, and other practices of using criminal justice to accumulate resources.
Our framework for understanding financial extraction in criminal justice places
emphasis on both “predation” and “punishment.” On one end of this framework,
Harris (2016) places emphasis on the “culture of punishment” motivating these
practices; that is, that were primarily put into place as a means of socially control
poor people of color (Kohler-Hausmann, 2018), and aimed at crime control
(Feeley and Simon, 1992). On the other end, Page and Soss (2017) place emphasis
on characterizing financial takings as “predation” or the state’s move to treat the
arrested as potential financial resources. They note, these practices in criminal
justice must be drawn into a “common frame of analysis with payday lending,
subprime auto and home lending, and other predatory projects that exploit mar-
ginalized communities as captive markets” (Page and Soss, 2017: 1). In total, the
expansion of financial takings in criminal justice is driven by all these forces: racist
discourse to expand punishment, state actors’ efforts to buttress cash-strapped
government budgets, and the effort to create profitable market opportunities for
private sector interests.
This article applies this framework to a historical case study of a significant
expansion of telephone revenue in the Los Angeles County (County) jails—by far
the largest jail system in North America—during a critical crisis period in the
1990s. Evidence is derived from archival material concerning the governance of
the County jails. The case’s parameters exemplify the elements predicted by the
existing model of financial extraction: its jail system was in the midst of severe
austerity – with jails being closed and thousands of inmates being released early –
and the signing of profitable contract with Pacific Bell that generated unprecedent-
ed revenue for the jail system.
However, the case presents a puzzle. The windfall from the new telephone
contract was used to expand jail mental healthcare staffing, open a 200-bed med-
ical tower in the County’s flagship jail, and implement a new medical information
system to better track inmate’s health needs. On the surface, such use of profits to
improve conditions of confinement cannot be fully explained by the existing frame-
work of predation and punishment.
The central argument is two-fold. First, is that alongside severe fiscal austerity,
it was legal demand concerning inmate’s healthcare that shaped the historical
formation of LA County’s use of telephone profits. Second, County officials
exploited legal ambiguity in penal codes in order to be able to use such revenue
for programs that straddled both health and welfare, predation, and punishment.
For instance, the character of expanded healthcare services included significant
108 Punishment & Society 23(1)
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