Are Americans insane when it comes to mental illness?

It's a bit off topic but I still think the questions raised by Rich Lowry editor of National Review, in his recent essay should be asked about a lot of uncomfortable subjects. Here's a preview of what he says:

In early 21st-century America, what do you do when you encounter a severely mentally ill person?

Anyone who lives in the city knows the answer to that question — you step around him on the sidewalk, you hope he doesn’t hassle you, and maybe you give him some money if he’s panhandling.

The authorities at Virginia Tech did their own version of this urban shuffle in their handling of Cho Seung-Hui. It’s obviously much easier to realize that someone is dangerously deranged after he has killed 32 people than when dealing with uncertain knowledge in an environment where any wrong (or even correct) move means a lawsuit. But Virginia Tech often tiptoed around Cho’s mental disturbance.

He argues that "one intellectual current behind the trend [to leave the mentally ill to their own devices] was a moral disempowerment of sanity." As Lowry writes:

One of the most influential academics of the late 20th century, Michel Foucault, argued that attempts to label and treat madness were inherently arbitrary and repressive. Academia has been celebrating “transgression” ever since.

After a couple of decades of having institutionalized the "de-institutional" approach to the mentally ill, how has it panned out? Again, Lowry reports:

According to an extensive survey in the New York Times a few years ago, about half of rampage killings are committed by mentally ill people, a much higher percentage than the roughly five percent that commit all murders. Dr. E. Fuller Torrey, president of the Virginia-based Treatment Advocacy Center, believes there has been a rise in such killings in the past 20 years, which coincides with the period when we have dumped many severely mental ill people out into society without treatingthem.

Perhaps, as Lowry suggests, there may be "a balance to be struck between civil liberties and treating the mentally ill." But beware, he says:

T]hat balance is now badly off-kilter. Cho Seung-Hui was basically abandoned to his private mental hell at Virginia Tech. While he hatched his lunatic and hateful plot, everyone tried to ignore the scary guy in class behind the sunglasses.

Well, now we all know where that approach led.