Well.... only 20% of children in care are in residential homes- the majority are in foster care, and a significant proportion actually still live with their own parents, on care orders.
I believe the care system is extremely damaging- young people who have been in the care system have the worst outcomes of any disadvantaged societal group in terms of educational achievement, chances of being a teenaged parent, experience of mental ill health, involvement in the criminal justice system, and life chances.
The question is would those individuals have such poor outcomes if they remained outside the care system? Possibly- children placed in care are already traumatised and damaged in the main, and this trauma is in all likelihood what leads to reduced life chances, however the nature of the care system inflicts further irreparable damage.
That said, I think that a system set-up and run the right way, manned by well-trained, knowledgable people could be extremely healing, but it is entirely utopian.
I have to ask- do you think care would have saved/helped you?
Personally I think that while it would have removed me from the situation I was in, it would have brought a whole new raft of problems with it.