The At-Risk-Youth Industry
Atlantic, The, December, 2002 by Eyal Press & Jennifer Washburn
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In August of 2000 the National Center for Children in Poverty, at Columbia University, released a study showing that despite the country's recent economic boom, 13 million American children were living in poverty—three million more than in 1979. For most Americans that was unsettling news, but for a small group of publicly traded companies it represented an opportunity.
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As the ranks of children living in poverty have grown during the past two decades, so have the ranks of juveniles filing through the nation's dependency and delinquency courts, typically landing in special-education programs, psychiatric-treatment centers, orphanages, and juvenile prisons. These were formerly run almost exclusively by nonprofit and public agencies. In the mid-1990s, however, a number of large, multistate for-profit companies emerged to form what Wall Street soon termed the "at-risk-youth industry." The financial incentives were compelling. In 1997 SunTrust Equitable Securities, one of the nation's leading investment firms, published a ...
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