This is how to make homelessness policy work

Late last month, the world watched something extraordinary: San Francisco cleaned up its homeless mess, practically overnight.

Unfortunately for residents of that city, it wasn’t for them.

The quick cleanup was a courtesy to the Chinese leader Xi Jinping and 20,000 other visitors to the Asia-Pacific Economic Cooperation meeting.

And it was only a temporary measure.

The joke seems to be on Californians, and it has been for decades as the Golden State has deteriorated under bad policies. 

I grew up in California, spent nearly my entire life there, and started my family there.

I started multiple billion-dollar companies in California — in healthcare, finance, and defense — and a venture capital firm, 8VC. 

But in 2020 I moved to Texas. Since my move, I’ve been successful in making policy reforms in the Lone Star State that California desperately needs through my policy group, Cicero Institute.

Homelessness is one of our issues.

I’ve taken fire for strong stands before, but as we started to make big changes in homeless policy around the US, even I was surprised by the viciousness with which activists and progressive leaders went after me and my group.

The popularity of so-called ‘housing-first’ initiatives have prioritized securing suitable shelter for the homeless before figuring out ways to end homelessness as a whole. AFP via Getty Images

To date, we’ve achieved legislative victories in five states on this issue of homelessness, with full overhauls in two states, and many more in the pipeline.

To activists that make a living managing — but never solving — the homeless crisis, our reforms are a nightmare.

We’ve tied their funding to metrics, putting dollars for ineffective, ideologically-driven groups on the chopping block.

We’ve banned dangerous tent encampments in multiple states and cities. We’ve made it easier to civilly commit those who are mentally ill and need treatment. And we’ve pulled money from failed “Housing First” programs. 

A protest in Los Angeles by activists against the eviction of a homeless encampment in Echo Park, Los Angeles. REUTERS

The progressive attacks against me, an outspoken entrepreneur, practically write themselves.

Vice, for instance, went with “A Palantir Co-Founder Is Pushing Laws to Criminalize Homeless Encampments Nationwide.”

Some are much more aggressive. Ann Oliva, the CEO of the National Alliance to End Homelessness — a major homeless special interest group — said on NPR that I am trying to put the homeless in “internment camps.” (Her term for state-run facilities with running water, toilets, and police to prevent violence and sex-trafficking against women and children.)

Another popular idea in the homeless lobby is that I want to arrest the homeless in order to incarcerate them in my own private prisons! Really.

One homeless NGO said this: “He is significantly invested in the private prison industry through his venture capital firm … Housing First keeps people off the streets and out of prison, which means fewer profits for billionaires like Lonsdale.”

Ann Oliva is CEO of the National Alliance to End Homelessness — a major homeless special interest group. National Alliance to End Homelessness

I’ve never invested in a private prison and actually spent millions to reform prisons and improve their outcomes for communities. 

But facts don’t matter to activist groups. 

What does matter to them? Incentives. And right now the incentives are terrible: the more homeless there are, the more money they get.

But we are undoing those incentives state by state. Eventually, we’ll fix them at the root and fix the Department of Housing and Urban Development in DC.

After decades of failed policies in cities like Los Angeles and San Francisco, Californians have come to expect needles, feces and bodies on the street.

Over 170,000 people are homeless in California, and the majority are unsheltered. 

“People are homeless because of the complete and utter failure of our capitalist economy,” said San Francisco City Supervisor Dean Preston. David G. McIntyre

It is a horrific state of affairs, most of all for the homeless themselves.

And there is no serious effort to change the state’s failing strategy, explicitly encouraged by HUD, which emphasizes building free housing for the homeless and giving it to them with no questions asked. 

Why has it failed?

First, giving away free housing — the “Housing First” strategy — does not solve homelessness or the underlying issues afflicting the homeless.

Studies have shown that it requires between eight and 20 units of housing to get one chronically-homeless person off the street, because there is much higher demand for free houses than there are free houses.

A sign in San Francisco’s embattled Tenderloin District advertises the area’s clean-up before the Biden-Xi summit. David G. McIntyre

Efforts like in San Francisco — paying NGOs to put drug addicts in hotel rooms and calling it “supportive housing” — are not a serious effort to fight homelessness. They are a scam.

One of San Francisco’s “Permanent Supportive Housing” programs had a startling 25% death rate. But it was lucrative for the non-profits that were paid to oversee the overdoses. 

The city pays NGOs almost $60,000 per year to “operate” each tent in front of City Hall. That’s more than many of my young employees pay in rent in San Francisco — for a tent!

Again: it’s a total waste of money, but activists connected to the government are making a fortune. Why would they support change?

Another problem is that homeless services are explicitly oriented around concepts like “equity” and “vulnerability” — i.e. prioritizing the most troubled individuals for free housing. Things like drug addiction, criminal violence and mental illness actually advantage individuals in the homeless housing lottery against those who are non-violent and trying to get work, for example. 

A San Francisco Police officer asks local homeless people to move as part of city efforts to combat homelessness prior to the recent Biden-Xi summit outside of the city. AFP via Getty Images

For many non-profit organizations, “equity” comes before solutions. Austin’s “Ending Community Homeless Coalition” (ECHO) declared, “We must dismantle white male supremacy in homelessness services”

This is a culture that doesn’t care about results — because the organizations don’t have incentives for results.

They do, however, have incentives for virtue signaling, and for building political machines to turn out votes and donations for progressive politicians who will keep providing them with funding — and little in terms of oversight.

Relatively soon into my move to Austin, we helped push the sorts of policy changes that California desperately needs.

In May 2021, Austinites voted 58-42 to reinstate the city’s ban on street camping, which the city council had decided to repeal in 2018.

Biden and Xi at their APEC summit — which left host city San Francisco tidier than ever. REUTERS

The 2018 strategy of inviting the homeless to create dangerous encampments was a disaster.

The number of homeless in the city more than doubled. Drug overdoses soared. Homeless deaths climbed to record highs. Vulnerable women abandoned in camps by the far-left city council became subject to sex trafficking. And yet, we are called cruel for opposing the camps. 

But the crisis wasn’t bad news for everyone. For well-connected activists, it was a financial boon.

In the years from 2018 to 2021, the city council doubled spending on homelessness to $179 million. That meant more money for progressive groups. 

In May 2021, Austinites voted 58-42 to reinstate the city’s ban on street camping, which the city council had decided to repeal in 2018. Getty Images

Far-left politicians and activists believe that if they can convince the public that capitalism is failing — for example, by parading widespread homelessness outside banks and offices (the symbols of capitalism) — they can radically alter those systems. 

Supervisor Dean Preston, one of the chief architects of anarchy in San Francisco, told the socialist magazine Jacobin as a candidate, “people are homeless because of the complete and utter failure of our capitalist economy. Or maybe not failure… Maybe it’s working exactly as it’s supposed to.”

It goes back to Marx and his idea of false consciousness — citizens in a capitalist society are blinded to the root cause of all problems (capitalism).

San Francisco’s Nancy Pelosi Federal Building at 7th Street and Mission surrounded by homeless and drug users. David G. McIntyre

In order to pursue socialism, you have to show the public that capitalism doesn’t work. Sometimes it feels like they don’t want America to work. 

Because that means that they don’t have to change — America does.

Panic has set in among activists as a result of our work. One in Tennessee told Vice: “It’s just terrifying how successful they’ve been.”

Unlike many ‘progressive’ cities, Austin has taken meaningful strides to reign in their homeless problem. Dave Creaney for NY Post

In the Kansas Capitol, dozens of activists and officials showed up to make a scene opposing our legislation, yelling at my colleague and the only supporter in the room, economist Judge Glock. 

Their arguments that we are “criminalizing homelessness” are not landing.

We won the vote to ban street camping in Austin, which couldn’t happen without liberal support.

Economist Judge Glock bore the brunt of activist opposition to homeless reform efforts in Tennessee.

We won in Georgia after two years of fighting — with bipartisan support despite aggressive lobbying from powerful groups like the SPLC. 

The brave Missouri senator who sponsored our successful legislation, Holly Thompson Rehder, was even homeless herself as a child. Activists tried to lecture her about compassion; but she knew better than most that leaving people on the street is cruel.

We made civil commitment — aka “involuntary commitment — easier in Utah to get help to those who need it most. 

Missouri Sen. Holly Thompson Rehder was homeless as a child and has worked to help get those without homes off of the streets. Morris Boyd Photography for NY Post

“Housing First” has failed, and will continue to lead to death and suffering, with corrupt NGOs and incentives that reward drugs and violence. But America’s founders gave us a federalist system with states as laboratories, and we can use them to show what really works.

While California cleans up to impress foreign leaders, other states are embracing bold policy changes to lift up the needy and get people the help they need. 

With non-ideological policies rooted in incentives, accountability, and competence, we will show a better way and build a brighter future for our urban centers.

We can inspire leaders to rise up and put cities back in their proper place as pedestals of a civilization of which we are all proud to be a part.

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