It unironically is a great use of money, if it wasn't they wouldn't do it. Prison Labor is basically slavery, and just as absurdly profitable, plus private prisons make more money with more inmates and can lobby as such.
Well, mainly it's about funnelling taxpayer money into the hands of the prison industrial complex cause most states don't go quite so hard on the prison labor
It's a positive feedback loop built off of human suffering. Private Prisons lobby for more slave labor, making the Capitalist State more money, while the Prison Industrial Complex gets more money for imprisoning more people, and more slave labor to sell cheap commodities.
Sure, but money exists to benefit the ones holding Capital. The system itself supports and reinforces profit above all else, as such, it's a great use of money for Capitalists.
If you mean that it's unethical and negative for the health of society, of course, I agree entirely. We can't solve this problem outright without transitioning to Socialism.
I would advise you to read some books (like actual books, not a YouTube video essay about a book) about socialism because it seems to be something very different than you think.