No Justice, No Growth
From the perspective of the executive suites atop Universal's famous Black Tower, the demonstration that spread out on the lawn below at noontime on July 2 must have seemed passing strange. There were, of course, some irate homeowners protesting Universal's proposal to enlarge its theme park and theaters and CityWalk arcade, but irate homeowners are just the price for doing, or anyway expanding, business in L.A.
It was all those other people whose presence was disquieting. There was, for instance, Alex Angel, a 20-year-old kid who worked at Lowe's Cineplex on CityWalk, who called on Universal to make sure he and his fellow ushers had health insurance. There were veteran civil rights rabble-rousers like Cal State Northridge's Rudy Acuna and the NAACP's Zedar Broadus. Worse yet, there was Miguel Contreras, head of the L.A. County Federation of Labor, who promised to oppose Universal's expansion before the City Council and the county Board of Supervisors - the two bodies that had to sign off on Universal's grand design - unless Angel and his ushers and the 8,000 new employees who would work on the expanded CityWalk got their goddamn health insurance - and a living wage, whatever that meant. What did all that have to do with a land-use question like the expansion of Universal City? And besides, since when could Universal dictate to Lowe's what it paid a punk like Angel?
On July 2, then, the barons of the Black Tower discovered what the executives at Trizec-Hahn over in Hollywood and the airline honchos at LAX have also discovered over the past six months: that a new force has arisen in L.A. politics that is plainly determined - and may just well be able - to insist that a living wage (even a living wage for your retail tenants' employees) is as much a precondition for new development as a bulldozer and a construction crew. In a word, they discovered LAANE (the Los Angeles Alliance for a New Economy), the group responsible for the City Council's enactment last year of a living-wage ordinance.
What's become clear in the last couple of months is that last year's living-wage ordinance, which covered such city-contract workers as janitors and concession-stand employees, was just LAANE's opening salvo. Combining a keen instinct for political organizing with groundbreaking approaches to land-use and economic-development law, LAANE has become one of the most important forces - and surely the most innovative one - for social justice in L.A. Over the past year, it has been finding a way to collectively bargain for low-wage workers who aren't in unions, doing more to upgrade low-income jobs than anyone else in town. At the same time, it has embarked upon the conversion of L.A.'s growth coalition (long the exclusive province of business lobbies, building-trades unions and pols in their sway) into a growth-with-equity coalition - a transformation that challenges many of the bedrock assumptions that L.A. progressives have held for the past two decades.
Growth-with-equity coalitions don't exactly dot the American political landscape today. The very idea of mandating decent-paying service-sector jobs as a prerequisite for building shopping malls, hotels, theme parks and the like is a new one, and it is here in L.A. that it is getting its first test run.
The battle at Universal - a campaign in which LAANE has enlisted more than 60 unions, religious groups and community organizations - provides a good illustration of LAANE's ability to move L.A. labor relations on to terra nova. The labor-community coalition is calling on Universal to ensure that its theme park, and the theaters and franchises along CityWalk, meet local hiring requirements and pay their workers at least $7.39 an hour with health benefits or $8.64 an hour without. (Those are the living-wage thresholds that the City Council agreed to require of city contractors.)
Should Universal object that landlords can't compel their tenants to pay anything over the minimum wage, LAANE can point to a deal it's just struck at the other end of Cahuenga Pass with Trizec-Hahn, the developer that's rebuilding New York's Times Square and hopes to do the same to the area around Mann's Chinese Theater. Needing the approval of Hollywood-area City Council Member Jackie Goldberg, the author of L.A.'s living-wage ordinance, Trizec-Hahn has entered into a landmark labor-relations agreement with LAANE. It stipulates that the roughly 700 to 800 positions created to staff Trizec-Hahn's hotel and theater will be unionized. The company has also agreed to lease the shops within the complex to franchises that hire local Hollywood residents and pay them the living wage. To that end, the $12.5 million economic-development fee required by the city's Community Redevelopment Agency (CRA) will be used for a local hiring hall and for developing a low-dollar, high-benefit health plan in which all companies that have signed local living-wage compacts can enroll their employees.
At the airport, meanwhile, LAANE has been engaged in a long-running battle with the airlines that employ the security-check workers at the entrances to the terminals - workers whom the airline subcontractors offer the minimum wage and no benefits. To date, the airlines have rejected both LAANE's argument that these workers are covered under the city's living-wage ordinance, and Mayor Riordan's requests that they pay them the living wage anyway. Ironically, it was airport security and concession-stand workers who provided the shock troops for last year's living-wage wars, putting their jobs on the line to testify to the City Council about life on the minimum wage.
Now, the airlines may come to regret their hard-line opposition. Last year's living-wage bolsheviks have become this year's union-wage militants. A couple months back, the Service Employees (SEIU) began a campaign to organize LAX's 2,500 security screeners, while the Hotel and Restaurant workers (HERE) kicked off a drive to organize the airport's 1,000 food-concession workers. And last week, the national AFL-CIO designated the campaign as one of half a dozen around the country to which, on SEIU and HERE's behalf, it will devote its own resources.
Add up the workers at LAX, Trizec-Hahn and Universal, and you get nearly 14,000 service-sector employees that LAANE is endeavoring to catapult out of L.A.'s mammoth minimum-wage ghetto - almost half again as many workers as were directly covered by last year's living-wage ordinance. During the fight for that ordinance, the living-wage adherents' original position was that the law should cover not just city-contract workers but all workers on projects aided by the Community Redevelopment Agency. That proposal was quickly dropped when it became clear that it would impede the enactment of coverage even for city-contract employees. Now, however, the living-wage proponents are seeking on a project-by-project basis what they couldn't get adopted as citywide policy. And then some: Universal, after all, isn't vulnerable because it needs CRA funding, but because it needs council and supervisorial approval to expand.
But important as LAANE has become for finding new ways to represent low-wage workers, it is just as important for charting new directions for L.A. progressives. Nine years ago, when 1,000 left-leaning civic activists attended the Weekly's "Remaking L.A." conference at UCLA, the emerging consensus was that Los Angeles, then at the apex of the Reagan/Cold War boom, faced a crisis of both over- and underdevelopment. Enviros and progressive homeowners wanted a stop to sprawl, both upward and outward; inner-city advocates wanted investment redirected into neighborhoods devastated by industrial flight. Before a coalition for redirected growth could emerge, however, the Cold War abruptly shuddered to a halt, and the boom turned into the biggest bust L.A. had known in half a century.
In the ensuing decade, the L.A. left has lacked even the rudiments of a compelling urban vision, as the failed mayoral campaigns of its 1993 and 1997 standard-bearers, Mike Woo and Tom Hayden, at least partly attest. Now, another boom has arrived, and LAANE is laying out a progressive response to it that differs significantly from the "redirected growth" synthesis of the L.A. left of yore.
The difference may be clearest at Trizec-Hahn, where, at LAANE's suggestion, the economic set-aside mandated by the CRA won't be going toward such customary projects as inner-city housing, but to help retailers pay for health benefits for their employees. The progressive take on L.A. has to change, LAANE is saying. Our number-one problem is no longer overdevelopment and underdevelopment. It's our immense disparity in incomes. It's that we have become the simultaneous capital of shit jobs and insulated affluence.
The vanishing of the middle of the L.A. economy is, of course, the achievement of several decades. It vanished when the region's auto and steel factories closed down in the late '70s and early '80s; it vanished again when the local aerospace empire was cut down by more than half in the early '90s. It's been vanishing over the past 30 years as L.A.'s largely unionized construction work has become L.A.'s largely non-unionized construction work; as established supermarket chains have increased their percentage of part-timers, and new speciality chains have shunned unions altogether.
In recent surveys of economic equality, California and New York - once the bicoastal bookends of the New Deal order and its vibrant middle class - have ranked alongside Mississippi as the states with the greatest economic disparities, and it's been L.A. and New York City where those disparities have been greatest. But economic inequality in L.A. has an entirely different face than inequality in New York. In Gotham, the boom is confined to Wall Street and its upscale environs, while unemployment in the outer boroughs remains amazingly high. (In Brooklyn, it's still 10 percent.) In L.A., unemployment has subsided to 6.1 percent; more jobs are being created here than anyplace else in the country.
They are jobs, however, of the top and, even more, the bottom, not the middle. They are the minimum- or sub-minimum-wage jobs of the garment industry (the largest in the U.S.), of day laborers and housekeepers and fast-food workers. L.A.'s vast immigrant influx has enabled low-end employers to depress wages throughout entire industries and sectors - so much so that native-born Mexican-American men were making a lower percentage of the average white-male wage in 1989 than they were in 1959.
All these figures and trends have been public knowledge for some time, but there is one very significant new report that paints a devastating picture of economic life in '90s Los Angeles. The report is that of L.A. Assemblyman Wally Knox's Select Committee on the California Middle Class, and it compares data from 1994 and 1996 state tax returns - years in which the recovery was just beginning to pick up steam. Between '94 and '96, it shows, the percentage of L.A. County residents living in households where the annual income was beneath $20,000 increased by 13.5 percent - to 41 percent of the county's population. The percentage of residents in households making between $20,000 and $40,000 annually increased by 6.7 percent - to 25 percent of the L.A. population. By contrast, the percentage of Angelenos in households making between $40,000 and $100,000 annually declined by 7.7 percent - to just 26 percent of L.A. County, down from 30 percent only two years earlier. And this, it's worth repeating, was during a recovery.
The top, like the bottom, was booming. The percentage of Angelenos in households making between $100,000 and $500,000 a year increased by a hefty 29.7 percent, to constitute 7.3 percent of the county populace. And those in households making over $500,000 annually increased by a tidy 40.2 percent, albeit to constitute just one-half of 1 percent of county residents. (The wealthiest Angelenos of all, those in households making over $25 million each year, saw the market work true wonders: Their raw numbers increased from 65 to 143, a lovely 120 percent jump.)
The ghastly numbers of the Knox report help explain the ghastly numbers of another new report, that of the Washington-based Center on Budget and Policy Priorities, which looks at the national shortage of affordable rental housing and concludes that it's worse in L.A. than anywhere else. The number of low-income local renters, the Center concludes, exceeds the number of low-cost local rental units by a 4-to-1 margin.
It's figures like these that have produced over the last couple of months a notable reversal in the economic prognosis of two of L.A.'s leading economic commentators. Writing in the Washington Post and in a number of L.A.-based publications, Joel Kotkin and David Friedman have concluded, as some of their left-wing adversaries have been writing for years, that the boom may be lifting a number of boats but that a greater number seem to be sinking or at least bailing water. "Over the past two decades," Kotkin wrote in a recent L.A. Business Journal, "the trend toward growing inequality in Los Angeles and nationwide has once again become pronounced." For an economist who has previously argued, for instance, that local Mexican-Americans were experiencing long-term, if uneven, upward mobility, this marks a clear about-face.
Kotkin is probably best known locally for his vehement opposition to the living-wage ordinance and his criticism of the founding sponsor of LAANE, Local 11 of the Hotel and Restaurant Employees. While his analysis of the economy may be converging at least partly with theirs, he has shown no inclination at all to embrace their prescriptions. Nonetheless, it is chiefly LAANE and Local 11 - perhaps more accurately, only LAANE and Local 11 - that are remedying the plight of L.A.'s low-wage workers. The two groups are responsible for the only signal advances local service-sector workers have known in years: last year's living-wage ordinance and this year's Local 11 hotel contract, which boosted housekeeper base pay by 36 percent in many of the city's leading hotels.
Steering this emerging growth-with-equity coalition are three remarkable leaders. Hollywood-area City Council Member Jackie Goldberg moved the living-wage ordinance through the council last year, and it was she who insisted that Trizec-Hahn find a way to ensure that its retailers will pay a living wage as a condition for her approval of its project. Local 11 president Maria Elena Durazo took over a quiescent and corrupt union in 1989, cleaned it up, and built it into a militant and effective local whose new contract sets the standard for decent-paying service-sector work in Los Angeles.
The third leader, LAANE executive director Madeline Janis-Aparicio, is not nearly as well-known as Goldberg or Durazo, but it is increasingly she who provides the ideas and strategies that shape this growing movement. Holding up Universal's land-use permit to extract living wages, and building a broad-based coalition to that end; converting Trizec-Hahn's economic-development set-aside into a health-benefit plan for its retail tenants' employees; using the living-wage organizing at LAX to lay the groundwork for unionizing a hitherto unorganized sector of the work force - Janis-Aparicio has emerged as one of the most innovative and important strategists of the American liberal-left. The 38-year-old L.A. native is a UCLA law graduate who was the director of CARECEN, the immigrant-advocate group, from 1990 to 1993, when she became founding director of the Tourism Industry Development Council (which changed its name to LAANE a few months ago). Just before and after she worked at CARECEN, however, she was an attorney at the venerable firm of Latham and Watkins, where she worked under the legendary George Mihlstein, the number-one municipal lobbyist for business and real estate interests. At various moments when they've clashed in council chambers, she says, "I've told George he taught me everything I know."
Janis-Aparicio, Goldberg and Durazo are not the only actors in L.A.'s emerging growth-with-equity alliance. City Councilman Mark Ridley-Thomas has secured living-wage commitments from Magic Johnson's development company for its newly approved Crenshaw-area shopping center. AGENDA, the South-Central community organization headed by Anthony Thigpenn, has been trying to get the long-embattled DreamWorks project to guarantee the training and hiring of workers from L.A.'s low-wage precincts for some of its high-wage positions.
Beyond question, the most powerful figure working with the coalition is Miguel Contreras - the onetime HERE official (he's also Durazo's husband) who since 1996 has headed the L.A. County Federation of Labor. Under his leadership, the Federation has quickly become a political powerhouse - registering and bringing to the polls thousands of new immigrants as well as labor voters, pulling off a series of upset victories in legislative and ballot-measure contests, besting the mayor's slate to control the city charter-reform process.
Combine the coalition's strategies with Contreras' clout (or, if you prefer, with the power of the new labor movement), and a scenario for working-class upward mobility in Los Angeles becomes at least plausible. In a city that has lacked any such scenario for the past decade, that is no small thing.
But is Contreras unambiguously a creature of the new and improved growth coalition? Or is he just a repackaged business unionist, enlisting labor in the same old build-we-must alliance with corporations and developers that thrived during the last L.A. boom, when Tom Bradley presided over the reconstruction of downtown and the neglect of the neighborhoods?
In the late '80s, with high-rises springing up downtown and on the Westside, with worsening traffic and persistent pollution, middle-class liberals looked on the developer-union axis as the enemy, and Bradley as that enemy's most influential friend. It took some very deft backtracking on Bradley's part to forestall a challenge in the '89 mayoral race from Westsider Zev Yaroslavsky.
Now, the building boom is back again, and with it the potential for a new labor-liberal rift. At Contreras' prodding, labor backed the city subsidy for the Staples Arena. It is a major supporter of the expansion of LAX. It has joined with the two dozen CEOs of the Los Angeles Business Advisors to oppose elected neighborhood councils as an element of charter reform, for fear that they would block all major construction projects. Contreras himself co-authored an L.A. Times op-ed column last month with ARCO CEO Mike Bowlin that cautioned against such councils by railing about the imperfections and excesses of democracy - a strange-sounding argument from someone who's normally a critic of workplace autocracy.
Contreras was taken to task for this last position by the Greenest of greater L.A.'s major elected officials - state Senator Tom Hayden, whose mayoral candidacy last year the County Fed declined to support. Labor's new ties to the CEOs, Hayden wrote in a June 11 letter to Contreras, harked back to the bad old Bradley days, "when developers, downtown lobbyists and labor (especially the building trades) essentially ran things in the city . . . [resulting in] profitable overdevelopment in the Westside and Valley combined with deepening underdevelopment in the Eastside and South-Central."
Hayden's fears for the new labor movement may be justified - but only partly. At times, Contreras has indeed seemed the developer's best buddy, and by co-signing that attack on local democracy, has given aid and comfort to labor's traditional enemies while alarming some longtime allies. Labor may have well-grounded fears that neighborhood councils could lead to NIMBYism run wild, but Contreras should realize that labor also has the clout to ensure that some form of living-wage stipulations and limits on the councils' land-use powers be part of any charter-reform package submitted to the voters.
But despite Hayden's apprehensions, labor today is not simply the junior partner in the second coming of the growth coalition - nor is the misshapen character of L.A.'s growth the city's foremost problem today. Our most pressing and profound dilemma is the cancerous spread of low-wage work. And the traditional slow-growth opposition to development is no longer either adequate or germane to the city's single deepest need.
Until LAANE came along, development remained decoupled from justice, and liberals were spared the discomfort of having to balance the claims of the environment against those of income equity. But LAANE is here, and as its campaigns begin to change the character of local development and its beneficiaries, the middle class must rethink its time-honored aversion to growth. I am not suggesting that liberals abandon their traditional concern over pollution and congestion. I am suggesting that - at Universal, DreamWorks and even LAX - they also come up with a plausible alternative plan to create as many decent-paying service-sector jobs as the new growth coalition would create at that particular project. And that if they can't, they have a moral obligation to swallow hard and strike a deal with the dread forces of growth.
Indeed, the success of L.A.'s growth-with-equity coalition might ultimately prove as confounding for at least some slow-growth liberals - the ones who don't fully grasp what their city has become - as it would for right-wing business leaders. In a city whose middle has vanished, however, this is a problem devoutly to be wished.
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