The Next L.A. / Reinventing Our Future : ESSAY : Saying Goodby to Nostalgia : We need to spur new thinking and debate. We need a vision of where we are going.

The earthquake was the end of the beginning. For some years now, through recession, riot and fire, Los Angeles has been like a hypochondriac, taking its pulse every five minutes, asking itself what’s wrong.

Would it expire from a declining economy as defense spending dried up, or from an influx of diverse new populations, or perhaps from clogged arteries as words like “freeway” and “mobility” became merely ironic?

Even the movies were gloomy. In “Grand Canyon,” middle-class folk abandoned the city; in “Falling Down,” Michael Douglas suggested even engineers could go berserk.

Then came the earthquake, and it was a release of tension in more than geological terms. The city took a terrible hit, with loss of lives and property, but immediately its people knew Los Angeles would go on.

It was a shock of recognition. This is a big place, not limited by abstract political boundaries. If you live in the San Fernando Valley or Fountain Valley, you are connected to the whole; when friends and relatives call from across the country or around the world, they know you live in Los Angeles and worry about how you are.

Shaken but OK, you tell them, and the same goes for the city and the region.

Los Angeles has been through a life threatening illness--even hypochondriacs can be sick--and like any survivor, it is re-examining its values and behavior, thinking anew and determined to change.

But there is much confusion. For every problem, from transportation to the economy, there are many answers--from trains to telecommuting, local councils to regional authorities, agriculture on vacant lots to multimedia start-ups in converted garages.

The questioning is healthy, but priorities are wanted. We need to have a vision of where we are, what will be required, where the evidence says we are going and how we will come out. As the saying goes, there are no good answers, only good questions.

The fact is, Los Angeles is a world city that could become grander and more powerful in the next decade than it has ever been.

A historian would see similarities to Venice in 1300, as it was about to become the great trading city of the Renaissance world, or New York in 1929, about to become--despite the Great Crash--financial capital of the globe.

World cities are clamorous, incredibly diverse and energetic. That’s why people come to them. “If you are curious to see men from every part of the earth, go to St. Mark’s Square or the Rialto,” the French historian Fernand Braudel wrote of Venice in “Perspective of the World.”

Renaissance Venice, at the crossroads of Europe, the Middle East and Asia, made itself the warehouse of the world. Today international bankers and traders talk in similar terms of Los Angeles, at the crossroads of Latin America and Asia.

But nothing is guaranteed. For the Los Angeles region to fulfill its destiny, we will have to pay new costs and rethink old assumptions.

The aftermath of the earthquake will bring more than $7 billion in federal funds into this community. In truth, it will be only Southern California’s tax money coming back to it, but it’s a good bet that local taxes will rise to help pay for rebuilding roads and houses and providing jobs. Tax changes could even extend to the hallowed Proposition 13.

In pursuit of behavior modification--and public revenue--there may be charges for traveling alone in a car at rush hour. No free parking may become as axiomatic as no free lunch.

For industry and jobs, new thinking is imperative. Before the quake, Southern California worried about losing companies to the blandishments of other states, which wanted not only to create jobs but somehow to spirit away the technical and scientific brilliance that made this a region of advanced industry.

The earthquake hasn’t stilled those worries, but it has spurred fresh thinking. The future will see more cooperation between government and private business in Southern California as the region prepares for new industries and tries to bolster its position in international trade.

An example is the Manufacturing Technology Initiative, a federally funded project led by Rep. Howard Berman, D-Panorama City, who has persuaded Detroit Central Tool, a company skilled in computer techniques, to teach Southern California companies about new manufacturing in return for a chance to work with fuel cell technology developed by Caltech and the Jet Propulsion Laboratory.

Cooperation throughout the region, from UC Irvine north to the San Fernando Valley, is also needed as Southern California bids for the Advanced Transportation Research Center, a federally funded effort that would give work and know-how to underemployed aerospace subcontractors--and out-of-work engineers.

The Alameda Corridor, an improved rail and truck route to speed cargo through Los Angeles, is taking shape with cooperation of the Ports of Los Angeles and Long Beach and federal, state and local governments. But more will be needed: Two-thirds of the corridor’s $1.8-billion cost remains to be funded.

It would be an enormously fruitful, job-creating investment. Light industry would spring up all along the corridor from the Civic Center to the ports, predicts Joel Kotkin, a longtime analyst, author and teacher of business.

Still, all is not cooperation. The region’s entrepreneurs are as active as ever, pushing into the new multimedia fields which range from video games to digital software for entertainment, medicine and education. But they may not be getting a helping hand from big business in Los Angeles.

“Multimedia companies tell me that dealing with the movie studios is very difficult,” says Tom Turney of NewCap Partners, an investment bank that backs small companies.

To be sure, there is ferment with clusters of interactive video and video game entrepreneurs in Woodland Hills and Canoga Park, with the growth of innovative financing and with new thinking undoubtedly percolating in frequent meetings between Michael Ovitz and Bill Gates of Microsoft.

Unfortunately, to most of Los Angeles, multimedia can be a yawn. What do Hollywood deals, or, for that matter Caltech and computer-aided manufacturing, do for a city in which tens of thousands live in poverty--people for whom the information revolution promises only another low-paying job?

They do a lot. Economic development anywhere in the region can offer opportunity to all, especially if they have education to handle the work and transportation to get to it.

That’s the thinking that informs the economic policies of Mayor Richard Riordan’s Administration at City Hall. True economic development comes from creating jobs wherever possible, improving education and transportation so the poor can take the jobs and then providing social work to deal with the many other problems of poverty, from malnutrition to despair.

It’s a policy that reflects new thinking in other cities, notably Philadelphia, Cleveland, Jersey City and Houston, which are trying to get away from the often self-defeating system of interest-group politics.

Also, it’s a policy that fits the coming times, in the vision of futurist Alvin Toffler, who makes his home in Los Angeles.

Toffler sees communication being substituted for transportation wherever feasible, moving work close to people, relieving the burden on freeways and air quality at the same time. “A set of intermediate institutions will spring up, companies that facilitate home work and contract services,” Toffler says.

Such developments will put even more pressure on the education system--a California institution critically in need of new thinking--to prepare youngsters for independent, self-starting work.

Even more than the education system, or earthquakes and recession, there is another big issue looming over Los Angeles, and that is crime.

The problem is so acute that James Q. Wilson, criminologist, philosopher and UCLA professor, is frightened by it. As recently as 1980, Los Angeles’ crime rate dropped, Wilson notes, but it turned up again in 1985. It has many causes, drugs among them, he says. And a revived economy would alleviate the problem by giving young men jobs.

But crime, and many other problems of Los Angeles and other cities, demand new thinking about citizens’ obligations to live in harmony with their fellows. Wilson’s new book, “The Moral Sense,” attempts to define and reawaken very old and yet very new ideas: self-control, fairness, duty, morality. As much as on repairing freeways, Los Angeles will have to work on rediscovering those qualities.

New thinking is needed to get over the nostalgic illusion of Los Angeles as an idyllic seaside resort or a leafy small town; the city’s novelists, James M. Cain, Raymond Chandler, and John Gregory Dunne, never saw it that way.

This is not a village in Michoacan or Fujian or Kansas, it is Los Angeles. And perhaps it needs new bravado, too. In 1969 there was a billboard towering over Olympic Boulevard, advertising a radio station that said: “Smile Los Angeles, you’re the center of the universe.” There was no truth to the sentiment then.

Ironically, there is some truth to the sentiment today, but no one would think of putting up such a billboard. Maybe someone should.