Gallery D

The Poor House

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Is Debtor’s Prison Making A Comeback?

By James Donahue

When I was a child I recall a large empty concrete building on the outskirts of the county seat that I was told was the old “poorhouse” where people were forced to stay and work off debts. They said residents of the poorhouse kept a garden on the grounds and raised their own food.
I don’t know how true the story was because at the time, poor farms and debtor’s prisons had been closed down by federal law in the United States for over a century. The introduction of bankruptcy laws created a legal way for people to eliminate financial debt when they had no other way out.

Changes in the bankruptcy laws which have been going on during the past decade or longer, are making it more difficult and more costly for people to use this means to climb out of debt. For example, people must pay for debt counseling services and a substantial cash-up-front lawyer’s fee before they can even file. And people in debt like that usually don’t have the means of making such payments.

As property values drop and more and more people are out of work, but prices keep rising, cities and counties are finding themselves pinched for the revenues needed to keep local services operating. They are doing things like imposing higher fees for parking violations, local services and charging prisoners for room and board during their time in the local jails.

That governments are charging prisoners for time spent in jail obviously contradicts the concept of serving jail time in exchange for paying off personal debt. How does one pay off debt while in jail and unable to work? So what is to be done?

A recent report noted that debt collection agencies are a growing business in the United States where more than 35 percent of the people are unable to pay their bills. Most of the money is owed to credit card companies which are charging outlandish fees of up to 24 percent interest on loaned money. It is a form of organized crime in disguise.

Now there appears a new private scam called Judicial Corrections Services. This is a privately operated company that contracts with the courts to manage the probation of people that cannot pay fines and court costs. These people not only get charged these fees, but also a monthly supervision fee, with interest. When they fail to pay, the courts issue warrants for their arrest, and they then have additional fines, court costs and jail rent fees added to the initial debt. 

Sometimes small $100 fines can grow to thousands of dollars in debt for people trying to exist on welfare and unemployment checks. They find themselves in financial holes that are impossible to climb out of.

Currently there are private judicial correction services operating in about 12 states, and the number may be growing.

Somehow these operators are getting around a 1980 Supreme Court ruling that made it illegal to put someone in jail because they cannot pay a debt, especially if there hasn’t been a hearing to determine their economic status.

People who are unable to pay simply can’t pay. And throwing them in jail isn’t going to help.