Orange County’s Homeless Population Grows by 28% Despite Billions Spent by State

“So you mean to tell me that we've spent billions of taxpayer dollars to... increase homelessness?” asks State Senator Janet Nguyen in frustration.

Homelessness is on the rise in Orange County. Recently, a survey required by the federal Department of Housing and Urban Development revealed that the homeless population grew from 5,718 individuals in 2022 to 7,322 in 2024—a stark increase of 28%. 

“At the end of the day, we’re doing so much and we still can’t solve the problem,” Orange County Supervisor Katrina Foley acknowledged. She went on to suggest that solutions may lie in increasing the housing supply and expanding “access to affordable rent,” which seems to be an allusion to rent control.

The only problem with Foley’s suggestions is that neither policy has succeeded in resolving homelessness. In fact, they often only exacerbate the problem.

Over the past half decade, California has spent approximately $24 billion attempting to tackle homelessness through housing programs. The state also pushed local municipalities, often against their will, to allocate space for high-density, low-income housing—an effort which is expected to ramp up due to new legislation sponsored by Governor Gavin Newsom. And in that time, across all efforts, the state’s homelessness population has only risen. 

One would think that for every one bed provided by permanent supportive housing (PHS), it would reduce the homeless population by one. Instead, the number by which one PHS reduces the number of homeless individuals by a meager 0.04, according to a comprehensive Journal of Housing Economics study. In California specifically, that number may even be lower.

California State Senator Janet Nguyen, who is also a candidate for the Board of Supervisors, expressed her frustration on social media. Her tweet, “So you mean to tell me that we've spent billions of taxpayer dollars to... increase homelessness?” encapsulates the way that many Orange County residents feel every time the government suggests another expensive, ineffective program. 

Because Republicans like Nguyen are in the superminority in both the California State Senate and State Assembly, Democrats have had free rein to implement the policies they think will best address the problem without any recourse or substantial challenge. Perhaps that explains why there hasn’t been any meaningful compromise, and why failed policies like rent control still exist despite only reducing the quantity and quality of available housing.

Because rent control is a de facto price ceiling, it is not dissimilar from the minimum wage—a price floor. They both exist, in theory, to help economically disadvantaged workers but, in practice, they put undue financial strain on employers and renters, who are forced to supply less housing units and less jobs, respectively. A recent Wall Street Journal piece asserts that “if there's any consensus in economics, it's that rent control achieves the opposite of its intended goal,” and that “even progressive economists mostly think the policy is stupid.” 

Why, then, do progressives like Katrina Foley not understand this?

It’s because they seem like obvious solutions. If there are people who can’t access housing, why not use taxpayer funds to create more housing at a lower cost? This is reductive and overly-simplistic reasoning. It fails to address the real causes of homelessness; that inflation increases the cost of living which requires the Federal Reserve to raise interest rates in a bid to discourage loans and control the money supply; that a poor economy leads to a difficult job market which itself prolongs unemployment for unskilled workers; that substance abuse and mental illness cannot be treated by building units or checking into temporary housing.

In short, the government’s solution to seemingly any multifaceted problem is to throw taxpayer money at it, posture about how compassionate the effort is, and then raise taxes on residents when the initiative does not yield the expected result. Its track record in this regard is awful.

If Orange County hopes to address its growing homeless problem, Sacramento is the last place it should look for advice.