Sen. Bernie Sanders wants to abolish a multibillion-dollar industry: private prisons.

The presidential hopeful introduced a bill on Thursday that would ban private prisons within a few years, taking aim at what he called a "broken criminal justice system" and mass incarceration.

The plan is just the latest in what's increasingly becoming one of the biggest issues of the Democratic primaries: criminal justice. Hillary Clinton recently released an anti-drug plan that tries to shift drug policies away from punitive criminal justice measures to public health programs, and Sanders and Martin O'Malley released plans for addressing racial justice issues.

Still, Sanders's plan by itself probably wouldn't do much to reduce mass incarceration. While private prisons are a favorite target of liberals like Sanders, they house a small percentage of convicted criminals. The most effective part of Sanders's plan, in fact, may be a provision that has nothing to do with private prisons at all.

Sanders's plan would ban private prisons within a few years

The bill takes six main steps, according to Sanders's office:

Prohibit local, state, and federal contracts for privately run prisons within two years, with the possibility of a one-year extension if deemed necessary by the US attorney general. Eliminate private immigration detention centers within two years, with the possibility of a one-year extension if deemed necessary by the US attorney general. End the requirement that the federal government maintain a certain number of beds for immigrant detainees. Stop the detention of immigrant families caught at the border, and increase monitoring of immigrant detention facilities to ensure more humane conditions. Increase oversight to stop private companies from overcharging inmates for services like banking and phone calls. Reinstate the federal parole system.

Why Sanders introduced the plan

Sanders characterized the plan as a "good first step" toward fixing a problem both political parties now acknowledge: America has the largest prison population in the world, and housing all those inmates is very expensive.

"At a time when we are spending $50 billion a year on our correctional system, it makes a lot more sense to me to be investing in jobs and education for our young people than in more and more jails," Sanders said in a statement. "Not only can we prevent thousands of lives from being destroyed, we can save billions of taxpayer dollars. Locking people up is a lot more expensive than schools."

"Not only can we prevent thousands of lives from being destroyed, we can save billions of taxpayer dollars"

The plan focuses on going after private prisons and the perverse incentives surrounding them. Private prison contracts typically pay companies for each inmate they house (often with occupancy requirements), so these companies stand to profit the most when there are more people to incarcerate. And in general, there are going to be more business opportunities for private prison companies if more inmates require more prisons.

As a result, private prison companies have a financial incentive to encourage mass incarceration. A 2011 report from the Justice Policy Initiative found, for example, that private prison companies lobby and support politicians that back tough-on-crime policies like "three strikes" and "truth in sentencing" laws, which effectively increase the length of prison sentences.

Sanders's plan would also try to eliminate another way private companies profit from prisons: charging high rates and fees for basic services. For example, prison inmates don't have many options for banking and money transfers. So, as a 2014 report from the Center for Public Integrity found, companies often charge exorbitant fees — as high as 45 percent in some states — for cash transfers, knowing inmates and their families have no choice but to pay up if they want to buy toothpaste and other items (which are also often overpriced) at prison stores. (This happens at both private and public facilities, which contract with private companies for these services.)

The plan would additionally increase the federal government's monitoring of immigrant detention centers to try to improve conditions at the facilities. The American Civil Liberties Union has repeatedly found that these facilities — many of which are privatized — deny basic services to detainees, including health care, legal representation, and access to telephones.

Sanders's plan also sneaks in a provision that has nothing to do with private prisons: bring back federal parole. This system, which lets inmates out early after they serve part of their sentences, was eliminated in 1984 at the federal level. But in addition to rewarding good behavior, it provides a way to ease mass incarceration: If a prisoner proves he's no longer a threat to the public, it might be better to let him out while keeping him under some sort of supervision.

Private prisons hold a small fraction of traditional US prisoners

Although the bill primarily focuses on private prisons, a small portion of US prisoners are in private facilities. Sanders acknowledges this: His office noted that 19.1 percent of federal prisoners and 6.8 percent of state inmates — or 8.4 percent of all prisoners in the US — were in private prisons in 2013. So the ban on private prisons would affect a small fraction of traditional prison inmates.

But Sanders's plan would help eliminate incentives to detain as many immigrants as possible

Sanders's ban on private prisons would have a much bigger impact on a different type of incarceration: immigrant detention centers.

About 62 percent of bed space for people detained by Immigration and Customs Enforcement is in privately run facilities, according to a 2015 analysis by the advocacy group Grassroots Leadership. And a 2012 report from the Associated Press found that private prison companies had spent tens of millions of dollars lobbying lawmakers and contributing to political campaigns to maintain and increase the flow of detainees — to some success.

To these companies' benefit, some immigration policies encourage more incarceration. The federal government, for instance, is required to maintain at least 34,000 beds for immigrant detainees. Critics have called this a "quota," although Secretary of Homeland Security Jeh Johnson said the federal government isn't required to keep the beds filled. Still, it likely provides some sort of incentive for incarceration — maintaining 34,000 beds for detainees is a waste of money if those beds go unused.

Sanders's plan addresses these issues: It abolishes private immigrant detention centers, and repeals the bed space requirement altogether.

The plan plays on a big liberal myth about private prisons and mass incarceration

One of the potential reasons Sanders focuses on private prisons, even though they're a small part of the criminal justice system, is it's good politics. Among liberals who back Sanders, there's a widely held belief that private prisons caused and perpetuated mass incarceration.

According to this view, allowing private prisons created a for-profit incentive to lock up as many people as possible, and, as a result, private prison companies have pushed for policies that led to mass incarceration to keep their big profits flowing.

This is the kind of belief that riles up Sanders's base. He and his supporters generally believe that money is corrupting politics, and that the rich use their wealth to push American lawmakers into selfish, wrongheaded policies. The idea that private prisons perpetuated mass incarceration plays into this antagonistic worldview toward money and politics.

There are two problems with this view: For one, private prisons are a small part of the criminal justice system, so they don't hold a lot of sway over the whole system. And two, it mixes up the causal relationship between privatization and mass incarceration.

Private prisons are a response to mass incarceration, not a cause of it. The Sentencing Project, which advocates for reduced incarceration, explained this in 2004, noting that the era of privatization came after mass incarceration began:

With a burgeoning prison population resulting from the "war on drugs" and increased use of incarceration, prison overcrowding and rising costs became increasingly problematic for local, state, and federal governments. In response to this expanding criminal justice system, private business interests saw an opportunity for expansion, and consequently, private-sector involvement in prisons moved from the simple contracting of services to contracting for the complete management and operation of entire prisons.

For example, in 2011, Ohio became the first state to sell a state prison to a private company. It figured that the expense of running the Lake Erie Correctional Institution was so high that it would be better if a private company — viewed as more efficient than the government — bore the costs. But Ohio only embraced this plan after mass incarceration consumed a big portion of its budget, forcing the state to look for new ways to save money. So mass incarceration led to privatization, not the other way around.

(A big caveat: There's some academic debate over whether private prisons really are more cost-efficient than public facilities. But the perception that they are is why the industry expanded after the 1980s — in response to mass incarceration.)

The actual cause of mass incarceration is much simpler: the crime waves of the late 1960s to early 1990s. During this era, the media propagated alarming reports about shootings, gang violence, and drugs. So the public demanded lawmakers do something about crime. And lawmakers, believing the threat of punishment would deter criminal activity, passed tough-on-crime policies that led to mass incarceration.

Understanding this cause is crucial to grasping why there's such a huge push to end mass incarceration today: Now that crime is near historical lows, and the research shows mass incarceration played a small role in the crime drop, lawmakers and the public are more open to the idea of relaxing tough-on-crime policies — and this push for reform is proceeding, particularly in state governments, despite the privatization of a small fraction of prisons.

Sanders's best idea for reducing mass incarceration has nothing to do with private prisons

In terms of fighting mass incarceration, the best idea in Sanders's plan might be the provision to bring back federal parole.

The Sentencing Reform Act of 1984 eliminated federal parole and replaced it with "supervised release." But parole and supervised release are quite different, as the Congressional Research Service explained:

[W]hereas parole functions in lieu of a remaining prison term, supervised release begins only after a defendant has completed his full prison sentence. Where revocation of parole could lead to a return to prison to finish out a defendant’s original sentence, revocation of supervised release can lead to a return to prison for a term in addition to that imposed for the defendant’s original sentence.

Federal prisoners can still have sentences reduced through good behavior. But this is limited: According to Families Against Mandatory Minimums, current law lets inmates shave 47 days off each year of their sentence. Providing parole as an option could let even more well-behaved inmates out of prison early.

Still, even this part of Sanders's bill would play a small role in reducing mass incarceration: Federal inmates make up about 14 percent of all US prisoners, and only a few of them would likely qualify for and actually get parole.

But, as Sanders says, it could be a good first step. And it would potentially affect many more inmates' sentences than simply eliminating private prisons would.