The number of people institutionalized decreased constantly after the Second World War, partly due to the work of patient advocates and partly because government cheapskates saw it as a way to save money. Reagan was one of the latter, but it is simplistic to think that he was a jerk who hated crazy people. This issue has been discussed in the legal system at great length, and at this point it is extremely difficult to put someone in an institution without their permission.

In L.C. v. Olmstead, 527 U.S. 581 (1999), the United States Supreme Court ruled that placing in institutional facilities individuals with disabilities who are capable of living in community settings constitutes a form of discrimination under the Americans with Disabilities Act (ADA). 42 U.S.C. § 12132. In so ruling, the Court gave great power to the "integration mandate" found in Title II of the ADA that applies to state entities. It requires that public entities administer programs, "in the most integrated setting appropriate to the needs of qualified individuals with disabilities." 28 CFR § 35.130. The Court also recognized Congress's intent to set forth a "comprehensive view of the concept of discrimination" in the ADA that does not require a demonstration that people with disabilities were treated differently than a comparison class of individuals with no disabilities. Olmstead, 527 U.S. 581, 598. In this case, segregation of persons with disabilities in institutions (and the consequences of that segregation) was viewed as inherently discriminatory.

However, the people pushing this idea were not in power as far as being able to implement their ideas to replace it.  The left acknowledged all along that mainstreaming would have been more expensive.  The notion was siezed on by the right and used as an excuse to CUT funding and close mental health facilities.  This was in no way, shape, or form the goal of the left.

And I saw the right do this, led by one Governor Ronald Reagan, all over California before he took his shit national and the rest of the country started following suit.  Not only do I blame Reagan for this, I blame him even more for selling it.  

He's directly responsible for spreading this bullshit lie and making sure it seeped into the national dialogue:  If someone wants to sleep in the park and drink his social security money, who is to say that this is wrong?

Congrats.  You couldn't have said it better if Peggy Noonan had written it for you.  It's nothing but convenient way to let the stupid and unthinking sleep at night without spending too much time wondering why they're stepping over families on their way to work.

Maybe we can eventually make language a complete impediment to understanding. -Hobbes