The North Versus the South
These are heady times for Orange County. Less than three years after its brush with bankruptcy, the county has emerged as the superstar of the resurgent Southern California economy, leading in job growth and lowest unemployment. For many, this success validates their decision to locate south of the fabled “Orange Curtain” separating them from trouble-plagued Los Angeles. Yet, increasingly the real Orange Curtain runs not along the two counties’ boundary but internally, between Orange’s wealthy, predominantly white areas, largely in the southern and coastal regions, and a generally poorer, heavily immigrant region concentrated in Santa Ana, Anaheim and other older communities. Between 1970 and 1990, the percentage of Santa Ana residents living in poverty grew from 10% to more than 17%; in Anaheim, it swelled from 6% to greater than 10%.
Since the early 1990s, as demonstrated by Cal State Fullerton’s Lily Fung and Anil K. Puri, higher-wage employment and its associated companies have been moving rapidly to the southern end of the county, leaving behind much of the county’s nearly 40% nonwhite population, up from 25% in 1980.
Real estate trends reflect these realities. Office-vacancy rates in the older markets in the county’s north have remained high, while plummeting in pricier markets south. Last year, residential property values rose twice as quickly in Irvine, Newport Beach and San Juan Capistrano as in Santa Ana, Fullerton, Westminister and Fountain Valley.
Changes in the county’s economy could further accelerate this widening chasm. Burdened with the highest industrial rents in Southern California and a high cost of living, Orange County’s economy is shifting from traditional manufacturing toward high-end “knowledge value” industries. In 1987, manufacturing accounted for nearly 17% of county employment; by 1994, it had shrunk to 9%. At the same time, high-tech, software and biomedical employment rose to levels well above such ballyhooed tech regions such as Raleigh-Durham, Seattle, Austin and San Diego.
This industrial growth has spawned tremendous opportunities for immigrant and minority workers, as well as for minority-owned businesses. But if critical education and developmental resources are not applied to the poorer parts of the county, the increasingly complex skills required for working in these industries could raise the internal Orange Curtain higher, thereby transforming a once decidedly middle-class county into a region divided between impoverished barrios and walled-off affluent enclaves.
How Orange County manages these problems will have implications not only for Southern California but also for the rest of the nation. Orange County epitomizes what some academics have termed “post-suburbia.” Although lacking a “core,” it offers residents employment, consumer and lifestyle options associated with more traditional cities. Its post-suburban pattern of development has evolved further than virtually anywhere else. The county boasts the nation’s fifth-largest population and a density among the highest in the nation, behind New York and Jersey City and greater than Los Angeles County.
As its economy has grown, Orange County has continued to try to maintain its long-cherished separate identity from its northern neighbor. For years, the county’s political and economic elites functioned as if little had changed since the times when the county was one of the most homogeneous middle-class regions in California.
The current reality could not be more different. On the one hand, the county ranks fifth among the nation’s metropolitan areas, second only to Santa Clara County in California, both in percentage of households with annual incomes exceeding $50,000 and in median household income. Spurred by growth in its high-tech sector, Orange County leads the nation in retail sales per household and is the home to the nation’s first- and second-largest Mercedes-Benz dealership, the third-largest BMW and the fifth-largest Rolls-Royce dealership.
The county’s rapidly expanding economy, on the other hand, has attracted many poorer workers who end up in construction, electronic-assembly and garment jobs, as well as at the lower-paid ends of the service sector. The county’s blue-collar employment doubled between 1970 and 1980 alone, and immigrant Latinos, and later Asians, made up the bulk of these workers; their salaries have continued to lag behind those of whites.
The great challenge for Orange County will be how to assure that the benefits of its sophisticated economy will be enjoyed by its rapidly diversifying citizenry. Changing attitudes may help. Although the old xenophobia remains, as evidenced in the county’s strong local support for Propostion 187, UC Irvine pollster Mark Baldassare maintains that the far right now commands the loyalties of less than 20% of the county’s voters. He describes the majority of voters as both fiscally conservative and socially tolerant.
This political evolution will have to continue if for no other reason than self-interest. To grow and prosper, information-age industries need to recruit both workers from the ranks of the educated, many of them socially moderate to liberal, and among minorities, immigrants and their children, precisely the people turned off by far-right xenophobic politics. The entrepreneurs who run the companies also realize that their industries demand a work force both technically sophisticated and fluent in English. Today, nearly one-third of Santa Ana’s population has less than a ninth-grade education, compared with roughly 1.5% in neighboring Irvine. Although Orange County’s high schools remain among the best in the nation, with the highest SAT scores of any major California county, many of its largest districts, heavily minority districts such as Santa Ana, Garden Grove and Anaheim, suffer from average SAT scores as many as 200 points below Irvine’s.
The importance of educating these minority youngsters soon will become apparent. Between 1990 and 1995 alone, the white proportion of the public-school student body went from 52.7% to 46%, while the Latino percentage rose from 31.5% to more than 37%. Perhaps more important are the patterns emerging at the lower grades: Nearly half the students are Latino, roughly 10% are Asian and 2% African American. Latinos now account for nearly 44% of all kindergarten students even in such districts as Newport-Mesa.
“There’s hardly any Caucasians left here but the very elderly,” observes Santa Ana realtor Pat Garcia-Velasquez, herself an immigrant from Nicaragua. People don’t want to come in here anymore. The more Hispanic the area gets, the more people want to move into areas that are non-Hispanic.”
Yet, people like Garcia-Velasquez represent the long-term hope for Orange County. Compared with minority populations in older eastern cities, and even in Los Angeles, Orange County’s growing Asian and Latino communities are more likely to work full-time, earn above the median family income and intermarry. Many are becoming business owners, accounting for roughly one of every four Orange County’s new businesses.
Perhaps most promising, nearly 40% of Latinos, and a remarkable 60% of Asians, own their own homes. “These are people who work for companies like Baxter and Disney but live here,” says Garcia-Velasquez. “Most of these people work and often have two jobs. I have seen their financial statements over the years. These are people who would rather not eat than miss a house payment.”
Such middle-class values, although not matched by incomes, translate into a different kind of politics, one less racially divisive and redistributionist than that practiced in many older cities. Local leaders such as Santa Ana Mayor Miguel Pulido emphasize attracting business, infrastructure investments and an already successful crime-reduction program. “The key is partnership,” he notes.
Cementing a partnership between northern and southern Orange County represents the single greatest civic imperative for the region. For one thing, leaving the north out of the county’s strong recovery represents an enormous squandering of increasingly scarce human resources. A surging Latino and Asian economy could prove very lucrative for local merchants. Between 1980 and 1990, the county’s Latino after-tax income grew from $1 billion to almost $4 billion; it is expected to nearly double again by the end of this decade.
The county’s long-term success depends on local business and political leaders, as well as the general public, understanding that spending some of today’s windfall to help pull down the internal Orange Curtain will reap enormous rewards in the decades ahead.
