Rebuild L.A. Official Urges Firms to Aid Inner Cities
Unless the nation’s corporations reverse the trend, “the cancer of disinvestment” in the nation’s inner cities “will eventually eat America alive,” one of Rebuild L.A.’s co-chairmen said Tuesday while estimating that last spring’s riots have cost Southern California’s economy $20 billion.
During a speech at the Biltmore Hotel, Bernard W. Kinsey said the situation is much more dire than after the 1965 Watts riots.
He said the neglected areas of Los Angeles County, meaning census tracts with 20% or more of the population living in poverty, equal 163 square miles with 2.5 million people.
“The events of April 29th have aggravated the deepest recession since the Depression,” he told an audience at a Town Hall of California luncheon. “It has shaken the business community to its core, foreign investors, tourism and convention business. It has accelerated the decline of residential and commercial real estate prices. . . .
“If you do not believe me,” he said, “try to sell your house.”
Kinsey reiterated estimates made last fall by a Rebuild L.A. consultant that it will take $5 billion in investments to get impoverished areas revitalized in the next five years.
“We are trying to put back into the community what has been missing for 35 years--jobs and capital,” he said, referring to Rebuild L.A., the special post-riot revitalization organization created by Mayor Tom Bradley.
Kinsey said that in the nine months since the riots, Rebuild L.A. “has helped facilitate over $300 million in commitments to the inner-city communities of the Los Angeles area.”
Among examples of local corporate actions that he said should be taken throughout the country, Kinsey cited a new loan program by Sumitomo Bank, a $1-million investment by Arco in Los Angeles’ only black-owned bank and a job training program by Shell Oil Co. He predicted that there will be many more such initiatives in coming months in Los Angeles.
Rebuild L.A.’s four co-chairmen, including Kinsey, have consistently said that they think the primary solution to the problems of the area’s poor neighborhoods is long-term, profit-motivated, private-sector investment, rather than government programs or other actions motivated by altruism.
But they also have encouraged Congress to enact legislation that would help stimulate investment in the inner city, such as the creation of enterprise zones where businesses would receive tax breaks. Last year, President George Bush vetoed a bill that contained such incentives and other urban aid.
Kinsey said he expects the Clinton Administration to be more responsive to the needs of America’s inner cities, including Los Angeles. Secretary of Housing and Urban Development Henry Cisneros on Sunday announced “a coordinated package of aid and federal help specifically targeted for South-Central Los Angeles,” Kinsey said. Cisneros did not say how much funding would be involved.
Just a week before Clinton’s inauguration, outgoing HUD Secretary Jack Kemp announced in Los Angeles that Rebuild L.A. had been awarded $3 million in federal funds stemming from legislation passed last year. Kinsey said that Rebuild L.A. planned to use the money to set up a small-business assistance program for loans in the $25,000 range.
After his speech, Kinsey met with a group of mostly black and Latino students from Compton High and Fairfax High.
In response to students’ questions about whether Rebuild L.A. could help them with job training, Kinsey consistently urged the students to find a way to go to college. “College,” he said, “is really the only way for anyone to get ahead in this country.”
