Making the Good Old Days Look Good
Dad had it better.
He might have gotten his hands dirty at a factory, but he did well enough to pay the mortgage on a decent house and set the family up with good shoes and tuna casseroles. Three decades later, his son is a checker for a discount retailer, and even with a wife who also works, buying a house is nothing but a dream.
Dad had it better, and if you don’t believe me, let Paul Tepper tell you. The director of the Weingart Center in downtown Los Angeles just finished a study comparing today’s L.A. County economy to the one 30 years ago, and the news ain’t good.
“We may be headed toward a Third World economic model,” said Tepper, whose office is on skid row.
Between 1969 and 1999, the poverty rate in L.A. County went from 10.7% of the population to 17.9%.
Between 1975 and 1988, income jumped 66% for the wealthiest fifth of Californians and fell 25% for the poorest fifth, with L.A. County driving the widening gap.
You want more of the New Economy?
Median household income in the county was as flat as the L.A. Basin over the last 30 years. It was $42,189 in 1999, down nearly $5,000 from 1989, and level with 1969 earnings, and that’s adjusting for inflation. Health benefits? You know the story.
I don’t have to tell you what this means to home-buying prospects, but I will.
Because of astronomical spikes in real estate prices over three decades, the L.A. County homeownership rate was 73rd-lowest among the largest 75 metropolitan areas in the country. You have to earn about $77,000 to qualify for the median-priced L.A. County house, which will run you more than $300,000.
I’m not sure what you have to earn to buy Marvin Davis’ house, but the sale price helps illustrate Tepper’s tale of two L.A. counties. The billionaire philanthropist and his wife have just put their 26,000-square-foot Beverly Hills home -- with two other houses on the property -- on the market for $70 million.
Why not just donate it to charity and take the write-off? Beverly Hills could use a good homeless shelter and job-training center, and with 11 acres, two swimming pools and a tennis court, a couple of hundred people could probably find work on the Davis compound.
Actually, none of the Weingart findings about our haves and have-nots are shocking, given the decline of aerospace and defense contracting in L.A. County and the huge numbers of immigrants earning minimum wage.
But looking at what’s happened to the economy over a 30-year stretch, instead of in quarterly blips and burps, you get a striking portrait of economic stagnation for the middle-class and below.
We’re not entirely alone in this regard, and even as the national economy rebounds and there’s some hope for job growth, the question is this:
What kind of jobs?
Mopping up a spill on Aisle 6, that’s what kind.
The jobs that are left when manufacturers chase cheap labor out of the country and around the world. The jobs that are left when CEOs make obscene bonuses for squeezing every nickel out of employees, and passing dividends on to shareholders.
Even though unemployment in L.A. County dropped dramatically between 1983 and 2001, according to the Weingart research by Tepper and Jessica Barrett Simpson, so did the number of good jobs.
We lost 238,000 manufacturing jobs and gained 765,400 lower-paying service jobs. And eight of the top 10 jobs expected to have the most openings between now and 2006 (including cashiers, food prep workers, clerks, waitresses, janitors, security guards) have a mean annual wage range of $15,181 to $25,613.
“It’s a service economy writ large,” said Jack Kyser of the L.A. County Economic Development Corp., one of three pros who told me we’re falling down on the job of creating better jobs.
The valet who parks your car so you don’t have to walk half a block isn’t doing you or himself much good, says the Economic Roundtable’s Dan Flaming. “We don’t have enough jobs that use people’s best possibilities, and we don’t recognize the value of training and education in our welfare system.”
Paul Ong, of UCLA’s School of Public Policy and Social Research, said he’s glad Gov.-elect Arnold Schwarzenegger keeps talking up education, because schools will have to kick up their performance before there’s any hope of launching more grads into higher-paying jobs.
“We have met the enemy, and he is us,” added Kyser.
His chief criticism was that L.A. County has pronounced manufacturing dead, even though the patient could be brought back to life with some creativity and better coordination among the county’s 80-plus towns and cities.
“We’ve got retail coming out of our ears,” said Kyser, who upbraided city planners for shortsighted decisions to erect one superstore or shopping center after another. “It gets you the sales tax, but it creates crummy jobs.”
In the Downey area where he grew up, he said, the old Boeing property is becoming a retail shopping center with a Marshalls and a Kohl’s, and plenty of jobs that won’t get anyone up the ladder.
Tepper confessed he didn’t have all the answers. The point of the study was to chart three decades of fractured fate -- life at the top gets infinitely better while more and more people hang on for dear life -- and spark a conversation about why Dad had it better.
And more importantly, how to fix things for our children.
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Steve Lopez writes Sunday, Wednesday and Friday.
