Homeless in California

I found this youtube clip quite distressing. It is an interview of a young homeless man in California.

Estimates for the number of homeless in America vary depending on whether the measure is taken on a single night or covers an entire year.

Using the "single night" methodology, a U.S. Department of Housing and Urban Development report estimated that on a single night in January 2008, there were 664,414 homeless people. About 6 out of 10 were in some kind of homeless shelter; the remaining 4 out of 10 were living in the street or in another place "not intended for human habitation".  About three-fifths of the homeless on a single night were homeless as individuals (62 percent), while two-fifths (38 percent) were homeless as part of a family.

Using the "in a single year" approach, about 1.6 million persons used an emergency shelter or a transitional housing program during the 12-month period between October 1, 2008 and September 30, 2009. This number suggests that roughly 1 in every 190 persons in America used the shelter system at some point during the year. Around a third are homeless within a family unit, with a million being recorded as "homeless individuals".

Since then, things could have only got worse....

It is tempting to fall back on stereotyping the homeless and placing the blame on the individual weakness, such drug or alcohol addiction or mental illness. However, here is a study, written in 2001, about the rise of the homeless in California. The paper concludes that it was largely housing affordability that explained the huge increase in homelessness:

Here is how the abstract of the paper put it......

It is generally believed that the increased incidence of homelessness in the United States has arisen from broad societal factors, such as changes in the institutionalization of the mentally ill, increases in drug addiction and alcohol usage, and so forth.

This paper presents a comprehensive test of the alternate hypothesis that variations in homelessness arise from changed circumstances in the housing market and in the income distribution. We assemble essentially all the systematic information available on homelessness in U.S. urban areas: census counts, shelter bed counts, records of transfer payments, and administrative agency estimates. We estimate similar statistical models using four different samples of data on the incidence of homelessness , defined according to very different criteria.

Our results suggest that simple economic principles governing the availability and pricing of housing and the growth in demand for the lowest-quality housing explain a large portion of the variation in homelessness among U.S. metropolitan housing markets. Furthermore, rather modest improvements in the affordability of rental housing or its availability can substantially reduce the incidence of homelessness in the United States.

This is shocking stuff for the richest country in the world; an army of homeless people, who for most part, are out on the street due to a dysfunctional housing market and stagnant real wages.