FT News Briefing Monday, August 26
Aug 26, 2019
This summer special dives into the intense scrutiny facing America's private prison system and the financial strains on major players like GeoGroup and CoreCivic. It highlights how activists are shifting their focus from divestment to holding banks accountable for funding prison operations. The discussion also covers demographic changes in global cities, revealing population declines driven by high living costs. Lastly, it tackles the widening gap between rich and poor, urging immediate action to tackle growing inequality.
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Private Prisons Under Scrutiny
- America's private prisons face Wall Street pressure due to their role in immigration policies.
- Divestment campaigns and banks refusing loans impact their financial stability.
Loan Agreements and Activist Concerns
- Banks halting future loans to private prisons still honor existing contracts.
- Activists demand formal policies to ensure lasting change, fearing banks might reverse their decisions.
Financial Challenges for Private Prisons
- Private prisons face financial challenges due to their REIT structure, requiring them to distribute profits.
- Limited lending options increase borrowing costs, impacting their long-term viability.