Earlier quoted context omitted.
Meanwhile, we have a crisis in the U.S. of people sleeping and dying in the streets because we shut down all the mental hospitals and involuntary commitment. Every system will have some percentage of adverse outcomes. Approaching the issue emotionally instead of dispassionately and with a view towards typical outcomes is an anti-social and dangerous approach.
... I mean, on what are you basing this assumption? Mass psychiatric institutionalisation has been phased out pretty much everywhere at this point; if your thesis is correct, how do you explain differing rates of homelessness (and in particular unsheltered homelessness, where the US more or less leads the developed world) between the US and other developed countries? Like, it seems more likely to be some other factor…
While most countries have deinstitutionalized, they still make it much easier to force treatment on an out-patient basis. (This is true of drugs as well, which is part of the reason "harm reduction" often works better in Europe--a credible threat of involuntary hospitalization.) This was the original plan in the 1970s in the US, to transition to out-patient care, but it didn't pan out. The mental hospitals were closed, but rather than shift the funding to out-patient clinics and treatment, the funding was simply pulled altogether. And because of the civil rights law overcorrection, addressing this is more than simply re-establishing the funding. California, for example, restored hundreds of millions of funding in the past decade, but for various legal and inertial reasons, cities and counties simply won't force treatment plans on even the most desperately ill patients, even when they're harming themselves or others. Sadly, we're slipping back into using the penal system to house the mentally ill; there's much less political and institutional pushback than increasing the use of conservatorship and civil commitment.
The problem has been well understood for more than 40 years. Here's a 1984 piece from the NY Times that could be written the same today: Richard D. Lyons, "How Release of Mental Patients Began", https://www.nytimes.com/1984/10/30/science/how-release-of-me...
See also, Natasha Tracy, "In Defense of Mental Illness Conservatorship—Despite the Britney Spears Case", https://natashatracy.com/mental-illness-issues/mental-illnes...