Since the mid-1970s, the mental health treatment system in the U.S. has faced budgetary famine. This is in stark contrast to the growing cornucopia of fiscal resources enjoyed by the overall health care system. This paper explores the complex reasons for this disproportionate allocation in health spending. On the one hand, mental health may suffer from the perception that its diagnoses are largely “subjective” and its treatments do not fit the traditional “medical model” that can be defined precisely and paid for by third-party insurers. But more importantly, the dearth of mental health resources can be attributed to the peculiar nature and characteristics inherent in American politics. This paper describes the American political environment, from both a historical and a contemporary perspective, to give some insight into the development of policies affecting the mental health system in the U.S. Given the current climate of fiscal conservatism in this country toward any increases in social spending, it is likely that the profound mismatch in need and spending for mental health programs will continue indefinitely.

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