This is an interesting look at a deep seated problem. I think you are right that we need to concentrate resources where they do the most good but that isn't always easy to decide. I think the biggest danger with categorizing is those categories can be fluid and overlap. For example, the Winns qualified for public housing but choose instead to hike the SW path. Along the way they camp illegallly and occassionally steal. Does that move them from category one to category four like the Rainbow family?

I love your break down though. We all need to think about this more and be willing to spend more wisely as taxpayers to help.