Around 40 to 50 percent have a serious mental illness. And many are not being treated. Also some of the mentally ill have anosognosia, and so don't even realize that they have a problem.
So sure, it would be nice if a lot more people had the resolve to get off alcohol and work, but it is a lot tougher for some to do this.
After a minute of thought I cannot come up with one. It could be a psychological effect akin to the social safety net, which indirectly increases morale and loyalty, and then, indirectly, boosts the economy, but it is still a stretch.
Therefore, treating them looks to me as a wholly unfavorable proposition and the current non-arrangement would be the more-or-less optimized case.
How am I wrong?
But, does it really work out that way? That is:
cost of providing housing and essential care to homeless + cost of treating any of those with mental disabilities < economic benefit from increasing general quality of environment.
Sure housing prices would rise, but the left side of the inequality is direct tax payer money. The right side comes indirectly from sales, public facilities, and property. Knowing that prisoners are locked away in interest of lowering crime rate, at a $20K+/year/prisoner [1], that seems, on a hunch, difficult.
It looks quite intricate. And, knowing that modern corporations will have no business in doing this, it is a public service; some people might not be interested in paying this tax. Hence, doing nothing seems to not be very far from optimal, as it looks.
Or, is that inequality correct, and RHS - LHS gives a good number?
[1] http://en.wikipedia.org/wiki/Prisons_in_the_United_States
http://www.onlyinsanfrancisco.com/sfnews/?p=926
If there are lots of homeless people panhandling in tourist areas, then tourists may want to spend their dollars elsewhere.
If we assume the ratio is some proportion of the general population, it would still be surprising if the effect warranted a full-fledged government-sponsored program (warrant, in the sense of profit, which I am assuming is the only means to convince most modern organizations to action).
As a soft example, I was told there are many pocket pickers in Milan that basically exhibit no hesitation nor covertness (in your face, even) in their stealing attempts. I don't know the impact on numbers, but I know that tourists are forewarned and generally go, aware of the risks.
Bear in mind that obviously I only know this equation from the middle-class white-collar side; for all I know, the lives of the Manhattan homeless are no better than in cities where they could be more rambunctious.
Well, there's quality of life aspects of not having them on the streets, etc.
But perhaps that's not direct enough for you -- so one way to save is on health care. Since hospitals must give emergency care to all patients regardless of finances, these types of cases often end up being very expensive due to frequent hospital stays.
There are plenty of articles about that point, here's one: http://content.nejm.org/cgi/content/full/338/24/1734
Which is another problem with treating healthcare as a business: the better you are at it, the less often your customers return.
Someone who is mentally disabled, as in unable to take care of themselves, would not be able to survive long-term homelessness.
This is the insanity defense. There are two outcomes of this.
First, insanity defense stands, and they are absolved of responsibility over their actions. I did indeed conflate the two, and it is part of the reason why I thought doing something different may not change the optimality of the current situation. (They have a switch they cannot turn off unless you constantly medicate them (very expensive), and so if the social burden isn't great, do nothing.)
Second, it doesn't stand, then perhaps there is a conclusive economic value and societal benefit in a program that helps reassimilation. But it's not that simple: suggesting it is a non-innate trait implies that there was volition involved in their behavior. Again there are two ways to look at this:
1. they are consciously obstructive and antisocial (technical definition) members of society, which is, in a way, criminal.
2. they have a tendency to lapse into such illness, which comes around to suggest, again, something innate.
Alas, I don't have a resolution.
The problem with mental illness is that it messes with the concept of "intentional" behaviour. If you are mentally ill, your sick brain may motivate you to do something antisocial or even criminal that, were you mentally well, you would never do.
So just because it is intentional _at the time of illness_ doesn't mean it is truly intentional, conscious behaviour.
2. Consider a diabetic. Without regular shots of insulin, they will lapse into a coma. More "criminally" antisocial behaviour? Many forms of diabetes are a combination of genetic and lifestyle factors -- these people have a "tendency to lapse into diabetes", if you will. However, with regular shots of insulin and other lifestyle changes, they can be perfectly productive individuals.
Again, with mental illness it is harder to see that someone with a genetic predisposition to imbalanced levels of, say, serotonin, triggered by drug abuse, is not at fault for their condition. But with medical treatment and lifestyle changes, they too can control their condition.
In both cases, it is in society's interest to help them do so, even from the barest economic principles. Factor in some basic human compassion, and it becomes imperative.
It's hard to quantify because in the other cases, such as diabetes, the effects of insulin and no insulin are quite well determined, as an all-or-none outcome, and the cost-benefit analysis is very straightforward. Not so sure about the case of dealing with the head.
So we may go ahead with some program under the principle of "capable until proven incapable," telling ourselves that there is definite positive benefit. It may well be true, but the payoff is distance and uncertain. Also, is coercion involved? "We will provide free training for you" ... after a few days "screw this I want my alcohol" -- at this point, what to do? Extend the counseling? Or, trust their rationality that they are capable of seeing what is in their interests?
If the current situation is grossly suboptimal at least one person should have been looking for a solution. Misfits have been around for long enough, making me think it is part of the social dynamic. Or, the unpopular question that no politician will want to hear.
Take pharma for example. Seemingly a noble industry, but rampant extortion on the people who precisely cannot handle it. The incentive for compassion is indirect: it is tied to PR, then probably profits (even in this case, I suspect in many cases the PR loss is nothing as long as they are legally operating, from advantages of oligopoly).
Or, if your model of economics includes things like happiness and societal health quantified into a general utility function. But this would seem to be an avalanche of variables that try to tease out things like the utility of eating junk food.
(My stepmother is running a pilot program in Greensboro, NC to test this theory - so far the hypothesis is spot on. Google "Housing First" if interested.)