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Bentham remained bitter throughout his later life about the rejection of the Panopticon scheme, convinced that it had been thwarted by the King and an aristocratic elite.
It was largely because of his sense of injustice that he developed his ideas of "sinister interest"—that is, of the vested interests of the powerful conspiring against a wider public interest—which underpinned many of his broader arguments for reform.
Using government money, Bentham bought the land on behalf of the Crown for £12,000 in November 1799.
From his point of view, the site was far from ideal, being marshy, unhealthy, and too small.
The Panopticon was intended to be cheaper than the prisons of his time, as it required fewer staff; "Allow me to construct a prison on this model," Bentham requested to a Committee for the Reform of Criminal Law, "I will be the gaoler. that the gaoler will have no salary—will cost nothing to the nation." As the watchmen cannot be seen, they need not be on duty at all times, effectively leaving the watching to the watched.
According to Bentham's design, the prisoners would also be used as menial labour, walking on wheels to spin looms or run a water wheel.
It is his prison that is now most widely meant by the term "panopticon".
Bentham described the Panopticon as "a new mode of obtaining power of mind over mind, in a quantity hitherto without example".
By blinds and other contrivances, the inspectors concealed […] from the observation of the prisoners: hence the sentiment of a sort of omnipresence—The whole circuit reviewable with little, or if necessary without any, change of place.Morals reformed—health preserved—industry invigorated—instruction diffused—public burthens lightened—Economy seated, as it were, upon a rock—the Gordian Knot of the poor-law not cut, but untied—all by a simple idea in Architecture!In 17, Bentham travelled to Krichev in White Russia (modern Belarus) to visit his brother, Samuel, who was engaged in managing various industrial and other projects for Prince Potemkin.Eventually Bentham turned to a site at Tothill Fields, near Westminster.Although this was common land, with no landowner, there were a number of parties with interests in it, including Earl Grosvenor, who owned a house on an adjacent site and objected to the idea of a prison overlooking it. At this point, however, it became clear that a nearby site at Millbank, adjoining the Thames, was available for sale, and this time things ran more smoothly.