L.A.'s Tale Of Two Cities: Rich and Poor

Middle-class flight to the suburbs and lack of decent job opportunities are major factors

ALONG Rodeo Drive, Rolls Royces double-park while their occupants stroll into stores, some of which require appointments just to get in, to buy $10,000 Rolex watches and $1,000 bottles of cologne.

In South-Central, a 25-minute drive away, the closest thing to a Rolls is the Rolling Deuces, a local street gang, and Pierre Deux china is not something you find at the corner grocery.

Los Angeles, like much of urban America, is a tale of two cities - one wealthy and largely white, another poor and, in this city's case, largely black and Hispanic.

The problem here, as elsewhere, is that the gap between the rich and poor is growing. Thus, a major challenge facing the rebuilding of the nation's No. 2 city in the wake of the recent rioting will be to find a way to close that gulf or at least to prevent the underclass from growing.

It won't be easy. Los Angeles faces some of the same problems that other American cities have been grappling with: flight of the middle class to the suburbs, structural changes in the economy that produce service jobs, but not manufacturing jobs in the numbers that less-skilled workers can fill, and a federal government that isn't as benevolent as in the 1960s.

At the same time, however, this city is trying to cope with one of the largest waves of immigration in history, much of it from third-world nations, which magnifies language, education, and job-skill differences.

"I think you have a greater possibility for polarization here than in other places," says Jennifer Wolch, an urban expert at the University of Southern California.

A 1989 study by a group at the University of California, Los Angeles (UCLA), found that "inequality and poverty here are greater today than two decades ago. The growth in inequality appeared earlier in Los Angeles than the nation as a whole, and income disparity and impoverishment [are] currently more pronounced."

US Census figures released last week buttress that view. They show that the median household income in the city rose by 96 percent in the 1980s and the number of households making more than $75,000 rose 460 percent.

At the same time, however, the number of people living in poverty grew by 35 percent and the number of children living in households below the poverty level jumped 32 percent.

"The bottom line is that there has been economic growth, but it has left a lot of people behind," says Paul Ong, an urban expert at UCLA who directed the 1989 study. "The poverty rate for blacks and Hispanics is about three times higher than for non-Hispanic whites." South Los Angeles hard hit

The statistics are bleakest for South Los Angeles, epicenter of the recent rioting. The 1990 poverty rate for families in this area was twice the rate for the city and higher than it was at the time of the Watts riots 27 years ago. Unemployment among blacks runs as high as 50 percent.

Once the center of a thriving industrial core, South-Central lost more than 70,000 manufacturing jobs in the 1970s and 1980s as companies such as Goodyear, Firestone, and General Motors moved out. Many middle-class blacks moved with them.

Los Angeles, in the meantime, became a world-class corporate and financial hub, but few positions have gone to the ghetto poor.

Other jobs have been produced, but many are low paying and, with the massive demographic changes, competition for positions has inevitably increased.

In the 1980s the Latino and Asian populations almost doubled in Los Angeles. Hispanics now represent 40 percent of the city's population. The number of blacks, meanwhile, has declined to 13 percent.

These changes have been among the most stark in South Los Angeles: 81 percent black in 1965, it is 49 percent African-American now, with most of the rest being Latino. Koreans have moved to the helm of much of the area's retail trade.

While these changes have exacerbated divisions, other factors have contributed to poverty, too: drug abuse, deterioration of the family, racial discrimination, inadequate schooling, high housing costs. Polarization is cited

"In Los Angeles, the gap between rich and poor is felt more strongly," says Melvin Oliver, associate director of UCLA's Center for the Study of Urban Poverty. "This is not a place where people who make a good living don't show it. The people at the bottom see it every day."

Still, analysts such as Joel Kotkin of the Center for the New West believe the polarization between the haves and have nots here is not as bad as in some other cities that have undergone far less change.

There is, moreover, optimism that the city's vibrant small- and medium-sized manufacturing base, its central location to markets in Asia and South America, and the nascent commitment that has emerged in the wake of the riots will result in the kind of rebirth that proved elusive after Watts.

Economically, experts say, it will require not just the rebuilding of businesses destroyed, many of which were marginal anyway, but the creation of whole new industries. Some advocate a renewal program on the scale of what was done to downtown Los Angeles. Others urge development of an unprecedented small business network.

Most agree there will have to be worker retraining, revamping of inner-city schools, and better health care, plus new housing, parks, and recreation activities. One blueprint circulating - purportedly prepared by the area's most alienated group, gang members - calls for a $3 billion to $4 billion investment, a figure some don't think is too far off.

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