Building a federal prison in Letcher County is a bad investment. U.S. Rep. Hal Rogers’ plan to spend $444 million to create 300 jobs is bizarre. Rogers, a fiscal conservative, is telling us, one job costs $1.48 million to create.
These aren’t high-paying jobs; federal prison employees make an average of $38,000 a year. So 300 employees making $38,000 costs $11.4 million annually. That is a return of 2.5 percent.
This money is earmarked, but that doesn’t stop me from envisioning a better use of tax dollars. They could be put into a high-yield bank account that generates 5 percent interest (which would be $22.2 million) every year.
If that yearly interest was divided by 55,000, which is a number you’d need to create a job that pays $45,000 to $40,000 a year after health insurance and employer insurance, you could create 400 jobs with $165,000 to spare. That’s 400 jobs, better paying and more sustainably sound, than the 300 jobs that Rogers’ office is pitching.
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If you look at data in Boyd, Clay, Martin and McCreary counties, crime rates increase after a prison is built. The poverty and unemployment rates increase as well. There is no metric that points to federal prisons working for Appalachia Kentucky.