In responding to my earlier Berkeleyside opinion piece on the problem of moral hazard in developing effective homeless policies, Jacquelyn McCormick (JM), senior advisor, to our Mayor, offers what she characterizes as a counterpoint to my remarks. A fairer characterization of her response would be that it demonstrates a dogged persistence in missing the point.

By the way, the title of my original opinion piece i.e. “Berkeley Homeless Policy and the Moral Hazard Problem” provides a fairly strong hint as to the point of the piece – one strong enough that even JM could at least have gotten the basic drift. Rather than reprise the article here, I will suggest that you read it for yourself. It is short and, I hope, clear. The core of the article consists of two propositions:

  • Moral hazard attaches to every government action to relieve social problems. Here moral hazard refers to the fact that every action (say a homeless subsidy) to relieve suffering inevitably creates, at least for some people, an incentive to indulge in the behavior that leads to that suffering.
  • The moral hazard problem for homeless policies is particularly severe. Indeed, the persistence of homelessness and the recent increase in its extent are not disputed even by JM.

Although my article also provides a little historical review of the attempt to deal with the moral hazard problem and also some mild prescriptions for improving our policies, you can safely ignore the added detail.

So what are the counterpoints that JM provides to my views of the moral hazard problem of homeless policies? Well, neither time nor space nor good sense allows for a complete response to the various “counter points” but I will respond to a few as follows:

Causes of homelessness according to JM

Here is the money quote from JM for this counterpoint – “For the past 20 years, every bit of academic, scientifically rigorous literature on the subject demonstrates that the single most robust predictor of homelessness is the housing market.” Really? Every bit? Wow. Just as an aside I know JM and I have never known her to read a single piece of academic literature. Perhaps as a courtesy she will, in her next piece, divulge just a few examples of scientifically rigorous literature so that we can fact check a little bit. But I digress. I am especially fond of this particular counterpoint because it presents a trifecta of the liberal idiocies that infect the Berkeley debates on social policy. These are:

Irrelevancy: The causes of homelessness are irrelevant to the any of the opinions expressed in my article. The problem of moral hazard arises not from the causes of homelessness but rather from the flawed attempts to fix it. Moreover, I said nothing about the fundamental causes of homelessness. I only noted that every attempt to ameliorate it involves some bad side effects. I did note that these bad side effects are particularly severe for those fixes that liberal governments prefer. My guess is that it was this criticism of the political fraud of liberalism that triggered JM’s frantic grab for the first handy irrelevancy.

JM also adds the jab (or is it counter jab?) that my opinions have “little predictive value in determining who becomes homeless and who doesn’t”. Again, even if true, this point is totally irrelevant. Of course, I never made any predictions about homelessness at all. Indeed, it appears to me that we know fairly well who becomes homeless. See for example: The National Law Center on Homelessness and Poverty. This is just one of many good resources on the statistics and policy solutions to homelessness. Perhaps JM can provide a list of the resources she relied on in compiling the above-mentioned inventory of “every bit of scientifically rigorous literature”. More importantly perhaps JM can point to the logic that leads to the relevance of her exaggerations.

Hypocrisy: Here you have JM, a primary contributor to the failed housing market in Berkeley, blaming the failed market for the problems of homelessness. This in itself would be acceptable in that it is at least arguably partially true. The hypocrisy arises from JM’s use of a housing crisis, largely created by the liberal policies she so ardently advocates, to discredit an opinion of which she has no understanding. Again, and just for the record, in my article, I said nothing about the causes of homelessness.

Later in her response, JM goes on an even deeper excursion into the area of housing geography and economics. We get the usual list of totally irrelevant and also often false comparisons of Berkeley to other cities – in this case Detroit and Milwaukee. Normally I would not object overmuch to such substitution of anecdote for actual analysis. Most people have been exposed to it so much that they readily see through it. But again, it is the hypocrisy that deserves at least a mention here. JM offers Detroit’s disaster – largely created by corrupt liberal policies such as advocated by JM – as an argument for implementing the same policies here in Berkeley. Wow.

Virtue signaling: Here the virtue signaling takes the form of an ostentatious parading of her compassion for the homeless. This a favorite tactic of the liberal politician. Again, I do not overmuch object to virtue signaling except when it is used as a substitute for an argument. Here we have JM sorrowfully announcing the countless interviews she has conducted with those suffering from homelessness. Again, I do not much object to such hyperbole because at least we can discuss the issue. However, I do object to the use of virtue signaling to cut off counter arguments. In essence, what JM is saying by her display of compassion, is that counter arguments are a priori discredited for lack of compassion. In short, JM is suggesting that she has a monopoly on compassion so shut up already. This is a bridge too far for me to tolerate.

Just one more comment on this favorite tactic of liberals i.e. virtue-signaling. Usually the signaling is accomplished by announcing the extensive and amazing sampling of truly needy people that the signaler has interviewed. This is the case with JM. What I am curious about is the sampling rules used by the signalers. Or more specifically, are the samples they select representative of the homeless population, or are they selected to support the moral superiority of the signaler?

Government is the answer to the homeless problem according to JM

Here is the money quote from JM on this counterpoint to me: “Government is the only entity with the size and scope to address such macro-economic conditions. Unfortunately, however, federal supports for homelessness and affordable housing have been shrinking for nearly 40 years. The HUD budget for affordable housing today is a mere fraction of what it was in 1980”

Again, I am going to ignore the total irrelevance of this claim and focus just briefly on its truth. For the comments below I am again relying on the aforementioned National Law Center on Homelessness and Poverty.

Here again JM relies on popular prejudice and ignorance to slip an irrelevancy and probably a falsehood into the discussion. Since JM provides no support for her claim that Federal support for homelessness has declined, it is a little difficult to analyze. What is certain, however, is that total Federal spending by HUD and other agencies has regularly increased. Moreover, state spending nationwide has also regularly increased So, to say that Federal spending in this area has been diminishing for 40 years seems wildly improbable. Perhaps JM can provide some supporting documentation for this claim.

Parenthetically, I would also note that when one considers total spending on homelessness relief, the spending by the private sector dwarfs that of the public sector. People rarely consider the spending by private institutions, individuals, and families when looking at social problems because it has no public relations firm representing it. On the other hand, people are acutely aware of public sector spending on social problems because it has politicians and their public relations hacks representing it. This is yet another convenient deception by liberals.

However, there is a more important and outrageous claim in the above quote – that is that only government is adequate to address the problem of homelessness. Yes, I know that to be precise JM is saying that only government is adequate to address the macro-economic conditions that cause homelessness. But the value proposition is the same: give money and power to government and it will solve homelessness.

Based on first principles and a rudimentary understanding of the history of homelessness in our society, the above value proposition is an absurdity. My contention is that, on balance, government (local, state and Federal) has made the problem worse. I do not contest that public monies can and do relieve suffering of homelessness but I also contend that private charities are more efficient and effective in accomplishing the same end. I contend that this is largely because private charities are better equipped to deal with the moral hazard problem.

We stigmatize the homeless according to JM

Here is the money quote on this counterpoint by JM. “Our biggest job is in educating the public so the stigma and assumptions of homelessness are debunked. We are hopeful that in understanding the story of today’s homeless people, caring and generous Berkeleyans will willingly become part of the solution.”

Let us blow past the obvious irrelevance of the claim, and go right to deconstructing what little meaning there is here.

Really — amid all the myriad social problems and suffering related to homelessness in our communities, our first priority is to re-educate you, the public — the unwashed, unenlightened taxpayers (and philanthropists by the way) of Berkeley who are busy stigmatizing the homeless. Apparently, JM is hopeful that there are a few of you who, as a result of her debunking efforts, will finally and willingly become “part of the solution”. When properly re-educated you will hopefully vote for an ever expanding public sector – which by the way will be necessary since there will be ever expanding homelessness. Fortunately for you, JM has presented in her opinion piece a representative picture of the homeless sufficient to rid you of your stigmatizing ways. This seems to me more of an egregious example of virtue-signaling than a serious proposal to address homelessness.

I could go on examining the many counterpoints presented by JM but by now I have probably exhausted your patience and I have certainly exhausted mine.

In summary I ask just a simple question. Is it not about time for Berkeley to re-examine the basis of homeless policies rather than repeat the same failed platitudes offered by JM?

Robert Krumme is a structural engineer and researcher specializing in aseismic design, founder of the award-winning Seismic Technical Advisory Panel, and former member of various Berkeley commissions including the Public Works Commission.
Robert Krumme is a structural engineer and researcher specializing in aseismic design, founder of the award-winning Seismic Technical Advisory Panel, and former member of various Berkeley commissions including the Public Works Commission.