Yea, there is that aspect of it. Ideally, I will go buy them a meal, so they can't use the money for other things. I personally don't indulge in "other things", but I don't know how concerned I am about them using the money for that either. I think it's very, very difficult for someone digging through trash to get their life together, so if they indulge, they indulge. Note that it's not a comment on their character or anything of the sort, just the sheer number of things needed to re-adjust in society from zero, with zero real help.

Another point is that in most countries outside of the US, panhandlers are either "working for themselves" and make decent money, perhaps better than at a low-end job while having proper living arrangements, etc (and thus "rob" the true poor from the donation). It can also be worse, with situations where panhandlers are actually curated by an organizer who pays them a salary and takes a profit. The latter schemes are also mixed up in exploitation.

Now that I type it all out, I am realizing that buying a meal also prevents the second scenario too. Good stuff.