Jail needs to be hell on Earth, and a place where no man or woman dares to enter.
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My idea to save money on prisons is to make an arrangement with some South American or Asian country like Pakistan, for example, to house our prisoners. The cost to fly them over there and paying a fee per prisoner per year to the host country would be a mere fraction of what it costs to feed, guard, and house them over here. Cost savings for us is a good thing.
Secondly, the conditions over there would be terrible (indeed, that would be one of the priority points on the list - the worse the prison is, the better). The result is that when a convict did get released, he would be unwilling to regress and his horror stories would prevent others from risking prison. Of course, a lot of them simply wouldn't survive their sentences, since the FULL sentence would be carried out, no parole, no "good behavior", no plea bargaining for lighter sentences, etc. Death from disease, old age, and maltreatment would take out quite a few.
So we'd have cheaper costs, a prison system that was truly feared, and no crimes from recently-paroled criminals. I only ask for a mere 1% of the costs savings.