In any real-life revision of the parable so often cited by philanthropists, there’s a strong likelihood that the philanthropists forging their way upstream to the source of the problem will never get there. As with the challenge of homelessness in L.A., they will instead become hopelessly entangled in the real-world obstacles that invariably complicate the drive for simplistic, root-cause solutions.
Readers of The Giving Review will recall that we’ve been following developments in public policy toward homelessness in Los Angeles, because—as we discussed in a three-part series in October 2019—philanthropy played a major role in shaping it.
That policy has just come under massive judicial attack. On April 20, Los Angeles Times readers were greeted with a news story that opened this way:
A federal judge overseeing a sprawling lawsuit about homelessness in Los Angeles ordered the city and county Tuesday to offer some form of shelter or housing to the entire homeless population of skid row by October.
Judge David O. Carter granted a preliminary injunction sought by the plaintiffs in the case last week and now is telling the city and county that they must offer single women and unaccompanied children on skid row a place to stay within 90 days, help families within 120 days and finally, by Oct. 18, offer every homeless person on skid row housing or shelter.
The ruling argues that L.A. city and county wrongly focused on permanent housing at the expense of more temporary shelter, “knowing that massive development delays were likely while people died in the streets.” That element of the order underscores the judge’s skepticism of a core part of L.A.’s current strategy to tackle homelessness.
As we noted in our treatment of the issue, Los Angeles had committed itself to the now-problematic “permanent housing” (or Housing First) approach with a series of bond and tax measures in 2016, after a full-court press by the local United Way, and with the enthusiastic backing of the major local foundations.
The Housing First approach maintains that homeless individuals should be offered immediate and unconditional access to housing along with supportive social services, without expecting prior changes in all-too-prevalent drug or alcohol abuse. This would solve the homelessness problem once and for all, so it was claimed, and reduce the need for “merely” charitable efforts that just cope with the problem, like Judge Carter’s “more temporary shelter.” (TGR readers will immediately recognize the tell-tale signs of “root-cause” thinking.)
Los Angeles’ commitment to Housing First can be traced back to a report published in 2010 by the local United Way and Chamber of Commerce, entitled Home for Good. It announced the social-service establishment’s determination to “end chronic and veteran homelessness in Los Angeles by 2016.”
Although the city was already spending vast sums on homelessness programs and related health and law-enforcement services, the report claimed, it was just managing the problem, not solving it. But the report also observed that some three-fourths of the spending was consumed by chronically homeless individuals, who comprised just one-quarter of the population.
By placing that hardest-to-serve minority into permanent supportive housing, Home for Good promised, chronic homelessness would be “ended,” and at less cost than just accommodating the homeless. As the report put it, “By redirecting and coordinating our existing resources, we can eliminate homelessness in Los Angeles. By acting rationally and efficiently, we can ultimately spend far less then we do now.”
A “funders collaborative” assembled itself around this effort, which by 2016 included 27 government-related and 30 private funders, including major L.A. players like the Annenberg, Weingart, Aileen Getty, Pritzker Family, and Conrad Hilton Foundations, as well as the California Endowment. The group raised $34 million for programs from 2012 to 2016, while bringing in $700 million in government dollars.
Nonetheless, the problem of homelessness gave no sign of being “solved” over that time, with the annual homeless count in 2015 increasing by 16% over the previous year, to 44,000 individuals. But for true believers in Housing First, this wasn’t a warning that the approach itself might be flawed. It just meant that Los Angeles had yet to get serious about it, by tapping deeply enough into taxpayer support.
And so the collaborative sponsored a ballot measure for the November 2016 election: Proposition HHH, a $1.2 billion bond measure to help finance up to 10,000 units of permanent supportive housing over the next 10 years. It passed overwhelmingly, followed shortly thereafter by Measure H in Los Angeles County, which was designed to raise some $3.5 billion over 10 years through a quarter-cent hike in county sales taxes. Measure H would, among other things, provide funding for the wrap-around supportive services required to make HHH housing work.
For scholars James M. Ferris and Nicholas P. O. Williams at the University of Southern California’s Center on Philanthropy & Public Policy, these successful ballot initiatives were a national model for how truly strategic philanthropy should engage in public policy.
As they noted in the Center’s publication Scaling Up: How Philanthropy Helped Unlock $4.7 Billion to Tackle Homelessness, modern foundations should no longer just spend their own meager and inadequate resources on social problems. Even if properly coordinated behind a root-cause solution like Housing First, far more dollars would be required for systemic impact.
And only substantial and dedicated public funding could supply that. Philanthropy thus must overcome its traditional reluctance to engage in political activism, and seek to mobilize taxpayer dollars behind the foundations’ preferred solutions. As Scaling Up put it, philanthropy must play “a more active role in policymaking at all stages of the process—from helping to frame the ballot measures to working to get them passed.”
A powerful “theory of change” like Housing First; the determination to coordinate all private and public resources behind it; and the willingness to plunge into politics to secure yet more public funds—this is, as Ferris and Williams suggest, the quintessence of contemporary root-cause philanthropy.
As we noted in Part 2 of our series on homelessness in L.A., the assumptions behind Housing First had begun to crumble well before Judge Carter’s scathing assessment. It turns out that the proportion of the hardest-to-serve drug-addicted and mentally ill homeless population is probably closer to two-thirds than one-quarter of the total, the Los Angeles Times found in its own recalculation of the homeless count.
More important, Los Angeles City Controller Ron Galperin found in October 2019 that, even while no HHH-supported units had yet been built (three years after the measure was approved), the average cost of a single unit had soared to $531,373, a total that exceeded the median sale price of a market-rate condominium in L.A.
Furthermore, some 40% of this price tag was going toward “soft costs,” including non-construction activities like fees, consultants, and finance costs. As a result, it appeared that nowhere near 10,000 units—itself now a ridiculously inadequate number in light of soaring homelessness numbers—were going to be constructed with HHH dollars.
(Galperin’s alarming findings, by the way, were cited in Judge Carter’s ruling, prompting the judge to demand a thoroughgoing and immediate audit of all spending on homeless programs. That may well be one of the most useful outcomes of the case.)
Since our TGR series on homelessness in Los Angeles, the world has changed dramatically. The onset of the pandemic and its devastating economic consequences have thrown many more low-income individuals out of precarious housing situations and onto the streets. This has been offset to some degree by an eviction freeze. A flood of new dollars has been made available to move COVID-vulnerable homeless individuals from the streets into hotel rooms through Project Roomkey.
The pandemic also led Los Angeles Mayor Garcetti to suspend deadlines for HHH-supported construction. It even caused the suspension of the 2021 Greater Los Angeles Homeless Count, so we have no firm idea how many people are currently living on the streets.
But we do know that in the latest available count, published on June 12, 2020, by the Los Angeles Homeless Services Authority (LAHSA), homeless totals in Los Angeles County had risen by yet another 12.7% from the 2019 count, to a total of 66,436. LAHSA executive director Heidi Marston pointed out that her agency did “not like these numbers” because “we have done so much to bring tens of thousands inside.”
The numbers, and the ruling
Judge David Carter clearly didn’t “like the numbers” either, though he wasn’t particularly impressed by what LAHSA and others had done “to bring tens of thousands inside.”
I’ll let others analyze the legal aspects of Carter’s ruling, which the city and county plan to appeal. Ed Whelan of the Ethics and Public Policy Center signals one possible take in the title of his insightful piece for National Review: “Federal Judge Seizes Power as L.A. Homelessness Czar.” And since our series on homelessness, Manhattan Institute senior fellow Christopher Rufo has published a hard-hitting critique of the moral and behavioral foundations of Housing First.
But one thing is clear from the ruling in LA Alliance for Human Rights v. City of Los Angeles: the judge is no fan of Los Angeles’s unyielding, philanthropy-driven devotion to Housing First.
Thanks to the decision of Los Angeles officials to focus intensively on Housing First, the judge maintained, the local authorities had run afoul of the Fourteenth Amendment’s “state-created danger” doctrine. Judge Carter’s argument on this point—which is a devastating indictment of Housing First—is worth quoting at length:
[T]here is … incontrovertible evidence that the danger of living on the streets—which led to 1,383 deaths last year alone—is state-made. The strongest evidence for a state-made danger is the deliberate, political choice to pursue the development of long-term supportive housing at the expense of interim shelters to get people off the streets in the near-term. As Plaintiffs pointed out in their brief, Proposition HHH—the $1.2 billion ballot initiative to create 10,000 housing units for the homeless—provided funding that could be used either for long-term supportive housing or for temporary shelters. Nevertheless, the City and County “unilaterally” decided to focus on housing at the expense of shelter, even knowing that massive development delays were likely while people died in the streets. Over the four years since HHH’s passage, a mere 489 housing units have been built, while over 5,000 people lost their lives in the streets due to a lack of shelter. The vast majority of those deaths were preventable.
In other words, the root-cause solution championed for more than a decade by Los Angeles philanthropy had led local authorities to turn a blind eye to actual, everyday suffering and death on the city’s streets. This result was not only morally repugnant but also, as it turns out, legally trammeled. Had local authorities not been persuaded by the philanthropic elites to embrace the grand, systemic solution of Housing First, more dollars would no doubt have gone toward immediate shelter—which, the decision suggests, would have saved lives, rather than sacrificing them on the altar of social-science theory.
Judge Carter’s ruling confirmed (and no doubt was informed by) the views of Rev. Andy Bales, longtime director of the local Union Rescue Mission, veteran of the battle against homelessness, and skeptic of the Housing First orthodoxy. Speaking to Eddie Kim at Downtown Los Angeles six years ago, Bales observed that, thanks to the Housing First frenzy, it was becoming ever more difficult to raise money for his “mere charity.”
“We had one foundation say we’re not going to give to you anymore, we’re going to give to housing-first programs and Home for Good,” Bales said during a recent visit. “They had given up to a million dollars a year to us. We had another who gave up to $750,000 a year, and they said we’re not giving to you anymore, we want to fund permanent supportive housing. I had to give a speech to a coalition of 28 churches, because the group expressed a desire to switch to funding only housing solutions.”
Will Judge Carter’s decision, along with soaring rates of homelessness in Los Angeles, lead to a reassessment of Housing First? Probably not. Philanthropy is hopelessly addicted to root-cause solutions.
The river, root causes, and a real-life revision
Everyone in the sector has heard—innumerable times—the parable of the “babies in the river.” It’s meant to illustrate the superiority of root-cause philanthropy over “mere Band-aid” charity. In this far-fetched tale, babies are found to be floating helplessly down the river. And so local charities frantically start rescuing them, one by one. That is, until an enterprising strategic philanthropist suggests that they get to the “root cause” of the problem, by dispatching a walker upriver to prevent the babies from entering the river in the first place. Problem solved, once and for all!
But anyone who has ever ventured an overland shortcut out of a Michigan trout stream back to the car can attest that this sort of walk is no sure thing. On the map, it looks like a short, simple hike. But it’s incredibly easy to get lost in the alder thickets along the banks, disoriented by the oxbows, or bogged down in stream-side wetlands.
In a real-life revision of the “baby” parable, there’s a strong likelihood that the philanthropists forging their way upstream to the source of the problem will never get there. They will instead become hopelessly entangled in the real-world obstacles that invariably complicate the drive for simplistic, root-cause solutions. Meanwhile, there are fewer “mere charities” downstream to catch the babies. And so yet more lives are lost.
This is, in essence, what Judge Carter and Rev. Bales are saying about Los Angeles’ experience with Housing First. On the conceptual map, it looked so promising. But it has sucked massive amounts of dollars away from shelters and other immediate and concrete programs, because they only promised pathetic, temporary, piecemeal, “charitable” solutions.
At the same time, though, the dollars that could otherwise at least have saved lives one-by-one, one day at a time, never arrived upriver, at the sweeping systemic solutions that promised to permanently “solve” the problem of chronic homelessness.
Los Angeles has gotten lost on the way to root causes. And thanks to the single-minded devotion of its philanthropic establishment to Housing First, it is likely to remain lost.