Goldman to Invest in City Jail Program, Profiting if Recidivism Falls Sharply
Source: The New York Times
If the jail program does not succeed, MDRC can use the Bloomberg money to repay Goldman a portion of its loan; if the program does succeed, Goldman will be paid by the city’s Department of Correction, and MDRC may use the Bloomberg money for other social impact bonds, said James Anderson, director of the foundation’s government innovation program.
Jeffrey B. Liebman, a professor of public policy at Harvard University who has written about social impact bonds, said the New York contract would be widely scrutinized.
“This will get attention as perhaps the most interesting government contract written anywhere in the world this year,” Dr. Liebman said. “People will study the contract terms, and the New York City deal will become a model for other jurisdictions.”
But social impact bonds have also worried some people in the nonprofit and philanthropy field, who say monetary incentives could distort the programs or their evaluations.
“I’m not saying that the market is evil,” said Mark Rosenman, a professor emeritus at Union Institute and University in Cincinnati, “but I am saying when we get into a situation where we are encouraging investment in order to generate private profit as a substitute for government responsibility, we’re making a big mistake.”
Read more: http://www.nytimes.com/2012/08/02/nyregion/goldman-to-invest-in-new-york-city-jail-program.html?emc=eta1
Not much information provided about the "Adolescent Behavioral Learning Experience " (ABLE), other than it's part of the Bloomberg Administration’s year-old "Young Men’s Initiative."
More about the "Young Men's Initiative" here:
http://www.nyc.gov/portal/site/nycgov/menuitem.c0935b9a57bb4ef3daf2f1c701c789a0/index.jsp?pageID=mayor_press_release&catID=1194&doc_name=http%3A%2F%2Fwww.nyc.gov%2Fhtml%2Fom%2Fhtml%2F2011b%2Fpr282-11.html&cc=unused1978&rc=1194&ndi=1
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