Yeah... something about the anecdotes told about Diogenes sounds off to me - you don't see homeless people today live the charmed life they say Diogenes got to live.
It's not implausible. Being a famous wit and wacky character can get someone a lot of latitude. I'm reminded of the Emporer of the United States, a locally famous weirdo who lived in San Francisco way back. Among his other notable hijinks, he was unemployed, yet never went hungry because he printed his own alternate currency (which he insisted was the only valid currency). Many of the local shops and restaurants just accepted it like official money even though it was worthless to anyone else, because everyone enjoyed his antics so much.
There are characters like this in New Orleans. They just get by and get high with the community. Homeless people really help each other out down there too