Elon Musk has called the word “homeless” propaganda and argued that the United States should bring back institutional treatment for people with severe mental illness or drug addiction who pose a danger to themselves or others.
Writing on X, Musk also questioned the financial incentives surrounding organisations working in homelessness, claiming that funding structures could reward organisations for managing larger homeless populations rather than reducing them.
“The NGOs end up increasing the number of homeless people they manage, because that’s the only way to increase their revenue,” Musk wrote. “Incentives drive outcomes.”
He went on to describe “homeless” as “a propaganda word”, arguing that it can suggest someone who has suffered a temporary financial setback and could quickly recover with employment.
“The honest reality is that we need to bring back asylums for extreme mental illness or drug addiction for those who are a serious danger to themselves or others,” he wrote.
Musk was responding to a post by X user Arthur MacWaters, who argued that funding arrangements for homelessness services can create poor incentives and pointed to San Francisco’s spending on homelessness.
“SF spends more than $1b/yr (up 5x) and the homeless population has only grown,” MacWaters wrote.
At the time Musk’s response was captured, it had attracted more than 9,700 likes, 1,900 reposts, 900 comments and 558 saves.
San Francisco does spend significant amounts on homelessness and related services. A city policy document published in 2026 put annual spending on homelessness resources at about US$1 billion, while the Department of Homelessness and Supportive Housing had a proposed budget of US$742.7 million for the 2025-26 financial year.
The city has also increased oversight of nonprofit organisations receiving public funding. San Francisco contracted with more than 700 nonprofits across its services during the 2023-24 financial year, spending more than US$1.5 billion.
Concerns over financial management have arisen in individual cases. An audit of homeless housing provider HomeRise identified expenditure including US$200,000 in staff bonuses and US$12,500 on a social event. HomeRise disputed a number of the audit findings, while the city controller recommended stronger oversight.
San Francisco counted 8,323 people experiencing homelessness in January 2024, an increase of 7.3 per cent from 2022. Of those, 4,354 were unsheltered and 3,969 were staying in shelters or other temporary accommodation.
The city’s homelessness survey also provides insight into the circumstances people reported before losing housing.
Asked to nominate the primary cause of their homelessness, 22 per cent cited losing a job, 19 per cent alcohol or drug use, 14 per cent eviction and 11 per cent conflict with family or friends. Seven per cent identified mental health problems as the primary cause.
Those figures refer to the factor respondents identified as the primary cause of becoming homeless and do not measure the overall prevalence of mental illness or substance use among people experiencing homelessness.
Separate research from the University of California, San Francisco’s Benioff Homelessness and Housing Initiative has found high levels of behavioural-health needs among homeless Californians.
Researchers reported that 48 per cent had what they classified as complex behavioural-health needs, which could include regular drug use, heavy drinking, hallucinations or recent psychiatric hospitalisation. Thirty-five per cent reported regular drug use.
The research also found that 42 per cent of those who regularly used drugs began doing so after becoming homeless.
Economic factors were also identified in the research. A major California study found that participants had a median household income of US$960 a month before becoming homeless, while many reported that rental assistance or one-off financial support could have helped them remain housed.
Among participants who had previously been tenants, 58 per cent reported at least one economic factor contributing to the loss of their housing.
Musk’s call for institutional treatment comes as the role of involuntary treatment and civil commitment is being reconsidered in parts of the United States.
In July 2025, US President Donald Trump signed an executive order directing federal agencies to encourage greater use of civil commitment and institutional treatment for some people with serious mental illness who were considered a danger to others or unable to care for themselves while living on the streets.
The order also sought changes to federal homelessness policy, including a greater emphasis on treatment, recovery and public safety requirements.
Large psychiatric institutions were progressively closed across the United States during the second half of the 20th century as treatment shifted towards community-based care.
The changes were influenced by developments in psychiatric medication, concerns about conditions inside some institutions and legal reforms restricting involuntary confinement.
The National Institute of Mental Health has previously noted that reductions in hospital-based care were not always accompanied by sufficient investment in community services.
Current approaches to involuntary or court-directed treatment vary considerably from the institutional system that existed during much of the 20th century.
California, for example, operates CARE Court, a civil process designed to connect eligible people with schizophrenia and related disorders to treatment, medication, housing and other services.
Musk has previously raised similar questions about homelessness, addiction, mental illness and the language used to describe people living on the streets.
His latest comments place those issues together in a broader argument about how homelessness is defined, how services are funded and when compulsory treatment should form part of the response.
The debate encompasses several overlapping issues, including housing affordability, poverty, drug dependence, mental illness, public safety, treatment capacity and the effectiveness and oversight of homelessness services.
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