In August 2009 Jeff Smith, then a Missouri State Senator, pled guilty to two counts of obstruction of justice and resigned his seat. Five months later he went to federal prison–and found it bustling with resourceful men with shrewd business instincts.
B.J. was one of many fellow inmates with big plans for the future. He vowed that upon his release, he'd leave the dope game and fly straight. He'd recently purchased a porn website targeted at men with a fetish for women having sex on top of or inside luxury cars, with a special focus that explained his nickname. For just $10,000, he had purchased the domain name, the site design, and all of the necessary back-end work enabling financial transactions. The only component B.J. needed to supply were the women, and due to his incarceration, he'd named his 19-year-old son "vice president for personnel and talent development" and charged him with overseeing auditions. Who says a good old-fashioned family business can't make it anymore?
It was my first week in a federal prison, and I was beginning to see that it was far more nuanced than the hotbed of sex, drugs, and violence depicted on television documentaries. It was teeming with ambitious, street-smart men, many who appear to have been very successful drug dealers on the outside, and some of whom possess business instincts as sharp as those of the CEOs who wined and dined me six months before. Using somewhat different jargon than you might hear at Wharton, they discussed business concepts such as promotional incentives ("I don't never charge no first-time user"), quality control and new product launches ("you try anything new, you better have some longtime crackhead test your new shit"), territorial expansion ("Once Dude on the East Side got chalked, I had my dopeboys out on his corners befo' that motherf---er's body was cold"), and even barriers to entry ("Any motherf---er that wanna do bidness on the West Side know me and my boys ain't scurred to cap his ass").
But very little drug-dealing actually went on in the confines of the Manchester, Kentucky, prison where I spent most of 2010. Instead, in an institution where approximately 90 percent of the population had committed drug-related offenses, most of the people were focused on trying to survive on sub-poverty wages (my salary started at $5.25/month for a 40-hr/week warehouse job). So, except for those who had a sugar daddy on the outside, inmates focused on 1. How to make money to buy hygiene products, writing materials, stamps, haircuts, and any snacks outside institution food; and 2. How to make a living on the outside, since for most of the offenders, this was the final stop on a multi-facility tour as a guest of the United States of America.
There were a myriad of "hustles" inmates created to help themselves live more comfortably, and every hustle fell somewhere different on the spectrum of acceptability to the administration. Some hustles were perfectly legal and could be done in front of the COs (guards), such as washing and ironing another inmate's jumpsuit before a family visit, or the jailhouse lawyers who wrote legal briefs and cop-outs for other inmates. Others, such as the in-cell stores reselling food items from the commissary or one-man barbershops that operated most evenings, were technically illegal, but the COs looked the other way. The next level on the continuum were the tattoo artists, poker dealers, and bookies, whose businesses were frowned upon and often busted up by COs. The most risky businesses—which were also, of course, the most profitable, as even prison walls can't destroy the rules of risk-reward or the entrepreneurial spirit—were the smugglers of contraband: cigarettes, steroids, pornographic movies, cell phones, etc. With cigarettes going for about $3 apiece and some of the other goods running into the hundreds of dollars, the guys who ran these businesses could become quite wealthy by prison standards. In the parlance of FCI Manchester, they were dubbed "entrepre-niggaz."
Wealth, however, was measured not in dollars but in stamps, which were the regular currency since the prohibition of cigarettes at all federal prisons. But since some inmates had loaded up their commissary accounts with tens of thousands of dollars on their way in or asked their relatives to do so, there was a lot of money floating around the prison, although most of it was in 37- and 39-cent stamps (which, incidentally, were worth exactly as much as 44-cent ones). Books of stamps went for a discounted price—$6 instead of $8.80—and before going home, inmates who had accumulated hundreds of books of stamps sold them to other inmates, whose relatives on the street would wire thousands of dollars to the account of the seller.
The black market and the entrepreneurial drive of those who operated within it fascinated me. Want a cell phone? In prison it cost $250, thanks to the revenue stream it afforded its owner, who sold or bartered minutes to other inmates. Want dirty pictures? The price depended on the women's measurements and how brazenly she displayed them. But one issue of Hustler could fetch up to $200, largely due to the recurring revenue stream possible from copying the pictures and selling them individually, and from renting the magazine (once it's been laminated in plastic). How did the contraband get here? According to the veteran inmates, there were always prison guards who would help for the right price. But that wasn't necessary at our facility, since like most minimum-security facilities, we were surrounded only by natural barriers—in our case, a rocky ridge. There was a known "drop" site over the ridge near a winding road where friends on the outside could drop things for inmates to fetch in the middle of the night—or sometimes immediately after the daily 4 p.m. count while the COs were still occupied. The going rate for fetching something was $250, I found out one night after a basketball game during which my speed apparently made a fellow inmate think I would be the ideal candidate to be a "hill-runner."
I wasn't the least bit tempted, since anyone caught bringing in contraband was immediately sent "up the hill" to the medium-security prison packed with violent offenders doing 20- to 30-year bids. Since there was snow on the ground for weeks after I arrived, the price of contraband had risen and the "delivery fee" had skyrocketed: No one wanted to risk the treacherous route when the untrammeled snow rendered footprints easily visible to the guards.
The Prison Warehouse
Two weeks after my arrival, I was assigned to work at the prison warehouse, where seven of us unloaded all the food that came in to both prisons, feeding 2,000 inmates plus several hundred staff. My boss, a hard-nosed Bureau of Prisons veteran, told us on our first day that as long as we didn't steal any food, she would feed us adequately, and we wouldn't have any trouble. Both of my first-day colleagues left that afternoon with a dozen frozen chicken patties and several pieces of produce. They quickly followed the lead of the veterans, taking as much as possible at day's end, Saran-wrapping food around their chest and stuffing produce into every available pocket and crevice to be sold upon our return to the compound. (I often wondered how much demand would fall if the customers knew the conditions of transit.)
I'd vowed to my girlfriend, my family, and myself that I wouldn't break any rules, but then after a week, a friendly inmate approached me and told me that I'd better start stealing, because if I didn't start soon, one of my warehouse colleagues was going to plant raw meat in my coat, which if discovered would get me sent to the "hole" (isolation), and then to the medium-security prison. (Because I wasn't taking anything, they feared I would rat them out.) So, I started taking some fruits here and there, but never sold them back on the compound, just gave them away to people I liked and to try to build some strategic alliances. My colleagues would probably tell you that watching me try to stuff a dozen tortilla shells down my pants on a truck home, and having them fall down my pants leg just before our boss opened the back of the truck, was their favorite memory of me. I never lived that one down.
Perhaps the defining characteristic of prison life is ingenuity. Whether it meant concocting delicious meals from scraps liberated from the kitchen and warehouse, or cutting hair with toenail clippers, or cooking grilled cheese with an iron, or making weights out of boulders placed in laundry bags and tied around a bar when the weight pile was shut down, inmates figured out how to do more with less. Many of the inmates then planned to put the ingenuity they learned in prison to good use on the outside, by starting barbershops, or restaurants, or personal training businesses based on the way prisoners treat their bodies as temples and sculpt them.
Sadly, though, there was almost no preparation for inmates to bring their ideas to reality. No one to help them write business plans, no one to help translate their intuitive grasp of business concepts into other (legal) industries, not even an Internet connection to help them learn more or begin looking for jobs. Leaving prison after a decade or more, with few if any practical skills, and not even knowing how to point and click, helps explain why nearly three of four U.S. prisoners re-offend. As Inc.com editor Mike Hofman suggested in his 2009 article Some Good Earners, these barriers are only exacerbated by employers that are reluctant to take a chance on convicted felons—especially in a tight labor market—another reason that starting businesses is an excellent option for ex-offenders. But as Inc.com grasped and as I saw first-hand, until governments and private citizens team up on a broader level to help nurture the entrepreneurial spirit of inmates, they won't learn any new business skills on the inside that will help them get back on their feet upon release. They'll only learn new hustles.
Jeff Smith, a Democratic member of the Missouri Senate from 2007 to 2009, has a Ph.D in political science from Washington University in St. Louis, and has taught there and at Dartmouth College. He's now consulting on affordable housing policy and writing a book about politics and prison.