EASTSIDER-If you’re like most Angelenos, you’re worried about the upcoming DWP rate increases -- fearing that you are going to get fleeced, and frustrated that you can’t understand how it works. So here’s a very short primer that I hope is understandable, along with some suggestions as to what you can do. 

The basics: Over the next five years, DWP is looking for about 5% per year in water rate increases, and about 4% per year in power rate increases. That translates into roughly $1.2 to 1.4 billion in increases over the five years, depending on how you count a couple of variables. 

The really interesting part is that the DWP doesn’t particularly care how much any individual ratepayer pays in their bill. It’s basically an engineering company at heart, so what they really care about is the total number of dollars they will need over the five-year time period to do their job. Period. 

Who pays what and how that money is divided up into the rate structure for water and for power is of secondary interest to the people who have to do the actual work. 

What’s not needed: The hundreds of millions of dollars that the City grabs as a ‘transfer fee’ each year and the millions of dollars in “feel good pet projects” Council members shift over to the DWP – projects that you and I have to pay for in our DWP bill. We need to stop this ripoff! 

Guess who makes the decisions as to how much you and I will pay individually? The politicians, of course.  After looking at how other utility companies do their billing, hiring a bunch of consultants, and getting input from the Ratepayers Advocate, the DWP Board then votes to send recommendations to the LA City Council. Abut for practical purposes, it’s really the Mayor and the City Council that decide.  Remember, the Mayor appoints every single DWP Board member, and if they fail to do his bidding, they get zapped.  

You have probably heard me say that these new funds are mostly needed to fix the crumbling infrastructure (largely thanks to past manipulation by City Council,) and to pay for legislation requiring a high percentage of renewable energy over this same time period. Every time the Mayor, the City Council, or the State Legislature gets that old ‘feel good green hot flash’ impulse, they impose yet another set of unfunded mandates that the DWP has to implement. And of course, you and I are the funding for these unfunded mandates. 

I can make probably make enough changes in my own water/power needs to offset some of these increases, and can then marginally afford them. But if you talk to my 90 year old mother-in-law who gets about $1000 a month in Social Security, she’s not so thrilled -- nor can she absorb these increases.  All she gets from the politicians is a bunch of hot air and no help. For her and many other Angelenos, the bottom line is the cost, and she’s hurting. 

So let me give you the political math about DWP rate setting, along with some suggestions as to what we can do about it. All my politically savvy friends say that in the era of 10% voter turnouts for LA City elections, homeowners, representing about 40% of the overall population, are far and away the largest percentage (60%) of people who actually bother to vote in municipal elections. 

Why is this important? Because something like 90% of renters do not pay a water bill directly. Big apartment buildings have ‘master meters’ where there is no individual breakdown of use by unit.   Couple that with the Apartment Owners Association findings that about 78% of LA City apartments are subject to rent control, and you discover that there is unfortunately no reason that renters should pay attention to how much water they use -- and according to the LA Times, they don’t. 

Now if you are a homeowner in the Valley, where temperature swings are higher and lot sizes are much larger, you may take a double hit. The proposed new 4-tier system hits people with larger lots in higher temperature zones more than other ratepayers. 

So now you know that homeowners, particularly those in the Valley, have some proof that they are getting the fuzzy end of the lollipop. But are we doomed? And who can fix this? 

Remember, the DWP as an entity has no stake in the answer to these questions – all they want is their $1.2 to 1.4 billion over the five year period. It’s a political exercise. So forget the DWP Board of Directors, unless you like spinning your wheels and getting blown off. Don’t forget: the Mayor owns them. 

Of course, you could try to influence the Mayor himself, that is, if you could actually find him in between his jet setting travel schedule and photo ops. Good luck with that. 

Or, and here’s my proposal:  take a look at the LA City Council’s Energy and Environment Committee. That is where the proposed DWP Rate Increase goes after the DWP Board votes on them in December or January. That is where the proposals are subjected to the political process before the full Council votes on the final rates. And that is one of the few places where politics can still count in modifying ratepayer increases. 

And guess what? All five members of this committee are up for re-election in 2017. The Chair is Felipe Fuentes (CD7), and the other members are Gil Cedillo (CD1), Bob Blumenfield (CD3), Paul Koretz (CD5), and Mitch O”Farrell (CD13). These five are the most vulnerable of the pack, because the voters can actually hold them accountable for their actions. And face it, until a councilmember or two pays the price for ignoring us (as in, losing their sinecure), it will be business as usual for our “go along to get along” elected officials.  

Forget the details about the proposed DWP rate increases. Let’s talk about the “transfer fee” and the pet projects and why everybody doesn’t get treated the same way in their bills. 

Consider talking to all of the homeowners you know and the people and community groups they know. Start focusing on these five elected officials. Demand equal treatment in deciding who pays what for water and power rates. Tiers are not legally mandatory. Get rid of them. Make a stink. Demand answers about these issues from the members of the E&E Committee. You may discover that councilmembers don’t know as much as you think they should. Get excited and start talking about Valley Succession again. Whatever works! 

This fight may be uphill, but it is not a children’s campaign. If you do the political math of who owns homes and who votes, we are one whale of a special interest group. We know we are being used and we know we can do something about it at the polls. Heck, we might even get a fair rate structure. 

For more information about the DWP, its budget, and rate structure go to this link.  

(Tony Butka is an Eastside community activist, who has served on a neighborhood council, has a background in government and is a contributor to CityWatch.) Edited for CityWatch by Linda Abrams.




Vol 13 Issue 100

Pub: Dec 11, 2015

ACTION ALERT-The future of land use and development in our city gets down to a choice: do we want a horizontal city, mimicking what we know -- the low slung buildings and sometimes NIMBY attitude toward development. Or do we want a vertical landscape, where towers triumph? Strong cases can be made for both, each with its pros and cons.  

There’s no end to the number of people who want to live in LA and enjoy our perfect climate and laid back lifestyle. Against that demand is a significant housing shortage -- a finite and dwindling supply of affordable housing. It seems that every time a rent-stabilized pre-1978 building is torn down, often unscrupulously by invoking the Ellis Act, it’s replaced with a bigger building with smaller units and higher rents, forcing the relocation of previous tenants who cannot afford to stay. 

Neighborhood groups are flexing some muscle by joining the conversation. Developers and politicos are becoming accustomed to strident pushback, as evidenced by the recent epidemic of litigation against development. Much of that is centered in Hollywood -- ground zero for development and densification. Rules once created by legislation are being replaced by rules based on litigation. 

Imaginative messaging has become one successful weapon in the arsenals of both developers and communities. Developers are using Hollywood storytelling skillsto gain acceptance for their projects. More and more, communities are successfully mobilizing at the grassroots level. 

Redevelopment of a block at Sunset and Crescent Heights provoked a neighborhood crisis when it was announced. However, this has become a textbook example of how to win hearts and minds. The project’s original, controversial design was changed once Frank Gehry was brought in. The message to the community was that what Gehry was planning would be different -- as evidenced by the installation of two models of the 8150 Sunset project in his massive survey show on view now at LACMA. (Model photo above.) 

The models show a group of three buildings isolated on a plinth. Nearby, a second, more dramatic and storytelling display incorporates the model within the context of the whole hillside, so that perspective can be presented. Lots of visitors are spending time studying these displays at this very popular exhibition. 

This is a smooth presentation, located in a subtle, hushed museum gallery context. It comes across as interesting and effective “advocacy” instead of a hardcore sales job. As a bonus, it didn’t hurt that this pitch to skeptical hillside neighbors who objected to the architect’s first version, were reminded that they would now have a Frank Gehry work of art to look at. Most works of art are memorialized in a museum setting after they have been created and gained an audience. This flips the sequence: the project’s three buildings are displayed as a significant work of art even before being built. 

What other living architect has taken over most of a massive exhibition pavilion at one of the country’s most visible museums? Talk about reinforcement and Hollywood image-making! 

Contemporary artist Takashi Murakami sold his “Multicolore Monogram for Louis Vuitton” handbags during his MOCA exhibition. So it’s no wonder LACMA is now allowing Gehry’s exhibition floor to be an exchange of sorts. For the developers, it’s much more imaginative than fighting with neighbors who are protesting or even litigating against them. This is an example that other developers may want to think about: how to be a storyteller – presenting their projects in a venue where they can tell their story -- a location that goes beyond the traditional community meeting. Hollywood, as one of the image-making capitals of the world, presents lots of opportunity for development conversations to come. 

But then how do you fight against development when you don't have the powers of persuasion on a grand scale such as this? Answer: you have to be a guerrilla and use grassroots techniques that require hustle, imagination and drive. Until last week, when the LA City Council approved Historic Cultural Monument status for 118-124 N. Flores St. in Beverly Grove, (popularly known as theMendel Meyer house,) it was uncertain that a grassroots campaign to achieve that goal would succeed. 

During the summer, tenants at the Los Flores property were evicted by the landlord who used, (and many say unfairly,) the Ellis Act to evict them. The goal was to tear down this building that would eventually be ruled a historic-cultural structure; the landlord wanted to build a bigger building with increased rental potential. All but two tenants, a couple, took the money and moved. Steve Luftman, however, got to work, waging guerrilla warfare (almost like Abbie Hoffman,) against the development establishment. 

What Luftman did should inspire anyone facing eviction under suspicious circumstances: say no and fight back using every means possible that substitutes for money. Namely, engage the neighbors and the community, make a case at the land use committee of the neighborhood council and solicit the support of your councilmember. Use the media by repeatedly sending out stories and updates to the press; open an email address and use other digital resources like social media. 

In addition, you can hold a demonstration at the subject building, file for historic cultural monument status, go to every hearing that has anything to do with your project and make public comment, and most of all, don’t give up! 

Steve Luftman didn’t give up and now the Mendel Meyer house has been granted historic cultural landmark status. The building will not be demolished. 

The Edinburgh Bungalow Court, (photo) not far from Luftman’s building, now awaits a hearing by PLUM (LA City Council’s Planning and Land Use Management committee,) and a vote for preservation by the full City Council. “This has been an incredible fight, and it’s not over yet,” says tenant Heather Fox, co-organizer with Brian Harris of the efforts to protect Edinburgh Bungalow Court. A developer wants to replace it with a small lot sub-division. 

The Cultural Heritage Commission voted unanimously in support of Edinburgh Bungalow Court’s Historic Cultural Monument status on November 19, with lots of community backing and strong supportive remarks to the committee by Councilmember Paul Koretz. 

Fox and Harris also enlisted the support of the LA Conservancy, once it was clear that Survey LA http://preservation.lacity.org/survey had flagged Edinburgh Bungalow Court as an excellent example of a Hollywood bungalow court. 

In the last two months, other guerrilla techniques used to gather community support for Edinburgh Bungalows included a demonstration outside the Bungalows, a canvassing of the neighborhood, handing out flyers, knocking on doors, and stopping to chat with people in the community at every chance. Advocates even set up a lemonade stand on the corner outside the Bungalows; they made yard signs and started a Facebook page. 

Their neighborhood council, Mid City West, supported the preservation with a board motion. By the November 19 Historic Cultural status hearing date, they had 200 petition signatures and 91 letters from people who live and work in the community. Over 30 people showed up at the hearing to speak, including the councilmember, LA Conservancy, Hollywood Heritage, and the West Hollywood Preservation Alliance. 

“We have met so many wonderful people who really care what happens to their neighborhood, and are so grateful for the enthusiasm of the community and especially for the concern and active part of our city councilman Paul Koretz,” says Fox, describing the grassroots, community-led fight for preservation of this structure from demolition. 

Moving to a grander scale is the proposal by The Coalition to Preserve LA to launch a Neighborhood Integrity Initiative ballot measure in an attempt to better manage the spread of new developments in Los Angeles. 

Key elements of their plan include a proposal for a construction moratorium for 24 months for city-approved projects that aim to increase some types of density. During this period, review and updates of community plans would be conducted. 

City employees, rather than developers’ staff, would be in charge of preparing an environmental review of major development projects. 

The city’s community plans would be reviewed and become consistent with the city’s General Plan. 

The General Plan will not be allowed to be amended by what is popularly known as “spot zoning” --where developers are able to get separate variances for a single project. 

The Coalition is ironing out the final language. Then the matter will either be considered by the full City Council – or sent to the voters as ballot measure. Which alternative will be used is yet to be determined. 

Leaders of the Coalition to Preserve LA include Michael Weinstein, Ballot Measure Proponent and President of AHF(Aids Healthcare Foundation); Jacqui Shabel, Hollywood Neighborhood Alliance; Jack Humphreville, the Greater Wilshire Neighborhood Council and UN4LA (United Neighborhoods 4 L.A.); Helen Berman, UN4LA (United Neighborhoods 4 L.A.); John Campbell, Save Residential Hollywood; and Miki Jackson, Ballot Measure Proponent. 

No matter which side of the “horizontal versus vertical” development debate you are on, you can expect lots more noise from each side. This kind of public dialogue is both healthy and an affordable, so add your voice!


(Tim Deegan is a long-time resident and community leader in the Miracle Mile, who has served as board chair at the Mid City West Community Council and on the board of the Miracle Mile Civic Coalition. Tim can be reached at [email protected].) Video courtesy of Miracle Mile Residential Association.  Edited for City Watch by Linda Abrams.




Vol 13 Issue 99

Pub: Dec 8, 2015

MILLENNIAL PERSPECTIVE--Watching condos overrun my hometown, I began to ponder my own gentrifying impact as a temporary resident of South Los Angeles. Each year, tens of thousands of students flood into the poor, gang-ridden area of South LA to attend the University of Southern California (USC). 

It’s an awkward image, an eighteen year-old jumping into his Maserati while mothers and their children dig through trash bins at the campus center. 

Years from now, USC will have displaced most of the latter demographic. Returning alumni, including myself, will hardly recognize the setting of their college memories. 

Recently, USC has taken huge steps in terms of altering South LA, undertaking what is arguably the most impactful development project in the area’s history. Officially breaking ground in September 2014, the USC Village Project will replace an inexpensive, unadorned shopping center with a $650 million hub of posh stores, restaurants, and student housing. Of course, the project means something very different to the USC student body than it does to permanent residents of South LA, most unable to afford groceries at the incoming Trader Joe’s.   

Thomas Sayles, the USC administrator appointed to handle community relations regarding the Village, has fervently contended that the project will serve the community, including perks such as local hiring, street lighting improvements, and the construction of a new fire station. Throughout the approval process, USC emphasized that the project will increase low-rent housing availability for local residents by providing more on-campus student housing. 

In reality, USC’s claim that this project will increase low-rent housing vacancy in the area lacks substance. For the 2015-2016 academic year, sample costs for living in USC residence halls, including parking, were quoted at $17,007.  Living in an apartment several blocks from campus, my total rent, parking, and utility costs will come out to less than $10,000 for the same school year. Certainly the USC administration realizes that students are unlikely to choose to remain in expensive university housing beyond the typical freshman year experience, rather than save thousands of dollars. While the university boasts the support of the local residents, this is clearly more of a public relations perk than a priority. 

The first rumblings I heard about the USC Village Project came in the middle of my freshman year, once I’d spent just enough time at this university to grow fond of the old “UV.” Here, a charismatic albeit rundown food court held dining options from an impressive variety of cultures. Sandwich Island, a personal favorite, was run by a Chinese couple who’d have your sandwich made before you could say “sprouts.” Sure enough, the USC Village will replace the only dining options near campus for less than five dollars, not to mention the only space that was truly shared between USC and non-USC-affiliated community members.   

As a student at a large, inner-city public high school in a neighborhood not so unlike South LA, I was exposed to the sort of homelessness, poverty, and crime that USC fears will deter potential students from enrolling. Being exposed to such harsh realities early in my life greatly influenced my perception of the world, marking my plans for the future with a sense of social responsibility. Unfortunately, I’ve found that USC students are much more divided from their neighbors than my classmates were from the people who lived around our high school. Remarks from my peers about the “dirty hobos” lining Figueroa are frequent. USC, as an institution committed to training future world leaders, should be focused on battling such fear and ignorance by building bridges between students and South LA residents, not tearing them down. 

Certainly, the USC Village will alleviate a few of the greatest challenges to the institution in its competition for academic status. The Village will make complaints about the lack of quality shopping and dining options around campus obsolete. The new “UV” will create a buffer between USC and the sort of senseless violence that took the life of a student who was on his way home from a study session in the summer of 2014.  It will, however, only increase the divide between USC students and the low-income residents of South Los Angeles. 

Here is a lost learning opportunity for young people to truly build a community with people from different walks of life. All in all, the USC Village Project is inconsistent with the university’s mission to teach students “to acquire wisdom and insight, love of truth and beauty, moral discernment, understanding of self, and respect and appreciation for others.”


(The author of this piece is a white undergraduate at the University of Southern California. She requested her name be withheld out of concern for retaliation.) Prepped for CityWatch by Linda Abrams.





Vol 13 Issue 99

Pub: Dec 8, 2015

ANIMAL WATCH-An elephant walking up Weidlake Drive to a late-night party on Saturday, November 15, at a house in Hollywood Dell, caused concerned residents to call LA Animal Services, LAPD and the Fourth District Council Office. As a result, Councilman David Ryu is asking for a report from LAAS on closing a “loophole” in the City’s exotic-animal permitting process. 

One neighbor reported being  “concerned that the elephant was agitated,” the Councilman said in a letter to the department that was read into the record by his Director of Policy and Legislation, Nicholas Greif, at the November 24 Animal Services Commission meeting. (Photo: Elephant at party example is from a Blake Edwards Hollywood party in 1968.) 

Representatives of the Hollywood Dell community were also present to testify. The first, Mary Ledding, described how perplexed she was by being unable to find a listing of issued permits on the LA Animal Services website. However, according to the Councilman’s letter, “…organizers of the party at 6447 Weidlake Drive said that they had a permit for the elephant. And they did.” 

Councilman Ryu wrote, “I find it hard to believe that our permit system for exotic animals is meant to be allowed for late-night parties in the City of Los Angeles. I do not believe that bringing an elephant up the rutted roads of this hillside street to a loud party is humane treatment …” 

Skip Haynes told the Commission he has lived in the area for over 15 years. He said he attended the meeting to support the LAPD Senior Lead Officers who responded regularly to “party house” incidents. He voiced concern for the animals and what will happen as a result of proposed development and the increasing number of “party houses” in residential communities -- houses that are not used as homes, but merely rented out for events such as this. 

Haynes, co-founder of Citizens for LA Wildlife (CLAW), said that on June 6 a similar party was held at the same house and a full-grown lion was clearly visible to neighboring properties. An earlier event involved a giraffe; and reportedly no proof of a permit was produced  He also voiced concern about the damage that can be done by large transport vehicles or, as in this case, walking an elephant on aging, narrow canyon streets. 

George Skarpelos, who serves on the Board of Directors of Hollywood United Neighborhood Councils, stated, “Using animals as 'props' in this manner is not the type of thing we want to see.”  He also expressed great concern over alcohol consumed at these events and how that may impact the treatment of the animals. He stated that Councilman Ryu’s office had promptly contacted LA Animal Services and asked that this item be placed on the Commission agenda. 

In a subsequent e-mail to Councilman Ryu, George Skarpelos wrote, “I believe the letter…sent to the commissioners was a forceful indictment of this ridiculous craze and certainly gave weight to the community's concerns.”  He also noted that Councilman Ryu’s policy director Nick Greif, “… gave very clear and valid reasons for restricting the permitting of these animals.” 

Senior Lead Officers Ralph Sanchez and Tracy Fields of the Hollywood Division voiced apprehension over how public safety is compromised when wildlife is used in a private party setting. They explained that, if any emergency arose in the area which required a helicopter and/or other emergency equipment to be brought in, there is a very real risk of the animal becoming frightened and out of control. 

Captain Martin Wall of California Fish and Wildlife advised me by phone that, while a company may have the proper permit(s) to provide wildlife for events, the animals and public safety are always the first concern. He agreed with the LAPD officers that an emergency could cause a chaotic scene in which the elephant could become alarmed and “stampede,” injuring itself and humans and also damaging emergency-response vehicles and equipment. He stated that the local jurisdiction can develop an ordinance to establish restrictions on how wildlife permits are used. 

I am withholding the name of the company (obtained from the Council office) which provided the elephant at the party, in order to avoid giving them free advertising. However, the services listed on their website include “Exotic Animal Rentals” and are vividly described on Google as the,“Cutting edge of extreme party themes and over-the-top events. Party, prop and exotic animal rentals…” 

LA Animal Services did not provide a written report at the Commission meeting. General Manager Brenda Barnette was present and confirmed that a permit had been granted, but she seemed uncertain as to the process or details. According to an attendee at the meeting, when they called Animal Services to report the incident that night, they were told by the dispatcher that only one officer was on duty and there would be nothing that could be done about an elephant at 11:30 p.m. 

Animal Services Commission President David Zaft issued the following statement in response to my request for the Board’s position on the concerns expressed by Councilman Ryu and residents about the City’s permitting regulations: 

"I and the other Commissioners were extremely concerned to learn that some individuals are bringing elephants, giraffes, lions and other exotic animals into our residential communities to use as party props. Such behavior manifests an outright disregard both for the well-being of these magnificent animals and the safety of our communities. 

“The Board has asked the Department of Animal Services and the City Attorney's Office to take swift action and propose changes to the Municipal Code to make sure this sort of reckless activity is stopped, while the humane and safe use of such animals for legitimate and limited purposes may continue when properly permitted." 

Councilman Ryu affirmed in his letter that, “It is important that our City maintain a clear and easy to use exotic animal permit system for legitimate filming purposes.” However, he added, if the purpose for which animals are permitted is “disrupting the quality of life of residents and the animals, then this is a loophole that must be closed.” 

For more information contact:  Phyllis M. Daugherty at [email protected].


(Animal activist Phyllis M. Daugherty writes for CityWatch and is a contributing writer to opposingviews.com.  She lives in Los Angeles.) Edited for CityWatch by Linda Abrams.




Vol 13 Issue 99

Pub: Dec 8, 2015

NEW GEOGRAPHY--When I arrived in Los Angeles four decades ago, it was clearly a city on the rise, practicing its lines on the way to becoming the dominant metropolis in North America. Today, the City of Angels and much of Southern California lag behind not only a resurgent New York City, but also LA’s longtime regional rival, San Francisco, both demographically and economically. 

Forty years ago, San Francisco was a quirky, backward-looking town, a haven for the gilded rich and hippies, a quaint but increasingly insignificant town. The Dodgers and the Lakers ruled the California sporting world. 

Today things couldn’t be more different. San Francisco and its much bigger southerly neighbor, Silicon Valley, have morphed into the global epicenter of the technology industry, with 25 tech companies on the Fortune 500. In contrast, Los Angeles County, which has almost twice as many people, is home to only 15 Fortune 500 firms total. 

Meanwhile, the Giants and the Golden State Warriors have become consistent winners while the Dodgers, Angels and Clippers disappoint and the Lakers are painfully unwatchable. 

Although there is a desire to repeat LA’s success with the 1984 Olympics and bring football back to town, that would only put a happy veneer over the city’s core problem: the long-term decline of its business sector. In 1984, the city had a strong and highly motivated business elite highlighted by 12 Fortune 500 companies who could help sponsor the games and provide management expertise. Now there are only three within city limits, with the departure of major corporations such as Lockheed, Northrop Grumman, Occidental Petroleum and Toyota, and the loss of hundreds of thousands of manufacturing jobs. 

In contrast, the Bay Area is full of thriving companies and successful entrepreneurs, many of them astoundingly young. Of the 30 richest people in the country, five live in the Bay Area; Southern California has only one, the Irvine Company visionary Chairman Donald Bren, and he’s in his eighties. The Bay Area accounts for the vast majority of American billionaires under 40; if not for Snapchat’s founders, Evan Spiegel and Bobby Murphy, as well Elon Musk, who lives in LA but spends much of his time working in Northern California, where Tesla and Solar City are located, LA would be off the list. 

This unfavorable contrast with the Bay Area, sadly, is not just a recent development. Since 1990 Los Angeles County has added a paltry 34,000 jobs while its population has grown 1.2 million. In contrast, the Bay Area, which added roughly the same number of people during the same time, gained a net 500,000 jobs, mostly in the suburbs. In 1990 Los Angeles had around the same number of private-sector jobs per person as the Bay Area, roughly 410 per 1,000; today Los Angeles’ private-sector jobs to population ratio has dropped to 364 per 1,000 while the Bay Area’s has grown to 415. Worse yet, while the Bay Area has increased its share of high-wage jobs to 33 percent since 1990, Los Angeles percentage fell to 27.7 percent. 

How LA Blew It in Technology 

As recently as the 1970s, as UCLA’s Michael Storper has pointed out, L.A. stood on the cutting edge not only in hardware, but also software. Computer Sciences Corp. was the first software company to be listed on a national stock exchange. In 1969, UCLA’s Leonard Kleinrock invented the digital packet switch, one of the keys to the Internet. 

In 1970, IT’s share of the economy in greater Los Angeles and in the Bay Area was about the same (in absolute terms it was bigger in LA). By 2010, IT’s share was four times bigger in the north than in the south. 

Storper links the decline in large part to the strategies of the biggest high-tech companies in the L.A. area: Lockheed Martin, Rockwell and TRW focused on defense and space, essentially becoming dependent on government spending. In contrast, the Bay Area technology community, although also initially tied to Washington, began to move into more commercial applications. In the process they also developed a huge network of venture capitalists who would continue to help found and finance fledgling firms. 

Today the San Jose area enjoys the highest percentage of workers in STEM (science technology engineering and mathematics-related jobs) in the country, over three times the national average. San Francisco and its immediate environs, largely as a result of the social media boom, now has a location quotient for STEM jobs of 1.75, meaning it has 75% more tech jobs per capita than the national average. In contrast, the Los Angeles area barely makes it to the national average. 

Southern California remains an attractive to place to live, but it’s hard to imagine it as the next Silicon Valley. L.A. had its chance, and, sadly, it blew it. 

The Growing Demographic Crisis 

Storper and other critics suggest that Los Angeles failed in part because it tried to maintain high-wage blue collar industries while the Bay Area focused on information and biotechnology. The problem now, however, are the factors in L.A. that drive industry away, such as ultra-high electricity prices and a high level of regulation. Even amidst the recent industrial boom in many other parts of the country, Los Angeles has continued to lose manufacturing jobs; Los Angeles’ industrial job count stands at 363,900, still the largest number in the nation, but down sharply from 900,000 just a decade ago. 

This decline places LA in a demographic dilemma. Like the Midwestern states that lured African-Americans to fill industrial jobs during the Great Migration, LA attracted a large number of largely poorly educated immigrants, mostly from Mexico and Central America. These people came for jobs in factories, logistics and home-building, but now find themselves stranded in an economy with little place for them outside low-end services. 

Although inequality and racial disparities also exist in the Bay Area, the issue is far more relevant in Southern California. The Bay Area’s population is increasingly dominated by well-educated Anglos and Asians. San Francisco’s population is 22 percent black or Hispanic; in Los Angeles, this percentage approaches 60 percent

Poverty and lack of upward mobility are the biggest threats to the region. In Los Angeles, a recent United Way study found 35 percent of households were “struggling,” essentially living check to check, compared to 24 percent for the Bay Area. 

recent study by the Public Policy Institute of California and the Stanford Center on Poverty and Inequality found that, once adjusted for cost of living, Los Angeles has the highest level of poverty in the state, 26.1 percent. Rents are out of control for many people who are struggling in an increasingly low-wage dominated economy. In fact, Los Angeles is now the least affordable city for renters, based on income, according to a recent UCLA paper. 

Is There A Way Out? 

Despite these myriad challenges, Los Angeles, and indeed all of Southern California, is far from a hopeless case. It is unlikely to become the next Detroit and is better positioned by natural and human resources than it’s similarly troubled big city competitor Chicago. It still enjoys arguably the best climate of any major city in the world, remains the home of Hollywood, the nation’s dominant ports and a still impressive array of hospitals and universities. 

At least some of the city’s leadership has begun to recognize the challenges facing the region. “The city where the future once came to happen,” a devastating blue ribbon report recently intoned, “is living the past and leaving tomorrow to sort itself out.” 

This recognition might be the first step toward a turnaround, but the area really has increasingly little control over its own fate. Today San Francisco and its immediate environs, despite its much smaller population, is home to virtually every powerful politician in the state: both its U.S. Senators, the Governor, the Lieutenant Governor and the Attorney General. Not surprisingly, state policies on everything from greenhouse gases, urban density and transit to social issues follows lines that originate in, and largely benefit, San Francisco. 

Most troubling of all, the local leadership seems clueless about how to resuscitate the economy, or even how this vast region actually operates. Neither another Olympics nor getting a football team or two will make a difference. Even worse is the effort by Mayor Eric Garcetti to densify the city to resemble a sun-baked version of New York. 

This has been part of the agenda for developers, greens and most local academics for the better part of 30 years. But the problem remains: Los Angeles, and even more so its surrounding region, is not New York, nor can it ever be. It is, and will remain, a car-dominated, multi-polar city for the foreseeable future. After all, the vast majority of Southern California’s population growth — roughly 75 percent — came after the Second World War and the demise of the Red Cars, LA’s  much lamented pre-war transit system. 

Some outside observers such as progressive blogger Matt Yglesias now envision LA as “the next great transit city.” Yet in reality, despite spending $10 billion on new transit projects, the share of transit commuters has actually dropped since 1990; today nearly 31 percent of New York area commuters take public transportation, while 6.9 percent do so in Los Angeles-Orange County. 

People take cars because, for most, it’s the quickest way to work. Few transit trips take less time, door to door than traveling by car, not to mention the convenience of working at home. The average transit rider in Los Angeles spends 48 minutes getting to work, compared to people driving alone, at 27 minutes. 

This reflects L.A.’s great dispersion of employment, which is not compatible with a transit-driven culture. In greater New York, 20 percent of the workforce labors in the central core; in San Francisco, the percentage is roughly 10 percent. But barely 2 percent do so in Los Angeles. The current, much ballyhooed revival of downtown Los Angeles then is less a reflection of economic forces, than the preferences of a relatively small portion of population for a more urban lifestyle and as market for Asian flight capital. Its population of 50,000 is about the same as Sherman Oaks or the recently minted city of Eastvale in the Inland Empire. 

Rather than seek to become someplace else, Los Angeles has to confront its key problems, like its woeful infrastructure, particularly roads, among the worst in the country, and a miserable education system. These are among the likely reasons why people with children are leaving Los Angeles faster than any major region of the country. 

Yet Los Angeles is not without allure. Overall Los Angeles-Orange has grown its ranks of new educated workers between 25 and 34 since 2011 as much as New York and San Francisco and much more than Portland. 

Perhaps most promising is the region’s status as the number one producer of engineers in the country, almost 3,000 annually. This raw material is now being somewhat wasted, with as many as 70 percent leaving town to find work. 

What Los Angeles needs to do is to provide the entrepreneurial opportunities to keep its young at home, particularly the tech oriented. As the Bay Area has shown, it is possible to reshape an economy based on pre-existing strength. For LA the best regional strategy would be based on a remarkably diverse economy dominated by smaller firms, a population that, for the most part, seeks out quiet residential neighborhoods and often prefers working closer to home than battling their way to what remains a still unexceptional downtown. 

One place where Los Angeles could shine is in melding the arts and technology. Unlike New York, which has relatively few engineers, Los Angeles still has the largest supply in the country. The Bay Area may be more appealing to nerddom, but is unexceptional in the arts. This revival will not come from the remaining suits in LA; roughly half of workers in the arts are self-employed, according to the economic forecasting firm EMSI. 

This entrepreneurial trend will continue since, with the studio system clearly in decline, as large productions go elsewhere, digital players such as Netflix, Amazon, Apple as well as Los Angeles based Hulu have become more important. Los Angeles could expand its arts-related niche by supplying the content that these expanding digital pipelines require. 

Given the corporate exodus, and the difficult California business climate, overall L.A.’s recovery must come from the bottom up, and be dispersed throughout the region. According to Kauffman Foundation research, the L.A. area already has the second highest number of entrepreneurs per 100 people in the country, just slightly behind the Bay Area. 

The next LA can succeed, but not by trying to duplicate New York or San Francisco. Instead there’s a need for greater appreciation why so many millions migrated here in the first place: great weather, beaches, suburban-like living and entrepreneurial opportunities. Only when the local leadership rediscovers the uniqueness of LA’s DNA can the region undergo the renaissance of this most naturally blessed of places.


(Joel Kotkin is executive editor of NewGeography.com and Roger Hobbs Distinguished Fellow in Urban Studies at Chapman University, and a member of the editorial board of the Orange County Register. He is also executive director of the Houston-based Center for Opportunity Urbanism. His newest book, The New Class Conflict is now available at Amazon and Telos Press. He is also author of The City: A Global History and The Next Hundred Million: America in 2050. He lives in Orange County, CA.) Prepped for CityWatch by Linda Abrams.




Vol 13 Issue 100

Pub: Dec 11, 2015