Russ Roberts

Erica Sandberg on Homelessness and Downtown Streets Team

EconTalk Episode with Erica Sandberg
Hosted by Russ Roberts
I, Taxpayer... Everyday Tragedies...

homeless.jpg Podcaster and writer Erica Sandberg talks with EconTalk host Russ Roberts about homelessness in San Francisco. Sandberg talks about what the city can do about homelessness and her experience with Downtown Streets Team, which gives homeless people in the Bay Area the chance to work in exchange for gift cards that let them buy food and other basics.

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Readings and Links related to this podcast episode

Related Readings
This week's guest: This week's focus: Additional ideas and people mentioned in this podcast episode: A few more readings and background resources:
  • Charity, by Russell Roberts. Concise Encyclopedia of Economics.
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Podcast Episode Highlights

Intro. [Recording date: March 16, 2017.]

Russ Roberts: Our topic for today is a little bit different: it's homelessness, and some creative ways that people in the San Francisco area and surrounding areas are helping homeless people. Let's start, Erica. Tell us about yourself. What's your background?

Erica Sandberg: Hey, Russ. Yeah. My background is in personal finance, consumer finance actually--banking, credit issues, budgeting. And I do have a podcast--it's called "Adventures with Money," and it's all about how you can enjoy life no matter what you own or own or owe--it really doesn't matter. And that's my focus. It really is about how people can use money in a way that makes them really happy--truly fulfilled. And, kind of taking it down to a very basic level with that. And it's something that I love. It's something that I'm very passionate about.

Russ Roberts: So, on the surface that seems a very long way from homelessness. And, you live in the city of San Francisco. I spend my summers in the Palo Alto area, which is about--I don't know, 30 or 45 minutes or so south of the city itself. But in the whole Bay Area--partly for a variety of reasons--partly the weather, partly the nature of the citizenry, there are a lot of people living on the streets in the San Francisco area. And, as a citizen there, as a resident, you have encountered them just going about your life, right?

Erica Sandberg: Absolutely. It's a small city. So, when it comes to actual size, we don't have a lot of room for people to be dispersed when they are homeless. They are here. They are everywhere. And it's really alarming. I know that when people come to the city, they are so eager to enjoy it. And it's gorgeous. I mean, physically, it's one of the most beautiful cities in the United States, in my opinion. But then you see this situation, that's overwhelming, that really does shock people. And again, I think it is, in part, because there's not a lot of places for them to go. We've got about 6500 people technically on the street. And they are concentrated in very particular areas. And you can't get away from it. It's something that you see, feel, smell, touch. It's here.


Russ Roberts: Let's start a little bit with some philosophical issues. I think, certainly in the 1980s when homelessness became a political issue, and a social issue, a lot of people viewed it as a failure of government. They blamed Reagan budget cuts. They blamed it--homelessness--on housing policy. But, since then--and we've done a variety of things as a policy space to try to help people who are homeless, and deal with it--since then there has been some recognition that some of the people are on the street, maybe a significant number, have emotional and mental issues. Not merely a financial problem that they can't make ends meet or pay rent or own a house. And part of it is, when we do have government programs to help folks who are out on the street, some of them, for a whole bunch of reasons, just don't want to be part of that. Are those issues that arise in San Francisco?

Erica Sandberg: They are pervasive. And it's really interesting to me. Because I think many times we are asked to believe something that our eyes are telling us is completely different. We get a a lot of news reports and homeless advocates who say, 'Hey, these are, you know, women and children who are homeless.' And I'm looking around, thinking, 'This is not what I'm saying.' This is--right--and I know that they do exist. I'm not saying they don't. But, overwhelmingly, it is male. People who are clearly on a substance--alcohol, drugs, whatever it is that they are on--they are on something. And/or mentally ill. And--that is what we're seeing. So, is this a Grapes of Wrath-type of migration of people desperately seeking work and, you know, begging on the streets saying, 'We'll do anything!'? It's just not what I'm seeing. It's not what other people see. So--

Russ Roberts: When you talk about women with children, I think, some of them I assume are in homeless shelters. It's hard for us, unless you are working with that community it's hard to assess their, um, how common that is. And this of course is not just a San Francisco problem. We have it here in Washington, D.C. where I live outside the summer. It's certainly the case in NY [NYC?], which is not pleasant, but it's not uncommon, obviously, to see people on the street. We're talking about people who are literally living on the street--sleeping, collecting stuff, often pushing shopping carts with their belongings, or who have created little shelters of cardboard. It's a very tragic situation. And, they are predominantly male. And I don't--of course the substance abuse or use issue is hard to disentangle, because some people are probably are on alcohol and drugs, because they are miserable. And some are alcohol and drug users who became homeless as a result. So causation is running in both directions.

Erica Sandberg: Absolutely. And it really is. To use an old cliché--the chicken or the egg? What came first, here? And in a way it kind of doesn't matter. Because if you want to disentangle all of it, well, good luck with that.

Russ Roberts: Not so relevant if you are trying to help. Although it is--in the big picture it's relevant. I think--but I want to get back to your personal story, because you wrote a really interesting personal column for the San Francisco Chronicle about what you called 'Six Tragedies.' So, talk about that experience--what you wrote about in that article and what kind of reaction you got.

Erica Sandberg: Sure. Like a lot of people, I was just really fed up: you are kind of walking around thinking, 'What is being done?' We're walking by these people who are either dead, dying, in some way, shape or form suffering. And we get so anaesthetized to it: we walk by, we're not seeing it any longer.

Russ Roberts: [?] Right. We do--or we shuttle away. Or we kind of turn our heads and go, 'That's really horrible.' And we just keep walking. And it really hit me, over a long period of time how that is part of the problem. How, that absolutely is--we're not--and this is, I think, very key, and this is why I wrote the piece--is: We don't have the answers. As a person, I'm a consumer-finance person. I don't have the answer to this. But I do know that a lot of money is being generated that goes towards these issues. And we're not seeing any results. We're seeing these terrible things happen, and who is doing anything about it? It drove me nuts. It absolutely did. So, I just decided to kind of take it on and say, 'These are people who need assistance.' Now, let's get the people who are supposed to be doing something to do something. And , this is why I will never go into politics, because people like me, I want to needle them and say, 'Hey, we're on you. We're watching; this is what we're seeing and we really want some action. And it's up to you to figure out what that action may be.'


Russ Roberts: Now, I think you're a mom. Is that correct?

Erica Sandberg: Correct.

Russ Roberts: So, how old are your children, if I may ask?

Erica Sandberg: I have a daughter, and she's 14.

Russ Roberts: Okay. So, I have four kids; we live in the suburbs. We don't come across homeless people. Although, it's interesting--the suburban version of this is, and this has happened over the last 5 years, is people stand on street corners now at intersections with cardboard signs in the suburbs asking for money. They look fairly healthy. They look very different from the people that I see on the streets in the more urban environments. But beyond that, it was rare that I'd have to encounter a homeless person with one of my children. And, as I mentioned in the recent episode with Robert Whaples, I often give money to homeless people. Not a lot, but if they are asking, I often give. And I view that as the right thing to do. A lot of people don't agree with that. But that is something I wanted to model for my children. But, of course, I don't see them every day. And if I were walking by homeless folks every day I think I would probably become something closer--I worry I'd become something closer to anaesthetized, as you mentioned. And certainly with my kids, having to learn about that, I think that would be an interesting part of their childhood. But you have to decide how to talk about it and how to deal with that. Right?

Erica Sandberg: You got it. And I made this commitment when, my husband and I, we decided to stay here in San Francisco, knowing what's going on. Seeing it every day. To approach it in a very specific way. I want to make--I want to be part of something that is going to make an improvement, a long-term improvement. And when you--Russ, when I heard you say, 'Oh, I'll give them some money,' I just hung my head and I said, 'Noooo.' Everybody has got a personal choice. If you want--

Russ Roberts: I'm making a short-term improvement--

Erica Sandberg: Okay. That's right. And a lot of it is a very--you feel like you are doing the right thing. It helps you. And this is what I got to--I threw this out to Facebook today. I said, 'Do you give to people on the street or do you not? And if so, why? What's going on?' And almost everybody replied, 'Yeah, I do.' And because why? 'It makes me feel good. I'm doing the right thing. So, it's, I think it--not that there's anything wrong with personal gratification. You feel good doing something. But it is really doing anything for the person? Meh? No.

Russ Roberts: I feel good about it, not because I think I'm doing the right thing. I feel good about because I think I'm helping them. Now, I could be wrong. I might not actually be helping them. I might be making their situation worse. I might be discouraging them from choosing some other option. Right? I might be discouraging them from going to a more formal system of help. But my view is that the people I'm giving money to, the more tragic-looking ones--they either seem uneasy about having an interaction with, say, a non-profit or a government agency. And their lives are miserable. I feel bad for them. And I'm trying to do a very small amount to make their lives a little more pleasant. You think that's wrong?

Erica Sandberg: I think that's a decent argument. But I'm sorry to say, I don't think that actually stands the--the test of whether or not it's really going to do any good. Because you know, and I know--and we have to be so observant here--is: What is going to be done with that money? It kills me, it kills me to see it go to waste. And I'm going to make a judgment: It goes to waste if it's going to go to alcohol, drugs--you know, something harmful in the long run. And they get--

Russ Roberts: So why do you--

Erica Sandberg: even deeper than that. Ultimately even deeper than that. I think it's--

Russ Roberts: So, why do--go ahead.

Erica Sandberg: I think it's wrong that, when it does go to drugs, it's perpetuating the drug cycle in the United States and globally. I don't want this perpetuated. And so I guess I'll just kind of take that stance, which is, 'Uch, I don't want to be a part of that. I don't want to be a part of that.'

Russ Roberts: Yeah. I understand that. I mean, I'll--let me go the other extreme. I don't think I have a drinking problem. Okay? I could be wrong, of course. Some people find--one of the ways you find out somebody has a drinking problem is they don't think they do. But I have, maybe, oh, might have 2 or 3 scotches a week, shots of scotch. Might be 2. Some weeks it's 1. Probably there are some weeks that it's 4. And an occasional, once in a while I have a scotch. And it gives me a lot of pleasure. I like the taste of it; it makes me feel good. And that's really the limit of my recreational drug habit, other than NyQuil, which I took last night because I've got a cold. So, I'm kind of a--not a very interesting case. But I feel a little bit awkward telling a person on the street that those pleasures--even when they are destructive--are not for you. I'll give you a hamburger, or a sprout or a broccoli tree, but you can't drink on my nickel. And you can't use drugs on my nickel. Now, I understand the reality is, is that some people's lives are ruined by drugs. Some people's lives are ruined by alcohol. And it could be those are the people I'm giving a dollar to. Or sometimes it's a quarter. I understand that a quarter of dollar is not a life-changing event. It's never going to be part of a long-term solution. We're going to get to some of those in a little bit--which I think is really wonderful, the longer-term ones. But for when I'm just walking by--to me--and I understand there's a little bit of illusion here--but to me, I'm treating this person before me with the utmost dignity. Which is something that may be lost. They are sleeping on the street. And I'm saying to them, when I give them my cash, which I give them freely to spend as they see fit, 'I recognize your dignity as a fellow human being. I am not going to let you--I am not going to treat you as a child. I am going to give you the freedom to spend this gift as you see fit.' Even if it's not how I would want that person to spend it. So, that's my position. You push back against it.

Erica Sandberg: Okay. Well, I think it's definitely the kind position. And it's the empathetic position, as well.

Russ Roberts: I know you heard the Paul Bloom episode as well--

Erica Sandberg: I do. I loved it. And it was very impactful. And I have to say, I am not above or below giving money every once in a long while. And you asked about my daughter and about raising a child, in this atmosphere. And I will do it so carefully. If somebody is playing an instrument, or telling a joke--I want to reward behavior. Which sounds so pedantic. Like, you know, I'm the parent and I'm rewarding--it's not that. It's, 'Hey, you are doing something. You are making an effort. I love effort.'

Russ Roberts: Me, too.

Erica Sandberg: So, in those circumstances I'm much more motivated to give. But I'm always--and this is something that you could do without giving and maybe having a potential harm. Which is, like, the downtown streets, you might never going to get to it. But, just say, 'Hi.' It's that--you're human, I'm human, I'm saying 'Hi.' Fabulous. I do it all the time. And it can create kind of a shock. But it's great. It's free. It's never bad. It's always good.

Russ Roberts: Yeah, that's for sure.

Erica Sandberg: And--


Russ Roberts: But it's a little bit scary. You know, it's interesting. There are times I've probably given money and looked away. I try not to. I try to look the person in the eye and say--with--as if that's a great human contact. It's some human contact. It's not very impressive, actually, right? But it's better than, 'I can't look at you. Here's some money to assuage my conscience.'

Erica Sandberg: Definitely. I'm going to tell you a quick story here. In San Francisco, we've got some major tense cities. This is pervasive. [?] Chicago, so many. And, the news went down there most recently to one of them. And the guys were begging. They said, 'Please don't drop off your food any more.' What it's doing is that it's wrecking havoc on these tent cities--on the breadth[?] of them, people who live there. Rats have taken over. Bugs have come into the tent cities. And so--but people will come and they will drop off a case of mangoes, or sandwiches. And they'll sit in the sun. And people are too scared to get out of the car so they'll just kind of drop them off and run away. And this is--it's a do-gooder gone bad. And this is--it's a do-gooder gone bad. It doesn't make any sense. It's not helping. But it helps that person, who thinks [?]. But it is that sort of give and run away, or smile and run away approach, which really doesn't help.


Russ Roberts: I just want to finish up though on this article you wrote. What are some of the issues? You are trying to literally just give people--government officials or offices they could call under certain types of situations that occur on the street. And I just say in passing, some of this problem--to the extent it's a problem, but some of this problem is the fact that the city streets are public. In the literal sense of the word. They are not owned. They are not--you know, if I have an office building and you set up a folding chair in my lobby and decide to use it as your office I can ask you to leave; and if you refuse I can call the police and say you are trespassing, and have you removed. On the street, it's kind of 'Our Street.' It's no one's street. And at the same time, there are certain behaviors that are not allowed. And yet, there are people doing them, and we often just turn an eye to them and we don't look. We try not to look, or we ignore it. So, what kind of things were you worrying about? And how can people with, in that article?

Erica Sandberg: Okay. Yeah. Definitely. The list of behaviors that I described in the piece was unconscious people. You see somebody who is passed out, seemingly asleep--we don't know. You don't know what's going on. Make an effort, definitely--we have a 311-app here. And you could also call, report it. Get somebody down there that will help check on them. It's really important. If you see drug dealing or intoxication, guess what? It's illegal. You can call the police and get somebody out there. Do something. Same goes with the erratic or threatening activity that you see. This is something that's terrifying to kids. As a family, or visitors to this city, they'll see people bashing into buildings or screaming at the top of their lungs--

Russ Roberts: or cursing--

Erica Sandberg: Cursing. Sometimes saying extremely racist--

Russ Roberts: Creepy--

Erica Sandberg: Right. Exactly. And you don't know what to do. Well, that's a threatening behavior that's also police action that you need to take. Aggressive panhandling: You are allowed to ask for money. Nothing wrong with that. You can do it. But, when it comes to being followed or being harangued or, a lot of times they'll kind of block, oftentimes, tourists--and won't let them go before they get something, or they'll push a street sheet in their hand or some other product. You know, again--nudity: for some reason, we have a big problem with nudity here. People just take off their clothes. And that is a drug issue very often. Bathrooming--just relieving themselves on the sidewalk or the street right in front of you--happens all the time.


Russ Roberts: So, I have to say, you know, it's a weird thing. It's kind of my libertarian streak, which can be quite strong, especially my idea of minding my own business. There's something heroic and courageous about the fact--and also tragic, and also crazy--about just ignoring that stuff. I understand it's illegal. A lot of those things are literally illegal, or borderline illegal. And part of me just says, 'This person has a horrible life.' They are cursing or they are relieving themselves in public, which is tragic and unpleasant. And I just sort of think, 'It's not my business' in the sense that I don't want them to fall in the hands of someone. If they want help, I'd like them to get it. But I often feel that we don't help them very well. Now, that may be a bit naive or, I don't know--maybe that's just making me feel comfortable by ignoring the behavior. But it's not obvious to me that--I'll say it a different way. Let me try to say it in a more dramatic way. Until about 1980, we locked all these people up. We said, 'You're not normal.' And a lot of them aren't. And we said, 'You're mentally ill'--which is a phrase that has some clinical meaning, but not always. 'You make people uncomfortable' is what it often meant: 'You're not normal.' And 'We're going to put you in an institution; and we're often going to do stuff to you. Like shock treatments, and drugs and other things that you don't want, because we recognize that you are not normal and we want to make you normal.' And we're not very good at that, it turns out. We're not very good at making people normal. So, a part of me says, this is a human tragedy but we are not very good at helping these folks and in particular the ways we try to help them If you went up to these folks and said, some of the people you are talking about, and said, 'Can I get you help?' they would not want to talk to you. Now, that could be for a lot of reasons, obviously. I don't know. What are your thoughts on that?

Erica Sandberg: I think you are absolutely correct. And I think it would be horrible if we began to institutionalize people just because they are a little off. That's a travesty. We don't want to head in that direction. But it's so interesting, because I keep hearing the word 'help.' 'Help, help, help.' We want to help. And I want, kind of almost the opposite. Which is: I want them to help us. The more you give to somebody--and I know we're going to go into this a little bit--the more you are--if you are constantly in the position where somebody is giving to you and trying to help you, you feel--I firmly believe this--you feel less than human. You feel unnecessary, unneeded, in the way, like a burden; and somebody's taken pity on you. What does that do to you? And you could be as sane as sane can be. Or completely out of it. To me, it's going to have the same effect. Which is: You are not worth anything. What your worth is, you are worth somebody kind of throwing a pittance at you. Or, that you just desperately need help. I love the opposite. How can you help the world? What can you do? What skills do you have? What passions do you have? Um, even somebody who has been curled up in a corner of an alleyway, they've got something. They do. They had to. At some stage in their life, they had something. And I think that's really--that's where the answer, to me, lies: drawing that out--

Russ Roberts: Okay. We're going to turn to that.

Erica Sandberg: It sounds really--yeah. Good. Okay.


Russ Roberts: Yeah, we'll turn to that. I just want to--agree with you. It's interesting how unpopular your view is these days, that dignity--it's difficult to have dignity if you are only taking and not giving. I think there's a lot of--for a variety of reasons I think people don't like that argument any more. I think it was the common argument for about 3000 years or so--maybe 2500--that if you are merely taking then it's hard to be dignified. And that that's not much of a solution. So, I'm going to half-agree with you. I certainly agree that it's the first half, the out-of-date, the ancient part, I agree with you that, even though it's out of fashion I think that people who don't produce or give and who only take have trouble maintaining their dignity. I think that's true. But it's not popular, that view. But the part I disagree with a little bit, maybe, is, I think in that state I'd rather help them a little bit and assuage some of that pain if I could with money. But I certainly accept the fact that it's not a long-run solution. So, let's talk about what is possible, that's actually truly helpful. Which is this organization you've gotten involved with called the Downtown Streets Team. What do they do? What's their approach?

Erica Sandberg: Yeah. The approach is, well, the mission is to get aid through work. And it's sort of this revolutionary/non-revolutionary program--in fact, there are a few programs throughout the United States which have that same model, which is: Offer work. Just offer--and so this particular organization, what they do is they have these Tuesday meetings. Any homeless person can come. You could be in the worst state imaginable. But, just come. Just sit in the meeting; and enroll. All you have to do is put your name down, and you will be given, very quickly, a broom, a brush, some mops--whatever--to work on city beautification programs. And in exchange you get a gift card that has, that you can buy essentials with--food, and toothpaste, and that type of thing. So, it's cut through this bureaucratic junk that you have to go through in order to get a shelter bed or financial assistance or whatever. All you do is you work. You work on these programs, and you go out to the Civic Center, or to Union Square area. And it's a symbiotic relationship. The city gains because the streets are nicer. The people gain because they are actually working and earning something. And they--the response is overwhelming. And the members become almost evangelical in this, in bringing other homeless people to this, to these meetings. And it's remarkable. It's very similar--I feel like I'm in this, um, kind of a religious revival meeting with people who were involved: Homeless people--you've got to come! You've got to start! This is what I'm doing! And the pride--it'll bring tears to your eyes. And that is to me where the magic happens. And so, why this is in any way a bad thing--the people can criticize; I don't get it. And by the way, the article that I wrote: Oh, the hate mail. Oh, my gosh. It was off the charts. So, even an alternative program like this can kind of result in eyes[?]: 'Are you serious? Really? We are going to ask them to work?' 'Hey, it's not me! It's them. They want to!' And it's really effective.

Russ Roberts: Well, it's a voluntary program--

Erica Sandberg: Absolutely. Nobody's shoving it in their hands. They're doing it. And they bring other people involved, to the team. So, it's really--I'm such a huge advocate for it. But there's others throughout the country that do very similar programs. And it really is quite remarkable. It's beautiful.

Russ Roberts: So, what's the--give us some idea what the magnitudes are here, just a couple of different dimensions to talk about. So, on a particular Tuesday, how many people might show up? What's an average or rough idea? Is it 4 people? Is it 40?

Erica Sandberg: It's about, I'd say, anywhere between 50 and 100.

Russ Roberts: And there's different ones all around the Bay area: there's one--right? They're not just in San Francisco. But you are talking about the San Francisco one.

Erica Sandberg: I am. And this started in the South Bay. But, you know, it's a model that could be recreated anywhere. It's so simple. You know: Do you want just streets cleaned? Great. You know, where are we going to get the funding? Very often it's like a business district that will provide the funding. And then, offer it up. You want to do it? Great! You can start. And the people who do get involved, the members, they get a case worker. So they get started. And then I jump in, and I help with their credit problems and their money problems, because guess what? They had a life before this. Almost all of them had something that happened. And so, they do actually have, maybe sometimes some credit issues, or some money questions that they need answering. So, it just becomes a step-up program. Very exciting. And, whatever: whether it's this program or some other program that's doing the same thing, it's not a, 'Ooo, let's help the homeless and kind of pat them on the head and shove them along.' It's, 'This is real.'


Russ Roberts: Let's talk about that. So, how does the organization--there's two issues I want to get a better feel for. One is, if I hand you a broom and say, 'Go sweep somewhere,' you know, is there any supervision? Is there any follow-up to say the person did a good job or not? And then the other question I had is: How much money is on the gift card? Is it--and is it one day of work? Is it that Tuesday? Do they work all week? Do they show up multiple days? Can you give us a feel for that?

Erica Sandberg: Sure. No, they work in teams. There is a supervisor. And the supervisor is usually somebody who has been through the program before. And who is just making sure--are you there on time, what are you--you just going to chit-chat? Are you actually sweeping or removing graffiti? And almost everybody follows through. In fact, there's even a blind guy. He's been blind from Day 1. And he's sweeping. He's working with somebody who is telling him where to sweep. Because it's very--very often the idea is, it's not what they're actually doing, but they're doing it. So, they go through that. And then, after a few weeks of being on time, being committed to the program, then they start to build a resumé, and the case workers can help them get real jobs and real housing.

Russ Roberts: Is the only--let's got back to how much money do they get. And how frequently--you know, my view, this classic story which I--it's easy to make fun of but I actually like it a lot, and I may have told it on the air before; I apologize. But the story is the little girl who is tossing the beach starfish back into the water. And the person comes along and says, 'What are you doing?' 'Well, I'm helping the starfish'--and--versus there's hundreds of thousands of them. And the person says, 'Well, you're never going to make a difference. Look how many there are.' And the person, or whoever picks up the starfish picks it up, puts it back in the water, and says, 'It made a difference to that one.' So, I don't want to undersell anything that makes one person's life better. That would be great. But do you have any feel for whether there's like, once, someone actually moved from this program to normal work? Or is it a few dozen? Do we have--what kind of follow-up is happening? So, tell us about the amounts of money in the gift card, if you know. And then, sort of the kind of success rate this has. And again, I want to emphasize: Someone working and feeling good about themselves, if that's actually what it does, is great. So, to me, success has a lot of different dimensions.

Erica Sandberg: Yeah. Well, it's only a couple hundred dollars on the gift card. And they get paid out once--they get their gift card once a week. So, it's, but it's money they've earned. So, it feels different. And the success rate--well, people do tend to stay with it. It's a relatively new program. But I've seen with my own eyes. I was walking down the street the other day and I saw this guy--his name is Moses--young guy, something was off about him. I can't really tell what his situation was. But he's now working as a city worker. So, he's got a city job. Which, by the way, pays quite well and has very good benefits. And so I said, 'Oh my gosh! What are you doing?' And he goes, 'Well, I've got a full-time job now.' I had just seen him about a month previous to that, where he was doing what he was doing. He was sweeping up the streets, with Downtown Streets Team.

Russ Roberts: Do they recruit folks actively, or do they only rely on word of mouth? One of the interesting--in other words, it would be an interesting model to think about putting, besides giving somebody a dollar, giving them a card that has the contact information or the location on for the Tuesday morning meeting. How do they reach out to the homeless? Or do they just use word of mouth?

Erica Sandberg: At this stage it's just word of mouth, and we've just recently started this idea where we would publish, we would have postcards, we would give to people and say, 'Pleeease you may want to check this out. It's not too far. It's like right in the heart of the bad area of town, anyway. You are going to be there. So, head on over. There's donuts. There's coffee. Go can go do it.' And they get it, gosh it really does, as they say, almost have a religious overtone. Like, 'Just show up at the meeting.'

Russ Roberts: Well, historically--go ahead. Sorry.

Erica Sandberg: Say, it has that tone, almost, but without the--there's zero religious involvement.

Russ Roberts: I was going to say, historically, religious organizations often did a quid pro quo: You come to our meeting and get a dose of our religion and then we'll either feed you or give you some work, whatever it is. But this is a purely secular organization, correct?

Erica Sandberg: Totally secular. Yeah. And it's run by these young, enthusiastic people who just leave me breathless. And they, they do good work. But again, Russ, this is just one program. There's others. There's one in Chicago where they'll pull up and they'll offer people work. In fact, a journalist who I just recently communicated with out of Chicago, from the Sun--you know, he wrote about Safe Haven Foundation where they drive around and they offer panhandlers a chance to work. 'There you go. Do it. If you want to do it, we'll have it for you.' And that's the kind of thing that's so exciting.

Russ Roberts: How do they interact with city government, the organization? So, there's two issues that come to mind. One is, the city has people who sweep the streets, obviously, and people litter, and clean graffiti up. They may not do the best job; they may do a great job. But there's a question of how--obviously, to me--I don't know if everybody would agree with me--but to me, the more real work you can offer a person that's actually changing something, the more dignity you give them in return--as opposed to just pretending that they are doing something and giving them money in return. So, do you know how that works? How they interact with tasks that are somewhat already covered?

Erica Sandberg: Yeah. Here, it's side by side. So, one doesn't interact with the other. They just sort of do their thing. We have, obviously, city workers who are supposed to come and remove graffiti. But you could wait several weeks before that actually happens. Downtown Streets Team, they will be on it. It's right there. So, it's really kind of exciting. Now, is it going to displace city workers? I don't know. Nor do I care.


Russ Roberts: So, there's a case in the article that we were talking about where there was a flower stand that was abandonded--was being used as a place for people to take drugs, hang out and sleep or whatever. And the city can't do anything about it, for reasons that I can't fully understand. Because it's abandonded. But for some reason, it's got some protected status now, like, I don't know. But I'm curious if there are things that--I would think that the Downtown Streets Team folks are kind of operating in a little bit of a gray area, maybe, and do things that maybe a city worker wouldn't do. I don't know. Does that make any sense?

Erica Sandberg: Yes. It does. And it's funny you brought up the flower stand issue. [More to come, 37: 37]

COMMENTS (20 to date)
D writes:

No mention of bankruptcy just debt restructuring. Consolidation of debt is often the wrong thing to do when bankruptcy is a viable alternative. Is she a credit card co. plant? Who pays her? Or is she doing all this out of the goodness of her heart?
Society would benefit from stepping back and understanding how these folks came to live on the streets.

Luke J writes:

Good stuff.

Max Ghenis writes:

This was an infomercial, not an economics podcast. Where's the discussion of evidence? Is this program effective on any metric? Do homeless people actually blow all their money on drugs and alcohol? If so wouldn't they sell the gift card for cash to continue doing so? Otherwise this just seems like a minimum wage loophole for the city and retailers. There was not a single data point mentioned. Most disappointing Econtalk I've heard by far.

Steven B writes:

I love Econtalk, but this episode missed the mark. The guest didn't seem like she had a grasp of the issue or the context of the contributing factors that lead to homelessness. Disappointing.

Jonathan K writes:

Gee, what a great idea! Eliminate the requirements that employers pay payroll taxes, withhold payroll taxes from pay, pay the minimum wage, obtain and pay workers comp insurance, assume liability for employee's acts, make extensive wage and employment reports to multiple levels of government, and all of a sudden people with no proven reliability or skills can enter the job market. I wonder if anyone could come up with a business model or two that would work under that scenario?!

Roman Lombardi writes:

This was an interesting episode. It very much confirms my hunch that the proverbial "lines" that need to be crossed for me to personally intervene are very different than most others. I just never feel compelled to help the homeless, not because I don't care, but because it isn't my problem. Sure, I've given a dollar, or $5 sometimes, but in my view there isn't much I can really do (or am WILLING to do maybe).

A bit of research on the guest was revealing. She is basically a Nob Hill resident who is fed up with homeless people sleeping in the streets of her very affluent neighborhood. To her credit, she has some personal finance knowledge and the financial firepower to volunteer her time and expertise. A noble and worthy endeavor to be sure; one that should be applauded.

For my entire lifetime, the city I grew up in (Portland, OR) has continually spent millions of dollars to "end homelessness" Interestingly, There are more homeless people in Portland than ever before. Homeless camps are EVERYWHERE. It is impossible to walk the streets of Portland without being accosted by homeless people begging. Whatever is being done isn't working.

I am reminded of the John Wooden quote, "The worst things you can do for the people you love are the things that they could do and should do for themselves"

Sadly, homelessness advocacy has become a growth industry. Is it possible that well-intentioned interventions are actually making the problem worse? It wouldn't be the first time.

Erica Sandberg writes:

Fantastic to be on the podcast discussing this topic, Russ. My aim is to identify and promote unique solutions to a growing problem that most cities in the U.S. are grappling with. I agree with you, Roman. What has been done (and continues to be done) is failing. Local governments tend to throw money at it, hard and fast, with little regard for true efficacy. This way city leaders get to say, "see, we're doing something!" and homeless advocates remain in business. Meanwhile an increasing number of people are living on the streets. It's an appalling situation.

Why so many people descend into homelessness is another story - and one worth telling. Another day.

I welcome creative suggestions and discourse. Know of a program that's really working? Hit me. I've just been asked to lead the SFPD community board specifically to tackle homeless issues as they pertain to residents and merchants. It will be interesting. I'm hardly a political animal and have no aspiration to be one.

Joseph writes:

It would have been nice if the guest included statistical data to back her claims. I live in Seattle and have heard that we too have a homeless problem here.

Yousef Balahmar writes:

This was poor, unfortunately.

There is a different story for each homeless person and it's probably best to study how people elevate themselves from homelessness. It is extremely difficult to be a productive member of society as a homeless person precisely due to being homeless.

I'm assuming not everyone wants to be homeless. Unfortunately some of us are handed a better set of cards than others. Maybe we have a family that helps during our struggles for instance. Elevating from being homeless to having a full time job is something I never want to experience because it must be extremely difficult.

Hats off for trying to create help. I still believe government has a role to play in creating a safety net that allows them to live and choose their direction from the funds.

Tom Coss writes:

I cannot help but wonder if the same outcomes Erica finds so exciting, legitimately so, couldn't be accomplished by simply removing minimum wage.

As long as those they are helping remain minimally employed, all will be good, but should their efforts begin crowding out city workers there will be a conversation. The lesson I heard here is that you can help people efficiently providing you can compensate them below minimum wage and without FICA, Disability and income taxes.

Am I missing anything?

Great interview,

David Zetland writes:

Swap "homeless" for "aid recipient" and you've got a good description of why international aid fails and "work dignity" is the way to go.

Check out this film:

Greg G writes:

I'm surprised this episode isn't getting more love.

Erica is doing exactly what libertarians always say they want people to do to solve social problems they think need solving. She is spending her own time and money to address it without requiring anything from anyone else.

Hats off to her as far as I'm concerned.

Jerm writes:

From Jonathan K:

Gee, what a great idea! Eliminate the requirements that employers pay payroll taxes, withhold payroll taxes from pay, pay the minimum wage, obtain and pay workers comp insurance, assume liability for employee's acts, make extensive wage and employment reports to multiple levels of government, and all of a sudden people with no proven reliability or skills can enter the job market. I wonder if anyone could come up with a business model or two that would work under that scenario?!

That business is called Uber, right?

Like Greg, I'm surprised that this isn't being embraced by the EconTalk community. Maybe if they were paid in bitcoin instead.

A.G.McDowell writes:

I wholeheartedly agree with the request for statistical data to back this up. This is an area where it would be easy to be overwhelmed with emotion, and the core skills of the speaker appear to be getting people to agree with her and working round inconvenient regulations. Hard objective data and comparisons with other approaches would make it easier to approach this important problem in a way which would lead us to an answer which actually was right, as opposed to an answer which would make us feel good.

erica sandberg writes:

Methods that address the homeless situation in creative ways, such as the Bay Area's Downtown Streets Team and the Jobs Project in Chicago are so new that the longterm impact has yet to be discovered. However, the ideology behind these programs is noble -- and definitely helping some become self-sufficient. Can you imagine not ever being needed but instead always being a burden? It's corrosive; horrible. As humans, we need a purpose. Over and over again, I hear from people living on the streets that they feel invisible, unnecessary. When they get back to work there is a recalibration. A sense of "wow, I'm part of society in a positive way again (or maybe for the first time)" And the community benefits, too.

I've received so many comments, positive and negative; funny and sad; and many personal accounts -- thank you. I love the discourse! And thank you Russ, for bringing this issue to light.

Jason C writes:

Love the topic and the guest seemed very passionate about what she does, but unfortunately I have to agree with many other posters thinking this was not your best episode.

I would have also liked to hear some real data, a cursory look at the "Downtown Streets" website shows they have placed 599 in employment and 670 have been housed. Also of those employed from their program 74.8% keep their job for 90 days which is 5 times the national best practice average of 14%. However they give no reference for these numbers.

Also they have been around since 2005. Since their inception that would be an average of about 116 per year if you take the total number helped divided by 11 years.

According to page 18 of the report linked below, in 2015 alone San Francisco had 6,686 homeless persons.

Downtown streets are in 7 cities including San Francisco, and while the work they have done and the difference made for those 1269 individuals is extremely important it does not sound like a very large amount in the grand scheme.

In addition to all of this, it sounds like there is potentially growth limitations as they are a charity currently depending on donations and volunteers hours. You touched on scalability and I felt it was just glossed over, also there was no information on what the total cost per individual helped was, how big of a budget they have, major challenges they face, how they record their data, etc... In addition they are not yet rated on charity navigator, although you can get Asset and Income amount there."

Now with all that being said, I do applaud anyone trying to genuinely improve the lives of our homeless, and can relate to the frustrations of bureaucratic red tape, but for your podcast I have higher expectations. Their program may actually be cost efficient and scalable, but there was nothing I heard that made me believe that.

Finally, I just wanted to say compared to previous work you have done with say hard questioning (appropriately so) of Jeffery Sach's program in Africa, it seemed like Erica got a free pass.

Eric writes:

This was yet another great episode. I'm glad Russ brought Erica Sandberg on to talk about this approach -- which turns out to be a needed rediscovery of principles that were once more commonly affirmed.

Anyone interested in the importance of work may wish to check out the research Arthur C. Brooks has done regarding the critical importance of earned success to happiness and a sense of fulfillment.

He has much to say about this in his books. For a quick insight, here is a short 4.5 minute video in which he talks about earned success.

The Promise of Free Enterprise
Jun 9, 2014
Presented by ARTHUR BROOKS

Brooks also mentions earned success in parts of his other two short videos at the same site.

I mentioned that this is a rediscovered principle. The cultural understanding in America was quite different before government became the dominant player through trying to help people by giving them unearned money and benefits.

For those who are curious about the perspective of earlier days concerning giving and work, I would suggest this article as a possible starting point.

Giving that worked
by Marvin Olasky
March 14, 2009

I hope that many are encouraged and inspired by what Erica Sandberg and others with her have been creatively exploring and rediscovering!

Spencer Wright writes:

I really like this show, as it always has a good mix of presenting various view points and pushing back as appropriate.

This is probably the worst episode of this podcast I have listened to, as there was hardly any push back on the guest or downsides of the program discussed at all.

The most striking example would probably be the remark about the guest not caring if any city workers are displaced, when she previously mentioned the success story of an individual who was able to work his way up to a decent well paid city job.

Jared Szymanski writes:

This sounds like the kind of charitable organization that deserves money from people who want to help the homeless. I have to take Russ to task for giving money directly to the homeless because there is a negative externality associated with that. I actually get angry when I see people giving money like that because it encourages panhandling and nobody likes to see streets crowded with panhandlers. Save your money, give the panhandlers a nod and a smile and send a check to an organization like Downtown Streets if you really want to help out and feel good.

Kevin writes:

I applaud the guests efforts to directly make a difference in another persons life. This deserves lots of praise because we live in a tough world and being willing to help a fellow human whether they caused their misery or not is noble.

I do not think these are programs that new. Different Christians and other groups have had various programs forever in different forms. Although they don't get to proclaim with joy- "its totally secular!"

No data was presented, but since no government money (my money) is spent who cares what people do with their own money and time. The program itself and those who fund it are probably the most interested in the outcomes since their skin is in the game.

We don't commit people with psyche disorders at the rate we used to because of a court case AND the introduction of oral anti-psychotics that work well with far less side effects.

I was disappointed on Dr. Roberts opining on the pleasure he derives from scotch and not wanting to deprive the poor from the same. Having worked with homeless addicted to alcohol, pleasure is the last thing on their minds. Many of them, if they don't drink they begin having seizures and can end up dead or in the hospital. Most people homeless and addicted are filled with shame concerning their addictions and don't view it as a pleasure any more than anyone suffering from an out of control life does. There is paternalistic wanting to control the poor, and then there is understanding their misery and realizing the thing that brings you pleasure brings them personally sorrow and destruction. Different worlds and uses for vices.


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