Greg,
You'd think there would be a straightforward answer to your straightforward question, but alas, like many issues in our field, things get complicated pretty easily.

As Gail Wasserman has said before, the growing prevalence of SA/MH problems as youth penetrate further and further into the jj system is not evidence of some sort of iatrogenic effect. Arresting, charging, and adjudicating youth doesn't "cause" SA/MH problems, but those processes end up sorting youth, and the youth with SA/MH issues have a higher probability of moving on to the next stage, for various reasons, some good and some bad.

It would also be wrong, however, to conclude that since SA/MH problems are more common in the deep end, that must mean that SA/MH problems are what "causes" youth to offend. In some cases this is probably true, but it would be wrong to see SA/MH treatment as a panacea for crime reduction. Most youth come into the jj system "with" SA/MH issues, not "because" of SA/MH issues.

As I said in my recent post, we know that youth coming into the jj system are more likely to have SA/MH issues, but we have not yet teased out the contribution that socioeconomic and environmental factors play in the difference. It is quite possible that poor youth, school-challenged youth, and youth from chaotic families are more likely to be diagnosed with SA/MH issues, AND more likely to be caught up in the juvenile justice system. But, what we're seeing might be correlation, not causation.

I'm not suggesting that treating SA/MH is unimportant for crime prevention and reducing individual recidivism. It is very important. But, it is just one part of effective intervention.

So, it's important that we look for SA/MH issues at the front door of the system and react effectively, because youth with SA/MH problems are less likely to be diverted. They SHOULD be diverted, of course, if their delinquency charges do not merit more intrusive interventions, but this doesn't mean that we should ignore their SA/MH issues. It means that we need to be more creative in addressing them without dragging the youth deeper into the justice system than is warranted based upon public safety concerns. So, we should divert, but we should also refer and follow-up. Diversion shouldn't be a way to ignore young people.

And, yes, it's important to recognize that once youth end up in the deep end, a lot of them will have SA/MH issues, so good treatment has to be a part of what happens in the deep end.

I know it's annoying when someone asks a question with the form: A or B? ... and the answer given, is both A or B. But, it's the only answer I can offer.