Three things come to mind:
One: Who guards the guards? What happens to any society when so much of its legal infrastructure, tax money, and human treasure go into a prison-industrial system?
Two: As Janine Wedel pointed out in her book on The Shadow Elite, there was a robust program aimed at privatizing many of the functions formerly run and managed by government entities. These government entities were arguably answerable to The People, the constituents of very real regions and districts.
Now the chain of accountability has been watered down as private entities can hide their nefarious dealings in ways that government entities cannot.
Three: Disaster Capitalism's mark on this system of incarceration: Just as it's cheaper to work towards prevention than to apply boatloads of cure, instead of investing in a system that made people less likely to break laws, disinvestment in urban deserts inevitably contributes to an ongoing stream of would-be inmates.
Disaster Capitalism relies upon creating problems and then seeing privatizers rush in proclaiming that they alone have the solution. They charge more than did their former government-run counterparts (Insurance company management of health care as opposed to direct access is a significant example of this ridiculous business-devised rip-off) and provide worse services (think: Detroit's water today).