Shares of Geo Group (NYSE:GEO) and CoreCivic (NYSE:CXW) are popping on Monday following last week's Congressional approval of President Donald Trump's massive tax and spending bill, which vastly increases funds for the administration's aggressive immigration policy.
What's happening? As the country's two largest private prisons and contractors with the now-expanding immigrant detention centers, their fortunes seem to be securely on the rise.
In keeping with a popular campaign promise, Trump's so-called "Big Beautiful Bill" will triple federal spending on immigrant detention by earmarking $45 billion over the next four years. That's more than the Obama, Biden and first Trump administrations spent combined.
Trump's tax bill, notes the Washington Post, also earmarks $46.5 billion for construction of the unfinished U.S.-Mexico border wall and $6 billion for surveillance and border technology.
Officials at U.S. Immigration and Customs Enforcement (ICE) said the funding would allow them to roughly double detention capacity to 100,000 beds and expand their ability to detain undocumented immigrants. ICE has awarded new or extended contracts this year to at least nine facilities operated by Geo Group and CoreCivic, along with others managing tent-based detention centers.
"This bill will make our communities safer by making a historic investment in our border security," said Rep. Addison McDowell. "No more dangerous illegal aliens parading around with no consequences."
Nationwide, ICE had detained 56,397 immigrants as of June 15, the highest number on record since the agency began disclosing such data and far above its funded capacity of 41,500, according to the Cato Institute.
Rep. Alexandria Ocasio-Cortez (D-NY) has taken the Trump administration to task on various occasions for what she describes as a massive financial windfall for private prison companies, accusing them of prioritizing profits over humane conditions for detainees.
Other lawmakers have called the ICE-directed cash "budgetary mismanagement" after funds had to be redirected from other departments.
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