PERSPECTIVE ON LATINOS : Rebuild With the Working Poor : Last spring’s L.A. uprising pointed out the poverty but also the economic energy waiting to be utilized.

Nearly a year later, Los Angeles continues to grapple with the issues raised by the violence, arson and looting that swept through the city last spring.

While attention rightly has been paid to police accountability, most observers agree that frustrations over impoverishment were at the root of the uprising. Indeed, in areas where significant property damage occurred, poverty and unemployment rates are twice as high and per-capita income and home ownership half of that in the rest of the city.

In devising solutions, however, policy-makers must recognize one often overlooked feature of the uprising: It took place in neighborhoods with large Latino populations. South-Central, the hardest-hit area, is 45% Latino; in the most damaged neighborhoods (which include Koreatown and Westlake/Pico-Union as well as South-Central), the population is 49% Latino. The significance of the Latino presence is reflected in other relevant measures of the disturbances: 51% of the arrestees were Latino, 30% of those who died were Latino and up to 40% of the damaged businesses were Latino-owned.

Most current analysis focuses on the so-called “urban underclass” and attributes poor economic outcomes to joblessness and high rates of households headed by females. Latinos, however, do not neatly fit into this picture. While Latino unemployment rates exceed the city average, this is partly because so many Latinos are actively seeking work; in South-Central, 82% of Latino males are in the labor force versus 58% of non-Latino males. Entrepreneurship is similarly high, with the growth of Latino businesses ranking well above that of most ethnic groups. Finally, while households headed by females are even poorer than their African-American counterparts, Latino households are far more likely to consist of married couples with children.

Latino and Latina poverty, in short, is that of the working poor. The problem is not joblessness but rather inadequate wages and barriers to small-business development. The existence of large numbers of working and entrepreneurial poor suggests something desperately wrong with our economic system: People can do everything “right” and still be left behind. It also presents a danger: Groups whose economic dreams are continually dashed can soon be transformed into a discouraged underclass with far more intractable problems. For these reasons, the needs of the working poor should be central to new policy and a primary focus in improving Latino economic well-being.

Five directions for rebuilding are crucial. First, we must recognize and address the need to increase the wages and job conditions of Latinos and others. While higher educational levels will help lift some from the “low-wage” sector, an increase in the minimum wage and the encouragement of unionization would have significant immediate benefits for those left behind.

Second, small-business development should be actively promoted and supported, particularly through improvements in minority access to credit. Banks should support the development of “micro” loans and alter the collateral requirements that sometimes exclude small firms. The city and others could provide incentives by shifting deposits toward financial institutions with a good record on minority lending.

Refocusing policy may be difficult given the relative lack of Latino political power. In the 8th and 9th City Council districts, for example, Latinos are more than 45% of the population but less than 5% of the registered voters. Our third recommendation is to increase the citizenship/naturalization rates of Latino immigrants while providing opportunities for non-citizen participation in neighborhood planning.

Fourth, Latinos should seek to reconnect barrios that are separated by geography as well as immigrant and economic status. When Latino city leaders called for calm in April, 1992, they realized that they knew few, if any, Latino community leaders in South-Central. When a May 1, 1992, press conference by East L.A. political and community leaders called for calm and congratulated the Eastside for remaining relatively violence free, Latinos in affected areas, especially Central Americans, felt implicitly attacked. To repair these rifts, Latino leaders should convene residents of Los Angeles’ different Latino neighborhoods to set a common policy agenda.

Finally, Latinos should seek to work in coalition, not competition, with other ethnic groups and communities of interest. While Latino needs must be carefully defined, a narrow program will not be viable given the current low levels of Latino political participation and representation. A Latino agenda is necessarily part of a broader effort sensitive to the needs of various populations.

The Los Angeles uprising poses challenges for all of us. Latinos find themselves confronted with special dilemmas and opportunities. The underlying socioeconomic difficulties and the stark alienation of many Latinos from public and private institutions are now as evident as the divisions between new immigrants and established residents and leadership. However, careful analysis indicates that we have much to build on: Latinos tend to be the working poor, which suggests that the community’s fundamental economic energy is waiting to be utilized.

As the city begins its second year of rebuilding, public officials, private-sector leaders and community-based organizations should work together to ensure that the Latino population, severely affected by the violence, is also well-served by the attempted solutions.