Addressing the Homeless Crisis in Los Angeles
With the 2022 election season in full swing, activists with clipboards and ambitious ballot initiatives are gathering signatures outside local supermarkets. Their aim? To gain your support for new legislation that promises increased funding for a range of unconventional ideas.
In California, particularly in Los Angeles, initiatives aimed at allocating more funds to address the growing number of makeshift shelters in urban areas are blossoming. The reasoning behind these initiatives is strong.
As of 2020, California reported over 161,000 homeless individuals. Specifically, the homeless population in Los Angeles County was documented at 66,463, a number that has likely increased since then.
Who can ignore the pressing need to address the proliferation of tent encampments, the presence of open fires, and the myriad issues of public drug use, crime, and mental health struggles evident in the region?
Clearly, action is required. But what kind of action?
One of the state measures on the 2022 ballot, the California Solutions to Homelessness and Mental Health Act, aims to secure hundreds of millions of dollars annually to tackle homelessness. This funding would derive from taxes on online sports betting.
Additionally, Los Angeles has proposed its own citywide initiative called the Los Angeles Program to Prevent Homelessness and Fund Affordable Housing. According to the United to House LA campaign, this measure could generate around $875 million each year by implementing a new two-tier assessment on the sale of properties valued over $5 million.
Could these initiatives effectively resolve the ongoing homeless crisis?
If so, the crisis would likely have been resolved long ago. Here’s why…
Issues with Compulsory Philanthropy
At Economic Prism, we don’t possess a $5 million residence, nor do we engage in sports betting.
Even so, we recognize these proposals for what they truly are: substantial financial pursuits benefitting California’s homeless industrial complex.
These initiatives do little to resolve the escalating homelessness that worsens year after year. How do we know this?
The evidence lies in the consistent failure of similar financial schemes aimed at aiding the homeless. While these proposals yield significant profits for oversight agencies and non-profits—essentially, the homeless industrial complex—they rarely achieve real progress for those in need.
The homeless situation in Los Angeles County is dire, with approximately 70,000 individuals affected. In the City of Los Angeles alone, this number exceeds 40,000. Strikingly, this persists even after the City and County increased funding by $4.7 billion through Proposition HHH and Measure H in 2016 and 2017.
Proposition HHH was a bond measure intended to facilitate the construction of permanent supportive housing. Advocates refer to this method as “housing first.” Measure H, on the other hand, implemented a 0.25 percent sales tax increase across the County, elevating certain cities’ sales tax rates above 10.25 percent.
What has Los Angeles achieved with its nearly $5 billion investment in homelessness?
Major philanthropic organizations that endorsed these initiatives have crafted lofty rhetoric. Fred Ali, president and CEO of the Weingart Foundation based in LA, stated:
“We can’t let our sense of what’s possible be limited to what we’ve been able to do so far. Philanthropy can be the laboratory for an agenda to overturn racial injustice, challenge white supremacy and nurture equity. It can also build support for new funding streams and new governance structures.”
Meanwhile, United Way Los Angeles claims on its website:
“We’re on a mission to permanently break the cycle of poverty for our most vulnerable neighbors: low-income families, students, veterans and people experiencing homelessness… By focusing on local, state, and national public policy, we fight poverty’s root causes through the systems that sustain them. We led the fight that resulted in nearly $5 billion in civic funds being dedicated to solutions to ending poverty.”
What “root causes” related to poverty is United Way Los Angeles actually addressing?
Sustaining the Homeless Industrial Complex
The focus on combating poverty’s “root causes” has led to a fervent commitment to the “housing first” strategy for addressing homelessness. Philanthropic entities like United Way dismiss temporary solutions like shelters or transitional housing as mere stopgaps.
The “housing first” model has proven to be a dismal failure, especially when assessing the increasing number of homeless individuals on the streets since its initiation. However, from the perspective of financial gain for the homeless industrial complex, it has been wildly successful.
In the fight against homelessness, fundraising goals often take precedence over tangible outcomes. The accumulation of funds—your funds—becomes the primary objective.
Unfortunately for taxpayers, secure funding often requires more than leveraging private resources; it demands the allocation of public funds toward the progressive visions championed by these philanthropic organizations.
A recent City audit revealed that Los Angeles now spends $837,000 for each housing unit constructed for a homeless individual. This reflects the “housing first” approach at work.
Since the approval of Proposition HHH in 2016, only about 1,200 housing units have been completed, translating to around 200 units per year.
Indeed, significant corruption exists within Los Angeles’s homeless industrial complex, contributing to a system that perpetuates its status quo to continue the inflow of funds. At the current rate, addressing the needs of 40,000 homeless individuals through the “housing first” model would take roughly 200 years, totaling an estimated cost of $33.5 billion.
Despite these staggering figures, Democratic Mayor Eric Garcetti maintains that the program is effectively producing results. According to Garcetti, the initiative “is producing more units than promised, at a lower cost than expected.”
Garcetti seems to be shielding the failures of the “housing first” initiative. Perhaps following the end of his second term later this year, he can secure employment within a non-profit aligned with LA’s homeless industrial complex.
This community thrives on funding. And with the introduction of new initiatives on the ballot, it is primed to expand even further.
Sincerely,
MN Gordon
for Economic Prism
Return from Feeding LA’s Homeless Industrial Complex to Economic Prism
