L.A. Needs Boldness in City Hall

The economy of Los Angeles has serious problems that need fixing, but you wouldn’t know it by following the mayoral election.

Local companies have been complaining for years about the high cost of doing business here and City Hall’s lack of action to help existing businesses and attract new ones. Corporations nationwide grouse about congestion at the seaport of Los Angeles in San Pedro, and the neighboring port of Long Beach. To top it all, job creation in Los Angeles has been anemic in the last decade.

Yet none of these issues has been debated by the mayoral candidates: incumbent James Hahn or challenger Antonio Villaraigosa.

It’s as if the candidates buy into the claim that the mayor’s office can’t do much of anything because it has little political power -- that it is a “weak” mayoralty compared with those of New York, Chicago and other cities.

But on economic matters, that is just not true. The mayor of Los Angeles has more economic clout than almost any mayor in the country.

L.A.’s chief executive has power over the most important infrastructure in Southern California’s economy, whose $350 billion in annual output is larger than Switzerland’s.

For one, the mayor has direct authority over the Department of Water and Power, a utility that has $12 billion in assets and provides electricity to the city and has domain over water rights that reach to the Colorado River.

He also has authority over four airports, in that he assigns the commissioners who govern LAX, Ontario, Palmdale and Van Nuys. And he has authority over the port of Los Angeles, which last year handled almost $150 billion in imports and exports.

Together these operations form the basis of a regional international trade economy that accounts for more employment than any other local activity -- 465,000 jobs in transportation, handling, financing and processing.

Los Angeles City Hall has power to spare. The problem is, it doesn’t use it.

Case in point: The region’s international trade economy is facing dual threats. In the short term, congestion at the ports and on the roads is delaying shipments, drawing complaints from U.S. companies and foreign governments. The Los Angeles mayor, as the highest-profile elected official in the region, would be the ideal person to corral shipping companies, terminal owners, longshore and trucking unions and the major retailers around a table to find ways to speed the goods. But the Los Angeles mayor has not been notably involved.

Long term, the future of the region’s economy as a destination for passengers as well as cargo is endangered by a lack of capacity. Here the city of Los Angeles is in an ideal position to lead local governments, industry and environmental groups in appeals to Sacramento and Washington for support and funds to expand rail lines, roads and other facilities. But the city has not bestirred itself, and efforts to expand capacity are being led by two former Republican governors of California, George Deukmejian and Pete Wilson, and the state’s Democratic senior senator, Dianne Feinstein.

The infrastructure is crucial not just for Los Angeles but for the entire region. San Bernardino and Riverside counties in particular depend on the ports and transportation system; Inland Empire facilities transfer 50% of the freight coming through the area to destinations throughout the United States and into Mexico.

“It’s sad. Despite the enormous power the mayor has, Los Angeles has been slow on port expansion and has not organized strong participation by labor and business,” says Steven Erie of UC San Diego, an authority on California infrastructure and author of “Globalizing L.A.”

When something matters to the economies of New York and Chicago, you can bet that Michael Bloomberg and Richard Daley are in the thick of things. But when it comes to the economy of Los Angeles, the spokesman you’re likely to hear is economist Jack Kyser of the Los Angeles County Economic Development Corp.

How could the mayor’s office do a better job? Just getting out and cheerleading for local business and investments would be a start.

Los Angeles too often looks pathetic. The latest example is the state’s recent selection of San Francisco as the headquarters for a stem cell institute that will distribute $3 billion in research funds. Los Angeles, incredibly, wasn’t in the running because City Hall functionaries failed to complete the paperwork on time.

The mayor “should have been banging on the door in Sacramento, demanding that this city get some hefty part, $500 million or so, of that research work,” says Larry Kosmont, whose consulting firm specializes in urban economics. Los Angeles, after all, has two research universities, UCLA and USC, within its city limits and Caltech, whose president is Nobel biologist David Baltimore, in nearby Pasadena.

Of course, the mayor alone can’t be blamed for such fecklessness.

“The whole political establishment in Los Angeles doesn’t seem to care about losing or gaining jobs,” says John Husing, a Redlands-based economist who is an authority on the Inland Empire. The fact that employment hasn’t been debated in this long election campaign is proof of that.

It’s a shame because Los Angeles is a hard-working, blue- collar town filled with manufacturing industry, despite its image as a place where people mostly go to the beach.

The city is an entrepreneurial beehive of 5,000 firms. The apparel trade, for example, still employs 125,000 people. Most of the sewing machine jobs may have gone to Central America and China, but Los Angeles today has become a center of global fashion, helped by the proximity of Hollywood and the creativity of the world’s entertainment industry.

To be fair, City Hall has done some things for business. Last year it reduced the onerous business receipts tax, and recently it arranged special grants for movie and television productions that film in Los Angeles.

But with such great power, the officeholders on Spring Street should be out doing more. If they don’t, power that is not used can be lost. For example, regional experts are floating proposals for the state to take over the ports because their operation is crucial for so many regions.

The irony is that it was big, bold strokes by civic government that built Los Angeles into a great world city. Whoever is elected on Tuesday should remember that and take long strides for L.A. again.

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James Flanigan can be reached at jim.flanigan @latimes.com.