Commuters Benefiting From Jobs in L.A. Should Also Pay for Services

Do we have the right stuff to develop the type of public policies that will eliminate the major ills facing Los Angeles today? For the moment, probably not.

Most of us--including top scholars and policy-makers--don’t agree on what causes poverty, crime, drug addiction or child abuse, so it’s difficult to formulate appropriate solutions. Furthermore, the temptation for politicians to respond to the crisis of the moment, coupled with the general public’s demand for quick-fix solutions, creates shortsighted decisions that often have long-term adverse consequences.

Two good examples: the passage of Proposition 13, which has severely limited local governments’ ability to finance services, and the push in Los Angeles to hire 3,000 new police officers, which ultimately could drive the city toward bankruptcy.

It is time to step back and seriously contemplate how we build an economically viable city that promotes social equity and respects the environment. That means we need to develop a much deeper understanding of how the global economy has:

* Changed both the form and function of cities within our region.

* Concentrated poverty in the inner city, while furthering the schisms between minorities in South-Central and whites in the suburbs.

* Made it easier for employers to locate throughout the region, often eliminating job opportunities for L.A.’s immobile or less mobile minority residents.

* Rendered property and sales taxes at best insufficient--and perhaps obsolete--as a means of financing needed city services.

Los Angeles, after all, has changed dramatically in the last two decades.

In 1970, the city’s population was 2.8 million; today it is over 3.4 million. In 1970, there were 78 cities in Los Angeles County; today there are 89. There is growing competition between them for “clean” industries, high-wage jobs and upper-income housing--and a desire to limit the number of low-income, particularly minority, residents.

Taxpayer-financed transportation systems, meanwhile, have allowed a disproportionate number of high-income individuals--primarily whites--to live in relatively affluent “outer-ring” communities while working downtown.

*

The property taxes of these commuters don’t help finance services designed to address mounting inner-city problems. And the proliferation of outer-ring cities has perpetuated tremendous disparities between ethnic and income groups. The median household income in such cities as Westlake Village, Agoura Hills, Diamond Bar and Malibu is more than double that of Los Angeles and 2 1/2 times larger than that of South-Central residents.

Work, too, is moving away from cities toward the suburbs.

One UCLA study estimates that 70,000 stable, high-wage jobs left South-Central Los Angeles between 1978 and 1982 alone. As local employers sought alternative sites for their production activities, new employment growth nodes, or “technopoles,” emerged in the San Fernando Valley, the San Gabriel Valley and El Segundo. Minorities--particularly new immigrants--are shunted into minimum-wage jobs in dying industries.

The implications of these changes are still unclear. Will strategies aimed at restructuring aerospace or developing a new battery-powered car industry have any measurable impact on the wage level or employability of inner-city, minority residents? Will continued investment in infrastructure, such as commuter rail, truly enable inner-city residents to acquire jobs emerging in suburban rings?

*

The prognosis is not very good. And the fiscal prospects for the cities are not much better. Between Proposition 13, the exodus of the more affluent and California’s continuing recession, it is no wonder that Mayor Richard Riordan moved to increase airport landing fees to cover the costs of municipal services.

We must come to grips with four key factors:

First, Los Angeles not only competes globally, it also competes among its neighboring cities for high-wage jobs and economic generators. In many cases, new job creation simply means relocating industry from one city to another.

Second, unlike many other cities in Southern California, Los Angeles both houses and attempts to meet the needs of a significant number of low-wage earners.

At the same time, a disproportionate number of people who derive economic benefit from working in the city do not live in it--and therefore do not pay their fair share for city services. A commuter tax or regional revenue sharing is needed.

Finally, as RLA has reluctantly learned, local economic development means investing in already existing small businesses and community-based organizations. Low-income and minority residents must be involved in both policy formulation and implementation. Directing resources and policies toward larger corporations to stimulate the economy has not worked for the low-income residents of Los Angeles.