What Business Can Do to Help Mend the City
When the looting stops, and the flames go out, and some kind of order finally returns to Los Angeles, the real challenge will begin: How to mend the city’s badly shredded economic fabric, the ultimate cause of its social ills.
And does anyone really believe there’s a solution that doesn’t include sweeping participation--more than ever before--by business owners, corporate executives, financiers and other Angelenos of great intelligence and means?
On Thursday, many Southland business leaders naturally reacted with horror to the riots searing the region. What may sound unnatural is that many of them now admit they have been a big part of the problem for the last two decades, by failing to invest in the poor of this city.
“We business leaders deserve to be criticized severely, because we have given up the moral high ground to the liberals” in the fight against poverty, says Joseph J. Jacobs, chairman of Jacobs Engineering Group in Pasadena.
The business community, Jacobs says, has failed to sponsor or press for creative solutions of self-help that would give hundreds of thousands of destitute people a stake in the free-enterprise system. Rather than a welfare handout, he notes, many of the poor obviously just want a shot at succeeding. “If we believe in the business system, we must be pro-active in bringing this system to disenfranchised people,” Jacobs says.
“I don’t think the business community or my own (Republican) party have focused enough energy on this problem,” adds Kip Hagopian, a well-known Republican booster and Los Angeles venture capitalist with Brentwood Associates.
The idea of big-business-sponsored action programs in the poorest sections of the city shouldn’t and can’t be “to make every (minority) just like us,” Hagopian says. “But we can certainly help people lead a decent life.”
The challenge that business must meet in Los Angeles, Hagopian says, can be stated in basic terms that any business person should easily understand: “How can we find a way to invest in these people?”
Indeed, Michael Tennenbaum, a financier with Bear, Stearns & Co., believes that many of the city’s corporations have failed to understand that helping the poor--not with handouts, but with training and education programs--is simply a good investment.
To ignore these people, “You’re wasting a resource,” says Tennenbaum, who has been active for years with South-Central L.A. youth clubs.
Then why haven’t more creative solutions been found to alleviate South-Central’s devastating poverty? Why haven’t more of the successful business people in West L.A., the Valley and Pasadena been willing to give their professional time and money to help the poor who genuinely want to help themselves succeed?
“I don’t think it’s a conscious meanness,” says Tennenbaum. “I think it’s just plain bad leadership.” Not enough of L.A.’s top minds, he says, have yet found a business leader or coalition they can unite behind.
But time is running out, he says: “Now’s the time to respond.”
Eli Broad, chairman of insurance giant Broad Inc., agrees. “The business community can’t just leave this in the hands of the elected and appointed officials,” he says. “We’ve got to get more involved and exert leadership. We’ve got to lead in the same way that we lead our companies.”
Tennenbaum sees more business-financed youth clubs in poor neighborhoods as one way to start. “It’s a way of giving safe haven to these kids,” he says. “It’s a place where they’re encouraged to do their school work, where tutors are available and where they can get emotional support.”
Jacobs of Jacobs Engineering wants to use his family foundation to begin a “micro-lending” program for poor minority entrepreneurs--loaning them the relatively small amounts of cash they often need just to get a car fixed or make some other investment crucial to the survival of their fledgling businesses.
Lawyer and venture capitalist Richard Riordan of Riordan & McKinzie wants to organize teams of business people to help burned-out South-Central enterprises fill out Small Business Administration forms for loans needed to rebuild.
And perhaps most important, all of these business leaders say they support the idea of a major business-community summit--and soon--to put all of these ideas and more on the table.
No single meeting can erase the damage done by 20 years of neglect, of course, but Hagopian says a business summit “would probably have value just because it would say people are trying.”
Is there a business leader out there with the guts, compassion and foresight to call that meeting within the next few weeks?
