Homelessnomics in San Francisco

I’ve wondered here why there isn’t a massive migration of homeless Americans to Santa Monica and other warm beach-side California towns. What do the economics look like in comparatively cold and rainy San Francisco? From NBC, Bay Area:

San Francisco is slated to spend nearly $280 million this year on housing and services for the homeless — a roughly 40 percent increase compared to just five years ago. Over that same span, however, the number of homeless in the city has largely remained the same at about 7,500 people, according to city counts.

So they’re spending $37,333 per homeless person. In other words, if San Francisco simply gave each officially “homeless” person this money, instead of shoveling out the cash to the official do-gooders and bureaucrats, those who are homeless would be receiving, on an after-tax basis, roughly the same as the median full-time American worker (Wikipedia says $44,980 is the median for pre-tax earnings). I think that this is not counting whatever the state and Federal governments spend on these folks, e.g., for Medicaid, SNAP, and Obamaphones. Thus, if they could convert all of their welfare benefits into cash, they would presumably be above-median earners.

10 thoughts on “Homelessnomics in San Francisco

  1. I was born in SF and have lived within 100 miles of it my whole life, there are more homeless people there than I have ever seen, in neighborhoods I have never seen them before. I do not believe those official estimates as they tend to leave some groups out and are often based off numbers seen at shelters (you’ll notice NBC gives no official source for those numbers). Increasingly, SF’s homeless are pitching tents, often in the farthest reaches of Hunter’s Point and other chronically under-policed and under-served areas. Other than tents, you are seeing a lot more “Roadwarriors” in their RVs and cars. I have even seen people renting RVs on craigslist as more affordable housing then apartments.

    Aside from the official numbers of homeless in SF being off, that money, even combined with any other benefits they are currently getting (which they would become ineligible for with an income of 45k a year) they would still be at/below the average wage in SF, and still could not afford a studio. The cheapest studio I have seen in SF recently was going for $2,600. That rent would take up around 31,000 of their income, so over 2/3, which is is a dangerous situation for one to be in, that leaves little money for food, insurance, and all the other necessities of modern living.

    I don’t dispute that this money will be grossly misused, but your attempt to boil this down to simple economics does not hold up if you factor in the reality of how expensive it is to live in SF.

  2. What Mitchell said, plus, as you yourself noted, what is spent on homeless is not given directly to them, so this is a non argument to start with.

  3. ” shoveling out the cash to the official do-gooders and bureaucrats”

    Charity is now a big business, which benefits those distributing the funds and services more than those receiving it.

    The Daily Wire ran an excellent essay on the failure of government welfare and professional social workers to do good, “No, Jesus Is Not Even Close To A Socialist”

    >The socialist views poverty, and all human suffering, as a cultural disease that must be cured by the generosity of the State. It takes responsibility out of the hands of the individual and places it into the hands of the collective, which is really a collection of bureaucrats. It allows you to look at a poor man and say, “He’s not my problem because he’s our problem.” And by “our” you really means “their.”

    >The Christian way is to personally and directly serve the less fortunate, thereby affirming their humanity and recognizing their dignity as persons. This is not mere sentimentalism; there is a practical benefit here as well. People are much more likely to emerge from the depths of poverty if they are treated with dignity and respect. A system that meets the needs of the poor but deprives them of dignity is not a system that can effectively lift the poor out of poverty. It is much more likely to keep them there, fed and clothed but in despair.


  4. Market & 7th after 10pm is a single mob of homeless as far as you can see. They come out at night, after the internet switches from political memes to Netflix originals. Besides the sanitation issue, they do pretty well compared to startup employees. They at least have better phones than any employee can afford after taxes. They get the most generous benefits of anywhere, which keeps them coming.

  5. There aren’t huge numbers more homeless. What is happening is that as more and more formerly vacant lots are taken up by construction, specially in the SOMA district, the homeless are no longer tucked away in hidden encampments, but spilling onto the streets and more visible.

    80% of the homeless are former residents, so there isn’t a huge influx of homeless moving here to mooch. Not surprising, as poor people have very limited mobility.

    SF has a powerful welfare-industrial complex. When former mayor Gavin Newsom mooted the idea the galaxy of nonprofits feeding at the through should report on the cost-effectiveness of their efforts, there was a backlash at the audacity of requiring accountability. The rejoinder was that as nonprofits provide public services, the City should pay to provide their employees the same gold-plated benefits city employees get.

    SF’s annual budget is $11B, up from $5B a decade ago. The City talks a good game about homelessness, but when you see where the money is spent, you get a sense of revealed preferences. We are spending $50M a year on painting bike lanes, for instance (at the same time the city claims it can’t afford the $73M/year needed to fix our abysmal roads, and need to raise a bond measure to pay for it). And of course, city employees managed to capture around 40% of the tech windfall in salaries and benefits.

  6. There is a massive migration of homeless to Los Angeles. We spend billions and billions of dollars on them. If you build it they will come! I think we have around 75,000 homeless! So that’s 10 times the amount in rainy San Francisco.

  7. Mitchell: “your attempt to boil this down to simple economics does not hold up if you factor in the reality of how expensive it is to live in SF.”

    I did not mean to imply that, if given the cash, the folks who are currently homeless in SF could become middle-class in SF. My point was that these folks could be above-median earners compared to Americans as a whole. Thus, assuming that they willing to locate to a part of the U.S. at the median cost of living they would then enjoy an above-median standard of living.

  8. Back in the “old” days, small town mayors and small city mayors would give homeless a bit of money and a bus ticket “out of town”. The idea was “not in my town”, you can be homeless somewhere else.

  9. @philg: “I did not mean to imply that, if given the cash, the folks who are currently homeless in SF could become middle-class in SF. My point was that these folks could be above-median earners compared to Americans as a whole. ”

    The problem is that if the SF homeless lived in flyover country, the virtue signaling in supporting them would disappear in SF. Also, the ability of local public servants to skim would be diminished.

    @Glen: Bribing homeless people to leave is alive and well:



    I also believe towns in Norway in the 19th century gave their public charges boat tickets to America, although I cannot locate a reference right now.

  10. The spending on the 7500 homeless people is no where near $37,333. I looked into those numbers myself. The majority of the $280 million goes to people receiving housing assistance. The remainder is spent on the 7500 homeless.

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