- Pushes down wages for other workers doing similar labor, by taking demand out from the normal market
- Because the prison itself (or, more likely, the prison-industrial-complex corporation running it) is seeing a huge profit from these ventures, it provides a perverse incentive to keep their labor pool 'strong', be it through lobbying for harsher sentences, or encouraging shot quotas amongst their guards/COs.
- Conditions prisoners towards working less for equal work (we shouldn't encourage the idea that -any- class, race, or creed of human being is worth less for the same amount of work)
No its not, because that work generate value for companies at a very low cost. So it both builds a system that pushes for more people in prison and displaces workers who would have been paid higher.
Prisoners should be given some kind of work / study / something. But it should't generate value for anyone but the prisoner or perhaps lower costs for the prison (cleaning/etc)