Walk through the downtown in any major city, and you’ll come across untreated, lice-infected, seriously mentally ill people camped out on the sidewalk screaming at voices only they can hear. These are not individuals experiencing low-grade anxiety or suboptimal "wellness" — these are people with acute conditions that can lead to dangerous behavior. The mental health industry tells us that the only solution is more money. But the federal government already spends $150 billion on the mentally ill, with states kicking in billions more.

The problem is not how much we spend, it’s that we spend it in all the wrong places. Mental health spending moved from psychiatric hospitals, which by definition served the most seriously mentally ill, to community-based programs that largely shun those who are so seriously ill they would otherwise need hospitalization. Instead, they focus on improving "mental wellness" in all others.

Mission-creep runs rampant. Instead of funding medications, doctors, case management, and housing for the seriously mentally ill who can become psychotic without treatment, incremental mental health funds are now spent on pursuing vague social goals that have been arbitrarily wrapped into the mental health narrative: improving grades, ending poverty, cutting divorce rates, helping individuals gain comfort with their gender identity, decreasing rates of bullying, and increasing employment. Other mental health funds now get distributed based on identity politics rather than need. Vast pools of funds are targeted to helping African Americans, Latinos, Asian Americans, LGBT, the poor, veterans, homeless, children, and the elderly.

But the funds are not being used to help the most seriously mentally ill within those subpopulations. Instead, they are given to community centers.

Meanwhile, the seriously mentally ill are allowed to decompensate on the streets until they are ready for jail. Ten times as many mentally ill people are now incarcerated as hospitalized.

Nowhere is this trend more pronounced than in New York City and California. They both increased mental health spending but refuse to allocate the incremental funds to the seriously ill. The results have been dismal for taxpayers and deadly for the seriously mentally ill.

In New York, Mayor Bill de Blasio’s wife Chirlane McCray has been taking well-deserved heat from the media and the city council for her ThriveNYC mental health initiative. The program spends $250 million per year — but on goals like "changing culture" and improving "mental wellness" and "emotional resiliency" rather than delivering treatments that can support the most seriously mentally ill.

Since her eye-off-the-prize spending plan was introduced in 2015, the number of homeless who are seriously mentally ill, the number of police calls about emotionally disturbed persons, and the number of seriously mentally ill people behind bars in New York City are all up.

It’s a similar situation in California, where in 2004 voters passed a 1 percent tax on millionaires that generates $2 billion a year in incremental funds that are supposed to assist people with “serious” mental illness. But because the funds are distributed by mental health industry insiders who sit on oversight boards and mental health directors trying to curry favor with mental health programs, funds have been diverted to Zumba classes, drum circles, gardens for people of Hmong ancestry, mindfulness, meditation, and anything new-age.

Meanwhile, California’s homeless camps for people with schizophrenia who desperately need treatment continue to grow. The Los Angeles County jail has one of the nation’s largest concentrations of seriously mentally ill people.

Throwing more money at people who are not seriously mentally ill will not help those who are. Before spending more, we should allocate what we’re already spending to the seriously ill. The Center for Mental Health Services director should require states to use their federal mental health block grants on programs that help the seriously mentally ill. Congress should end the Medicaid policy that prevents states from using Medicaid for the sickest mentally ill adults who need long-term hospital care. The Trump administration should stop its Department of Justice and Protection and Advocacy program from pressuring states to empty psychiatric hospitals, nursing homes, and group homes of the seriously mentally ill. And states should amend their civil commitment laws so the psychotic and delusional can be treated before they become dangers to self or others.

Those are some of the policies that will restore sanity to mental health spending.

DJ Jaffe (@MentalIllPolicy) is executive director of Mental Illness Policy Org., author of Insane Consequences: How the Mental Health Industry Fails the Mentally Ill, and an adjunct fellow at Manhattan Institute.