Former Soros Activist Explains How Progressive Policies Ruined San Francisco

There’s a crisis in San Francisco. Homelessness has skyrocketed and drug use is rampant. 

Michael Shellenberger moved to San Francisco in 1993 to work on liberal causes, and even spent time working for George Soros’ foundation. He advocated the decriminalization of drugs and promoted drug treatment programs. But, Shellenberger says, he began to worry when he saw the number of drug overdose deaths in America rise from 17,000 in 2000 to more than 70,000 by 2017. 

“Clearly, we are in the midst of a massive drug crisis,” Shellenberger says, “and it felt like nobody was offering a particularly clear explanation of it or offering very good solutions.” 

Out of frustration over the problems he was seeing in San Francisco and other liberal cities, Shellenberger became determined to diagnose the problems driving the homeless crisis and find solutions. He presents the result of his research and investigation in his new book “San Fransicko: Why Progressives Ruin Cities.” 

Shellenberger joins “The Daily Signal Podcast” to discuss how the left’s “victim” ideology has harmed West Coast cities and what can be done to save those communities from complete ruin. 

We also cover these stories: 

  • The Ohio School Boards Association ends its formal relationship with the National School Boards Association over the national group’s letter associating irate activist parents with “domestic terrorism.” 
  • Republican members of the House Judiciary Committee ask Attorney General Merrick Garland to withdraw his memo directing the FBI and Justice Department to investigate incidents involving aggrieved parents and local school boards.
  • Biological males no longer are allowed to compete on women’s scholastic sports teams in Texas.

Listen to the podcast below or read the lightly edited transcript.

Virginia Allen: I am so pleased to welcome Michael Shellenberger to “The Daily Signal Podcast.” Michael is the author of the new book “San Fransicko: Why Progressives Ruin Cities.” Michael, thanks so much for being here, and congratulations on the new book.

Michael Shellenberger: Thanks for having me. It’s a pleasure to be here.

Allen: Now, you have lived and worked in San Francisco for a really long time. Explain why you wrote this book. You do not mince words in the title, “San Fransicko.” What is the mission behind this book?

Shellenberger: Sure. Well, I wrote this book because I love San Francisco. I moved to San Francisco in 1993 after graduating from college. I moved to San Francisco to work on progressive causes, radical left causes. I’m best known for my work on the environment, in particular around nuclear energy, which I’ve been focused on for the last 20 years.

But in the late 1990s, I worked for a number of George Soros-funded nonprofits. I worked for George Soros’ foundation to advocate to decriminalize drugs, promote drug treatment, promote harm reduction, including the exchange of clean needles for dirty ones, worked with Maxine Waters from Los Angeles to organize civil rights leaders in support of needle exchange. And as drug overdose deaths rose from 17,000 in the year 2000 to over 70,000 by 2017, I started to worry.

This is an issue that I have always cared a lot about, even if I hadn’t worked on it very much in the last couple decades. My aunt had schizophrenia. My parents are psychologists. I live in the Bay Area. I live in Berkeley, across the bay from San Francisco. I’m still, in many ways, a bleeding-heart liberal. I’m a very sensitive person, really bothers me to see the suffering of people that are obviously suffering from drug addiction or mental illness or some combination of the two.

I wrote a couple of pieces for Forbes in 2019. The first one I wrote was around the contribution of housing to homelessness, but then after I wrote that, a number of friends were like, “Look, you have to consider drug addiction and mental illness.” I was like, “Yeah, of course.” I knew that was a big part of it. And I read a lot more about it and learned that a lot of the things I believed were wrong.

One of the things, when you interview progressives still to this day, and I discovered this quite a bit in my research, they blame [Ronald] Reagan, first as governor in the 1960s and then as president, for the homeless crisis, even though progressives have controlled California for decades. Democrats have a supermajority in Congress. We spend more than any other state per capita on homelessness and mental illness, and we have the worst outcomes.

So I wanted to write “San Fransicko” to both get to the bottom of what’s really going on and also figure out what the solutions are because, obviously, we’re dealing with a catastrophe. I mentioned drug overdose deaths rose from 17,000 to 70,000 by 2017. Last year, drug deaths were 93,000, which is almost three times as many people than die from car accidents and four times as many people as die from homicide. Clearly, we are in the midst of a massive drug crisis, and it felt like nobody was offering a particularly clear explanation of it or offering very good solutions.

Allen: I love that curiosity and that drive to say, “OK, there’s obviously an issue here, and we actually need to find a solution.” You’re asking the hard questions. That’s something we really need more of. Now, Michael, for those who have not been to San Francisco, for those who are not too familiar maybe with the situation there, if you were to leave your house, cross the bay, and walk through the streets of San Francisco, give us a picture of what we would see.

Shellenberger: Sure. San Francisco remains one of the most spectacularly beautiful cities in the world. Just driving across the Bay Bridge into San Francisco, its skyline is stunning; three major bridges into San Francisco, incredible skyline, beautiful, surrounded by water, humpback whales not far from the coast.

But as soon as you drive downtown, you see tents. You see what are euphemistically called homeless encampments, but they are more accurately described as open drug scenes. That’s the expression that’s used by European researchers. I point out that the Europeans dealt with this exact same problem in the 1980s in places like Zurich, Switzerland; Amsterdam, Netherlands; Lisbon, Portugal; Frankfurt, Germany.

What you find is just these are people that are living on the street. They’re living on the street because … almost all of them, if not really all of them, are suffering from severe drug addiction, severe drug and alcohol addiction.

In the 1980s, what we called homelessness—I point out in the book that homelessness is a propaganda word. It was designed to mislead people about what’s really going on. It was designed by progressives to mislead people into thinking that people live on the street because they can’t afford the rent. That’s not the case. The people on the street, we know, are there because of addiction and untreated mental illness.

Look, there’s some people that think that all addiction is a consequence of untreated mental illness. I’m not sure I would go that far, but clearly a significant percentage of people on the street are suffering from some sort of mental illness, whether severe, like schizophrenia, or just untreated depression.

You see people openly using drugs, smoking fentanyl, which is responsible for about half of the drug deaths, people defecating in public. It’s very common to see that. You see just a lot of tents, hundreds of people.

San Francisco officially has about 5,000 unsheltered homeless, meaning people that are not in shelters. But on the streets are actually thousands more because a lot of the people on the streets using drugs are people that may have a shelter. They may have an apartment or a single-resident occupancy room, but are still living on the streets.

So that’s what you see. It looks like what we think a Third World country looks like. I’m somebody that’s spent a fair amount of time in Brazil, in Africa, in India. I go to slums every time I go to developing and poor countries. This is different in the sense that, obviously, San Francisco is one of the richest cities in the world. The number of billionaires per capita is huge. It’s obviously the center of much of our technology boom.

The drug crisis is the result of deliberate policies that are imposed by progressives, demanded by progressives, to not treat addiction, not treat mental illness, and to basically defend the right of people to sleep anywhere, defecate anywhere, and not be arrested, not be mandated treatment.

Allen: OK. So I know you dive really deeply into this in the book, in “San Fransicko.” I’ll hold it up. Excellent read.

Shellenberger: Thank you.

Allen: Encourage all of our listeners to pick up a copy—Amazon, Barnes & Noble.

But talk a little bit more about the policies. What do you mean by policies led to this? How have we gotten to this moment in San Francisco where there are literally, like you say, now these encampments and individuals openly using drugs, and no one is stepping in to stop them?

Shellenberger: Yeah. There’s so many levels to pick on. This is why I really required a whole book. I told people, even after three hours with Joe Rogan, it still didn’t cover all of it. But at the very simplest level, you do not need to have anybody living on the street if you just build enough shelters and require people to use them. That’s what most developed and civilized cities around the world have done. Before the pandemic, New York basically sheltered 99% of its homeless.

The reason that we have so many people unsheltered living on the street in California is because the progressives have opposed building sufficient shelters and requiring people to use them.

So at the simplest level, it’s just that. It’s just that we have had what’s called a “housing first” policy rather than a “shelter first” policy. Housing first, of course, meaning this idea that anybody who wants their own apartment should be able to get one. It’s completely ludicrous. Even if you are a socialist, even if you’re radical left, it doesn’t make any sense. You can’t provide that much apartments and housing for people.

First of all, you just can’t build it in San Francisco because there’s so much NIMBYism, and the regulations are so strict against building housing. But also, there’s just not the money for it. You can’t just provide free apartments for everybody. That may seem more obvious to listeners of Heritage Foundation than listeners to MSNBC, but it’s just the fact of the matter.

Then you go back further and you go, what is the history of untreated mental illness and addiction? San Francisco is a city that has always tolerated much more extensive alcohol and drug use than other cities, more bars than churches for its entire founding. It was the last city to ban opium dens in the 19th century. It obviously was the epicenter of the new drug culture in the 1960s, which introduced, most famously, marijuana and psychedelics, but much more insidiously, heroin and amphetamines. Those things have only gotten worse.

The deinstitutionalization of psychiatric hospitals, the closure of psychiatric hospitals begins after World War II. It accelerates under President John Kennedy. … It was progressives who led the charge to empty the mental hospitals. The promise was we would have community-based care. That was never built.

It’s something that progressives blame Reagan for as governor, but the truth is that half of the people in psychiatric hospitals had already been released by the time Reagan became governor. It’s one of the many things I debunk in the book. I also debunked the claim that Reagan slashed the federal budget for housing. In fact, the federal budget for housing was basically steady during Reagan’s years in office.

At the same time, by the way, I should add, I do make a critique of Republicans and conservatives in the book. At the end, I argue that Republicans and conservatives have not offered a proper urban policy. … Republicans and conservatives tend to be more suburban and rural, and they don’t care as much about the cities. They tend to look down on the cities, so they haven’t engaged in the cities. I extend that criticism at the end. But nonetheless, it’s wrong to blame Reagan and Republicans for what’s happened in San Francisco.

What you basically have is massive untreated mental illness, including severe mental illness. You have the ACLU, which I think in many other contexts has done good things, I have been a longtime supporter of ACLU, but in this case, we have the ACLU irrationally defending leaving people with schizophrenia on the street, in states of psychosis, using hard drugs, living in totally unsafe, unsanitary conditions; having a complete double standard when it comes to requiring people with dementia, for example, our grandparents who suffer from dementia, either from Alzheimer’s or something else, we don’t let grandma and grandpa wander onto the streets, and yet we allow people in psychotic states to do that. They use a double standard to justify it.

What I get at, the bottom line here, is that this is a victim ideology, meaning that there’s an ideology here. And it’s just as dumb as it sounds, unfortunately. It’s the idea that you can classify certain groups of people as victims.

The racist aspect of this is that progressives classify all African Americans, all people of color, except for Asians, as victims. But they also classify people with mental illness as victims. They classify children. They classify women, gays and lesbians, people suffering addiction are all classified as victims. That’s the first thing they do.

The second thing they do, which is as insidious, is that they believe that, to victims, everything should be given and nothing demanded. This is terrible for raising kids. It’s also terrible for dealing with people suffering from addiction and mental illness.

The fact of the matter is a fair number of the people on the street have been victimized. It’s true. There’s a higher percentage of people on the street that were abused, foster kids, and were physically or sexually or emotionally abused, and that’s terrible, but that does not merit giving people the cash to use drugs, giving them hotel rooms in which to use drugs, giving people the paraphernalia in which to use drugs.

During the pandemic, the city of San Francisco … the social workers for the city were actually buying people alcohol and delivering alcohol and drugs to people’s hotel rooms. It’s so bonkers that when I describe it, it sounds like I’m describing a fictional dystopian film, but this is actually what’s happening in San Francisco.

The San Fransickness that the title refers to, yes, it’s referring to the folks that are living in squalor on the streets, but it also is referring to a kind of compassion sickness, a compassion unchecked by discipline, by reciprocity, by personal responsibility, by the things that people need in order to improve their lives.

Allen: Yeah. You talked a lot about that kind of victim mentality, victim mindset during your conversation with Joe Rogan, like you mentioned. Excellent conversation. So how does that translate? You referred to it with Joe Rogan as a coddling mindset. How does that translate to policy? What’s the line of thinking that we’re seeing from politicians going from, “OK, these people are victims. We need to care for them,” but how has that translated in policy to, “We do nothing to stop them from openly using drugs as much as they want, living wherever they want, doing whatever they want”?

Shellenberger: Yeah. You just said it. The coddling that has been increasing, really, for 150 years is now extended to people on the street, so we’re coddling the people on the street. We’re coddling addicts, we’re coddling criminals, we’re coddling would-be murderers, rather than providing them with the discipline and the rules that they need in order to live happy and healthy lives.

Look, to some extent, what we call coddling started out as kind of positive. Let’s face it, life on the farm was pretty rough. Kids were beaten with sticks and rods. … We know that coddling was already increasing when you started hearing people say things like, “Spare the rod, spoil the child.”

There’s always been a recognition that as we go from farm to city kids, to some extent, this is a process that’s been really wonderful for children. They can be children. They don’t have to be little workers or little adults, which is how we used to see kids. But obviously, it’s gotten way too far. We see the rise of participation trophies for kids that don’t succeed in sports, basically a shielding of children from adversity. Yet we know that overcoming adversity is what builds strength and resilience.

One of the questions I had is there’s a lot of upper-middle-class parents or middle-class parents that are very progressive and liberal in the Bay Area who, yeah, they coddle their kids to some extent, but they also require their kids to do their homework. They require their kids to do chores. They require their kids to do sports. They require some amount of adversity of their kids. But then when it comes to their politics, they’ll say things like you shouldn’t require abstinence, for example, before giving people housing, because that would be blaming the victim. So there’s a bit of a double standard here.

One of the most interesting things I discovered is that the drug rehab centers in Malibu—which is this very rich coastal community north of Los Angeles, the thing that rock stars and celebrities go to, $50,000 a month—they’re very strict in drug rehab for rich people. They’re very strict. They’re hard on you. That’s what you pay for.

Yet for the poor on Skid Row in Los Angeles, which is just a devastating area, thousands of people addicted to hard drugs dying on the streets … it sounds bizarre to describe it. Literally, when I visited Skid Row last time, there were just people passed out on the sidewalk, on fentanyl, on heroin. That’s it, just in the sunlight, lying on the ground. There was too many people to even check to see if they were alive. So the coddling is now part of our policy response.

As I point out, I had this very revelatory trip to Amsterdam, which in every respect is a very liberal city. You can smoke marijuana in these coffee shops they have. Psychedelics are very in fashion. Sex work is kind of decriminalized, regulated. They’re not a bunch of Puritans in Amsterdam, but there’s nobody on the streets. There’s no so-called homeless people. There’s nobody on the streets using drugs. They make people stay in shelter, and they enforce their laws.

What we have in San Francisco, it’s a more radical … In Boston and New York, we are now starting to see open drug scenes. There’s now a big open drug scene in Boston, but it’s nothing like the West Coast. It’s really the combination of a Wild West libertarianism and libertinism with a progressive victimology that’s been what’s been so toxic and devastating for people suffering from addiction and mental illness.

Allen: Yeah. Now, I know in writing the book, you kind of went on a search to see, OK, who is actually addressing this correctly? Who’s doing this well? Like you said, you went to Amsterdam. You spent time in the Netherlands. You talked to leaders. What did you discover that the Dutch are doing really well, and what are some of the principles that you learned from them that you’re trying to convince individuals in America, “Hey, we could actually do this here”?

Shellenberger: Yeah. What I discovered ought to be great news for both reasonable liberals and reasonable conservatives. The first thing is that in Amsterdam, they have the back-end services, so they have shelter for everybody that needs shelter. They have housing for the people that really do need subsidized housing. They have psychiatric beds and psychiatric care for the people that need that. They have the police working with the social workers. It’s both/and.

… There’s a lot of fake bipartisanship right now. There’s a lot of fake efforts at it, but this is really, truly, a both/and approach. You need police and you need social workers. They’re not the same thing, but they need to work together. So you get these buddy stories of police and social workers that have been working together in Netherlands that are really important. We’re starting to see some of that in the United States, but not nearly enough.

One question is, do you need to have single-payer health care? That’s what the left has long wanted. They want socialized medicine. Amsterdam does not have socialized medicine, but they do have universal coverage. They actually have a private insurance model like we have in the United States, but you make sure that everybody’s covered. That is something that we need to do. That’s something that I think reasonable conservatives and liberals would agree on. To some extent, we have that with Medicaid, but you can’t be in situations where we don’t have insurance to cover people’s psychiatric care.

The other thing is, there’s some amount of discernment. My aunt had schizophrenia. She had a pretty good life for a person with schizophrenia, which is a very serious mental illness. She lived in a group home, as we call it, residential care. She had her own room. She shared a house and a kitchen and a living space with other people. But she didn’t work. She couldn’t work. Some people with schizophrenia can work, but she wasn’t able to. I think most conservatives understand that there’s a certain number of people in our society with mental disabilities like schizophrenia who, if they can work, it’s great for them and it’s great for everybody else, but some of them can’t.

But that’s different from a 25-year-old guy who’s addicted to heroin, who probably just needed an antidepressant and some purpose in life and some Jordan Peterson lectures in order to be on the straight and narrow.

That young man needs to get his life in order, and that means that he needs to be, after he breaks the law—if you’re a street addict, you’re breaking the law every day, usually, including theft to sustain your drug habit. He needs to be offered the choice of, when arrested, offered the choice of jail or drug rehab, and then he needs a personal plan. He needs an assertive case worker. … He needs to know what he’s going to do when he gets out of rehab. He needs to have a job. He needs to have a place he’s going to live, preferably living somewhere far away from open drug scenes.

And the drug scenes need to be shut down. You can’t allow open-air drug dealing in a city. It’s absurd. We have literally two dozen drug dealers selling you any amount of drugs in, not just San Francisco, but other major cities in the United States. We have to shut that down. This is not rocket science. You can’t allow open drug dealing.

Does that mean that you’re going to eliminate drug dealing? No. But I’ll tell you, it’s interesting, if you’re an addict and there’s no open drug dealing, you often have to spend a bunch of your day finding your drugs, buying them, and that means you end up doing less drugs. So it’s not great. I’d love to see fentanyl eliminated and meth, but these are highly-concentrated drugs. We haven’t been able to get rid of them.

I think the idea that we can stop China or Mexico from getting them over the border is a fantasy. You can mail enough fentanyl to somebody through FedEx to supply an entire city. But you can shut down the open drug dealing. That’s easy. Shut it down. The addicts will end up using less. Right now, it’s too easy. The open drug scenes are addicts living in open drug markets, and they’re just ending up using hard drugs every four hours. It’s barbaric, and it makes them sick and they die. You can’t allow that.

… I think the message for conservatives is that, and the liberals too, but I think in the sense that you do need to fix our psychiatric and addiction care system. It’s just not working. And I think that is something that I did find some agreement among conservatives with. …

There’s just not a free market—there’s not a market among schizophrenics to pay for their mental health care. They just don’t have the money and they can’t do it. Even addicts are people that have spent basically all their resources and stolen, usually, from family and friends to sustain their habit. That’s just not something that’s going to be served by free markets.

There’s got to be some amount of government involvement, and it just should be smart and it should be efficient. There should be a hierarchy, and there should be accountability and responsibility. So I do think there’s plenty in the proposal that I’m making for Cal-Psych to centralize addiction and psychiatric care to appeal to both reasonable Republicans and to reasonable Democrats.

Allen: And it goes with the analogy that you have given, I know, in the past of the carrot and the stick, of, OK, we need to make sure that we’re actually motivating individuals who are on drugs to make changes in their life, and then there have to be consequences when proper action isn’t taken.

Shellenberger: It seems so basic, doesn’t it? … When I asked the character in the book—terrific character, his name is Rene. He’s Dutch. He’s actually a nurse who was a former professional soccer player, very charismatic, very blunt. He and his wife, who’s a member of Parliament, they love to travel, so they love San Francisco. I was like, “What is going on in my hometown? What are we doing wrong?” He was like, “Look.” He goes, “Look, dude, you need carrots and sticks. You got to have carrots and sticks.”

You got to have consequences for bad behavior. You got to enforce the law. At the same time, you should reward people. What’s happening, we now know, at the brain chemistry level, although, honestly, addiction science hasn’t progressed that much, but we know that addicts are seeking rewards, so you want to provide some other reward as a dopamine high for addicts when they perform well. So if you pass your drug test, you should get something, a gift card. You should get your own private room. Something should be done as a carrot for you.

It seems so basic. But basically, what we’ve done in progressive cities, out of this softening, this coddling in the culture, is we’ve removed all the sticks. We’ve actually removed the carrots too, because … when you give somebody something that they have not earned, it’s not actually a carrot. It’s an entitlement at that point. So for it to be a true reward, you have to earn it.

That’s why participation trophies are so terrible. Kids know, “Why am I getting a participation trophy? I lost.” It’s supposed to feel bad to lose. You should feel good to play the game. You should just have fun playing the game, but you shouldn’t get a trophy for playing the game. Similarly, you should not give people housing for being a drug addict. If you’re down on your luck and you quit drugs, then maybe you do get some housing or some subsidized housing or some reward, but not for your bad habits.

Allen: Now, I know that you have spoken with leaders in California and other West Coast cities that are experiencing these issues. Do they recognize that there is an issue? And if so, why aren’t they taking steps to actually bring change?

Shellenberger: This is the craziest thing. I found a lot of agreement from both liberals and conservatives for the program that I’m advocating, which is just a modified Dutch model, a modified European model.

I interviewed California Gov. Gavin Newsom’s top adviser on mental health, homelessness, and addiction. His name is Thomas Insel. He worked at the National Institute of Mental Health for 12 years. He was the director of the National Institute of Mental Health. The man and I had a Zoom conversation for over an hour. He’s got his own book coming out. And we were finishing each other’s sentences. We didn’t disagree on anything, literally zero. We had zero disagreements.

And I just asked him, I was like, “Tom, can you go talk to the governor? What’s going on? Why is this not happening?” He just was like, “Well, the people in Sacramento, they say you have to modify the Constitution.” OK, so let’s modify the Constitution. That’s actually not as hard as it may sound. We pass ballot initiatives all the time in California to modify the Constitution. We love to do that in California.

He finally said, and he said it six times in our interview, “It’s a leadership problem. It’s a leadership problem. It’s a leadership problem,” which is as close as he would come to basically saying Gavin Newsom is not the leader that we need, because obviously Tom Insel has to be a political person. He’s a very good person, by the way. It’s not a criticism at all.

We’ve got a problem with our political leadership. Obviously, I think you need new leadership in California. Can someone beat Gavin Newsom next year in the run for governor? Very hard. Gavin Newsom has so much money. So to some extent, what I’m talking about here is the need for significant political change. I think that Democrats certainly need to change, but I think Republicans need to contest Democrats and Democratic rule on these issues.

I’ll tell you something that really I found inspiring, is that the way that in Amsterdam, in the Netherlands, it took political change, it took, really, a political revolution whereby the center-right defeated the left-wing parties on this issue, on this issue of open drug scenes, and that is why … the Dutch government has been a center-right government. If it were translated into American context, it might be more like center-left. I don’t know. But in the Netherlands, it was center-right. They defeated the left on this issue.

So what I would say to my Republican friends, and I’m an independent, is, I would say, start competing with Democrats on this issue. Have a proper agenda. I think that that’s not just what it’s been to date. I think what it’s been to date is, I hear Republicans and conservatives talk a lot about the need for the churches and the charities and private-sector solutions. That’s not good enough. There has to be a governmental response.

For me, if the center-right is going to be the change that we need in the world, then they need to change, I think, the agenda that they’re offering. And we’re starting to see some of that.

I did see Republican candidates in the recall that just failed attempt to offer that. But I think much more should be done both at the state and the federal level by conservatives and Republicans to offer a proper agenda to deal with this problem, because in California it’s the No. 1 issue. It’s not the No. 1 issue nationwide, but it’s the No. 1 issue in California. And it’s also now a big issue in Boston, Philadelphia, Chicago, New York, other big cities where conservatives, Republicans, center-right candidates want to start contesting Democratic rule.

Allen: In the model that you have created, taking pieces from the Netherlands, what they do there, and how to address homelessness, drug addiction, mental health, what is step one? What is the action that progressive cities need to take today to start fixing this problem?

Shellenberger: Yeah, the first thing is, shut down the open-air drug dealing. There’s no need for that. Build emergency shelters. Require people to use them. Do triage. If you want to earn housing, then make progress on your personal plan. I think the issue needs to be handled statewide so that people that are arrested in the open drug scene in San Francisco can get treatment in Fresno, can get treatment a couple hundred miles away, away from where the temptations of drugs are.

I’m completely practical when it comes to dealing with addiction. Some addicts need opioid substitutes. They might need methadone or Suboxone as a substitute. That’s fine. I think that there’s something more heroic about becoming completely sober and abstinent, but I think we’re dealing with a massive drug epidemic and we can’t be perfectionist about this or we can’t make the perfect the enemy of the good.

So shelter first, treatment first, housing earned, make psychiatric and addiction care a statewide function, create Cal-Psych, and then we probably need to—I’m not totally sure. It was funny, because I would get to this place with this book where I go, “Gosh, is the problem the liberal laws, is it the liberal judges, or is it the politicians and the public?” It’s kind of all three.

One question is, how much can be done under existing laws? The short answer is a lot. Do we need to change some of the laws too? Probably, but again, that’s what you have leadership for. …

For example, if we had a truly great governor, the governor would come in and would do as much as you could through executive order. You would then put forward a big legislative package or separate legislative vehicles, it depends, in front of the legislature, and then you would also put a bunch of initiatives on the ballot.

The thing is, the great thing about having an emergency, a true crisis like this one, is that you have the will of the people to want to solve this. The public in California are just—we’re fed up. People are fleeing the state. We’re desperate. Honestly, it’s gotten so bad that the real issue, I think, is just the cynicism, that people believe that nothing can be done, and we ended up losing some of our best and brightest people to New York and Miami and other states.

Allen: Yeah. Well, you’ve been living in this world for so long. Are you able to kind of walk out the other side of all this research optimistic? Do you think that there can actually be real change?

Shellenberger: I do. I find hope in a couple of different areas. First of all, I think that the culture is changing. I think that we are in the midst or we’re at the beginning of a backlash against cancel culture, against woke religion and woke ideology.

It’s interesting, there are even some liberals and leftists that are expressing support for my position on drugs as well as on energy. They’re starting to do so on Twitter. They get shouted down by other progressives, but they’re starting to kind of poke their head up out of the tunnels to say, “Hey, I think Shellenberger is making a good point about this. It’s not moral to have people with schizophrenia on the street.” So that’s starting to happen in the culture.

I love these long-form podcasts because one of the problems that this issue has had is that people go, “Well, it’s really complex,” and that’s been a way to dismiss having the conversation about what to do about it. Long-form podcasts are a way to talk about the complexity in a way that it’s just much harder to do on television and sound bites. So I’m excited about what’s happening in the culture.

Then I just think there is a big opportunity politically for somebody to offer—honestly, I genuinely believe it could come from either the center-right or the center-left. California has an open primary system, so you could have a Democrat run on this agenda against Gavin Newsom next year, you could have a Republican run, or you could have an independent run. It seems to me that there’s a big amount of space for some political entrepreneur who picks up this agenda.

I and my organization have helped to create a new statewide coalition called the California Peace Coalition, because we don’t have peace in the streets, we don’t have peace in people’s minds. And we’ve attracted support from parents of kids killed by fentanyl, parents of kids addicted to fentanyl, recovering addicts, community leaders, and just interested citizens like myself. I do think that it’s created a kind of opportunity for a different approach than the one that’s been pursued either by the left or the right on these questions for the last 30 years.

Allen: The book is “San Fransicko: Why Progressives Ruin Cities.” You can follow Michael on Twitter, @ShellenbergerMD. You can get a copy of the book on Amazon, Barnes & Noble. You can listen to it on Audible.

Michael, we could keep going, but want to let you go. Thank you so much for your time. Really appreciate your insight.

Shellenberger: It was a pleasure speaking with you. Thanks for having me on.

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Congress Shouldn’t Exempt Medicare From Mandatory Budget Cuts

The federal budget’s largest programs, especially Medicare, are growing at unsustainable rates. To ensure fiscal responsibility, Congress needs to control the growth of programs that operate on autopilot, known as mandatory spending.

Although most of the congressional debate related to the Budget Control Act of 2011 over the past decade has been about placing caps on so-called discretionary spending for defense and nondefense programs, the law also has helped reduce some mandatory spending. 

At the beginning of each fiscal year since 2013, a provision of the Budget Control Act known as mandatory sequestration has prevented a few percentage points of spending that otherwise would have gone out the door. Reductions of Medicare’s $926 billion in annual spending would be limited to just 2%.

Although the process of mandatory budget reductions– sequestration–should be improved to cover more programs and much more needs to be done to control spending, making the cuts through the Budget Control Act has proved so popular that Congress has extended it five additional times. 

During the COVID-19 pandemic, however, congressional leaders temporarily exempted Medicare from legally authorized cuts under the process of budget sequestration.

With enactment of the Coronavirus Aid, Relief and Economic Support Act of 2020, lawmakers instead provided for a 20% increase in hospital payments for COVID-19 patients, added beneficiary vaccine coverage with no cost sharing, and “accelerated and advanced” payments to Medicare hospitals.

These special advance payments and the higher COVID-19 reimbursements under the CARES Act were factors as Medicare hospital insurance spending exceeded hospital insurance revenues by a stunning $60.4 billion.

With this package of spending in place, lawmakers exempted Medicare from the 2% budget cuts from May 1 through Dec. 31, 2020.

Subsequent legislation extended this delay in making the cuts through the end of 2021.

But there is no valid reason to delay the Medicare spending cuts through the budget sequestration process. Circumstances have changed since the rapid rise of COVID-19 cases, hospitalizations, and deaths in spring 2020, when Congress provided $150 billion in emergency assistance to hospitals and other medical facilities under the CARES Act.

COVID-19 cases are falling, and so are hospitalizations for the disease caused by the new coronavirus. Based on current data, the Centers for Disease Control and Prevention reports that the decline in related hospitalizations likely will continue.

The Medicare trustees say that COVID-19 itself will not have a long-term impact on the status of the hospital insurance trust fund. In fact, the trustees report that 87% of Medicare beneficiaries will be vaccinated this year, and Medicare hospital providers are on track to repay the “accelerated and advanced” COVID-19 payments. The trustees even project that the Medicare hospital trust fund will enjoy a rare surplus in 2022.

Nonetheless, the Medicare trustees warn that relentless future spending increases in the entitlement program will impose enormous financial burdens on Medicare beneficiaries and taxpayers alike, while contributing to big budget deficits and dangerous debt.

So, given the prospect of a 2% cut in Medicare spending on Jan. 1, 2022, Congress should stand strong in the face of anticipated, intense hospital lobbying and resist any attempt to delay or cancel the sequestration order.

Make no mistake. One-off budget cuts as part of sequestration won’t solve Medicare’s endemic spending problem. Only major reforms would slow Medicare’s spending growth while improving the program for beneficiaries and providers alike.  

The most important of these reforms: the transformation of the entire Medicare program into a defined contribution (“premium support”) system. In his system, traditional Medicare, Medicare Advantage, and other private plans would compete head-to-head on a level playing field and beneficiaries would be empowered to pick and choose plans and providers that best serve their personal wants and medical needs. 

Such an intensely competitive market system not only would control costs but stimulate innovation that would deliver a higher quality of medical care and superior medical outcomes. In short, it would deliver better value for our Medicare dollars.

Meanwhile, Congress must use the budget sequestration laws already on the books, to restrain the explosive spending contributing to those mounting deficits and that dangerous debt. 

Given the pressure on beneficiaries and taxpayers alike, now is not the time to suspend a 2% cut in Medicare spending through sequestration that would at least slow, to some extent, the program’s relentless growth.

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Anarchy Reigns in Portland

Immediately upon taking office, President Joe Biden removed President Donald Trump’s designation of Portland, Oregon, as a jurisdiction in anarchy.

So, how are things going now?

Anarchy reigns in the City of Roses.

Over the weekend, police were called to 19 shootings. One of which is likely to be ruled a double homicide, bringing the total number of murders in Portland this year to 71, surpassing the 1987 record of 70.

Homicides are only part of a larger problem in Portland.

Earlier in October, a mob of around 100 anarchists tore up the downtown part of the city while police looked on.

They went on a rampage, spraying slogans like “kill cops” on the buildings they vandalized, and did at least $500,000 worth of damage, according to Fox Business.

The Portland Police Bureau said that no arrests were made because of the destruction.

But that wasn’t the fault of the police. Instead, the problem is the politicians who govern the state and local officials, who have intentionally tied the hands of law enforcement. They are the reason why it is impossible to stop criminals and mobs from doing what they wish to the city.

Portland Police Lt. Jake Jensen said in an interview with KOIN, a local Portland CBS affiliate, that the reason his department didn’t intervene was “House Bill 2928 and the restrictions placed on us in a crowd control environment.”

The legislation deeply restricts the use of nonlethal crowd control tools, like pepper spray and rubber bullets. Though there are exceptions to this law in the case of serious threats to public safety, like a riot, local authorities are still wary about using these tools.

“The law clearly allows Portland Police to use effective tools necessary to control violent crowds,” House Minority Leader Christine Drazan, a Republican, said in an interview with the Associated Press. “However, activist attorneys are deliberately misinterpreting legislation to prevent police from intervening. They have no business putting law enforcement and community safety at risk.”

Portland Mayor Ted Wheeler, a Democrat, said nothing of the issue.

Wheeler marched with protesters in 2020 following the death of George Floyd at the hands of Minneapolis police. He was all aboard the “defund the police” movement, too.

The Portland mayor is a lot quieter these days.

Despite these attempts to placate the activists, the mob eventually turned on Wheeler and accused him of being a “fascist” for not giving in to their every demand.

It turns out, appeasement doesn’t work when dealing with uncompromising radicals. Joining with them to show solidarity isn’t much help either. Alas, even Robespierre went to the guillotine.

Now, Wheeler is besieged, and so is his city.

While plenty of local and national left-wing media have done their best to make it seem like the disintegration of Portland is overblown, it’s hard to ignore its problems.

Portland has quickly become one of the most violent cities in America.

This follows the trend of last year when Portland saw the largest increase in homicides in the country. Impressively terrible given the nationwide homicide spike.

Maybe if Portland and Oregon’s leaders had backed the blue, the city’s streets wouldn’t be running red.

But now that the city is slowly reversing itself by restoring some police funding, and recreating the violence prevention unit that was abolished in the wake of the George Floyd protests, the bleeding is hard to stop.

Ordered liberty once lost is difficult to restore.

It isn’t just the Portland mayor and Oregon politicians that have made a mess of the situation. Portland’s George Soros-backed district attorney consistently drops charges against protesters and people who interfere with police duties. So even if the police are given the green light to act more aggressively in stopping crime, their efforts will often come to nothing if lawbreakers are immediately released.

No wonder the city was besieged with protests and riots for nearly 200 straight days following the death of George Floyd.

Portland is a microcosm of the blue-city model that’s disintegrating so completely. High crime, lawless activists operating with impunity, rampant homelessness, and a depressed business climate are the telltale signs of its failure.

Portland residents may pride themselves in their commitment to “sustainability,” but these trends are far from sustainable or desirable.

The statues came down first, then everything else.

This is the borne fruit of mob rule.

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Democrats Use Accounting Gimmicks to Conceal Spending in Bloated ‘Build Back Better’ Bill

President Joe Biden is twisting arms to get “agreement” this week on hundreds of tax and spending provisions in his multitrillion-dollar social-welfare bill while key Democrats seem to be settling on a plan to keep the price tag down.

They want to reduce the overall size of the spending bill to “only” $1 trillion to $2 trillion (as though those two numbers were even remotely close), and only fund programs for a short time, assuming that it would be too painful for a future Congress to stop funding them.

There’s simply too much in this massive “Build Back Better” bill to digest—free community college, paid family leave, universal pre-K, bigger child tax credits, climate “incentives,” and, of course, major expansions of government spending on health care, as The Daily Signal has explained in numerous articles.

Sen. Joe Manchin, D-W.Va., says he wants a smaller bill, honest funding for new programs the bill creates, and more time to get it done. 

This is dangerous legislation that would have to be passed by the slimmest of margins in both the House and Senate and signed by a president whose poll numbers are plummeting. But Democrats are nonetheless plowing ahead.

On health care, the supposedly “pared-down bill” would, for example:

  • Expand Obamacare and make generous health insurance subsidies available to the most affluent Americans—but only for four years, rather than the full 10.
  • Expand Medicaid to 2.2 million people in states that have not already expanded it under Obamacare, but only temporarily.
  • Expand Medicare’s benefits to cover hearing, dental, and vision care, but maybe with a voucher.
  • And spend $100 billion or so less than the $400 billion allocated for home health care—and labor union expansion.

“The main economic effect is crowd-out,” Brian Blase explained in Forbes in a paper analyzing Congressional Budget Office spending estimates. 

“Most of this new government spending would replace private spending that otherwise would have occurred to purchase health insurance.”

Doug Badger asks in a Daily Signal article why politicians on “the left, many of whom want government to run our health system, are OK with shoveling hundreds of billions more to private health insurance companies to further boost their profits.”

Badger writes that as much as 17% of the new spending will go to profitable health insurance companies.

For conservatives, corporate profits and executive compensation aren’t troubling in and of themselves. What concerns them is a partnership between big government and big corporations to milk taxpayers and place their interests above those of consumers.

For liberal lawmakers, at least to judge from their rhetoric, voting for more profits for the health insurance industry should be problematic.

Apparently, it isn’t. It turns out that they can support arrangements that enlarge government control, even if that control benefits big corporations and their CEOs.

The 133 House and Senate Democrats who have co-sponsored “Medicare for All,” which would abolish private health insurance companies, seem to be just fine with that, continuing an alliance between liberals and the health insurance industry that has been around since Obamacare’s creation.

Chris Holt of the American Action Forum reports that “as currently drafted, the Build Back Better reconciliation bill would likely spend more than the [Affordable Care Act] to insure between 4 [million] and 7 million previously uninsured people, while causing substantial disruption to insurance coverage for millions of people who are already insured.”

Politico reports that leaders are now stalking the popular Medicare Advantage plans to come up with $100 billion to $150 billion to help fund their social-welfare transformation, with a goal to announce an agreement on the structure of the bill this week.

The more they struggle, the more the American people learn about the details of the bill and the more difficult it will be for Democrats to enact it.

The Daily Signal publishes a variety of perspectives. Nothing written here is to be construed as representing the views of The Heritage Foundation.

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