LA: Reducing the Racial Wealth Gap

LA has long been known for its class gaps. Unfortunately this is even more true when it comes to minorities, most specifically the blacks.  For example, a study last year found that while blacks make up 8% of the population in LA, at the same time they comprise 34% of LA’s homeless community.

In recent times though there has been a significant investment made by Blacks in LA towards programs and entities that are seeking to reduce the racial gap, at least on some level. One example of this can be seen in the efforts being made by (Multi Depository Institution) MDI’s OneUnited Bank’s CEO, Kevin Cohee. He recently noted that progress which is being made can also be linked back to the fact that when people of minority groups applied for loans, much was done online which obscured their identity and indirectly helped to create ‘the new Black Wall Street.’ A similar scenario, Cohee explained, has been happening in Tulsa, Okalahoma.

 “Why would Tulsa, of all places, be where you’d have found a place called Black Wall Street? You’d think places like New York, Philadelphia or some big Southern city like Atlanta would be where you’d fine that source of entrepreneurship and ingenuity. But it was in Tulsa this community called Greenwood developed, it being the only place I’m aware of where actual reparations were given. People actually got their 40 acres and a mule. It was a place that demonstrated that Black Americans would be given a fair chance.”

CityFirstBroadway’s CVP Tom Nida recognized how MDIs which have been at the forefront of community development have been investigating the wealth gap through the generations.  He pointed out how since the majority of African Americans do not own their own homes, that has the trickle down effect of them not being able to reap the appreciating home values benefits and thus building up their equities.  He believes that one way of dealing with this is to create private-public sector liaisons to ‘leverage available resources.’
 
It seems that the entertainment industry is also jumping on the racial gap reduction bandwagon too. Netflix recently invested $100 million into six Black-led financial institutions nationwide., as part of the its commitment to allocate 2% of cash holdings into banks serving Black communities.

RAS Comes to LA

Remote Access Service (RAS) has been utilized a lot more in recent years.  It is a way of facilitating and supervising of all network-connected devices; to easily troubleshoot; simplifying file access through connected networks and devices; delineating folder access for different user categories and through all of this, supporting business growth and development and more.

Since the start of the pandemic, remote working has become increasingly standardized. RAS users are being empowered to remotely access computers anywhere in the world and for office work evolution today, this is crucial.

The use of RAS is extremely widespread in LA today. One example being the InfoTech Services Group Inc. of Los Angeles which is providing this service for organizations and individuals throughout the LA and Venice communities. This includes the supervision, overseeing, management and more of computer networks. Those who use the service have encountered greater productivity from staff members working at home, enhanced cybersecurity, a reduction in overhead costs and more.

Another company providing this service is Remote Desktop. This IDrive remote access solution lets users access their computers and servers through Android, iOS, PC and Mac no matter where they are geographically located. 

Co-founder of Workr Beeing (a form that focuses on workplace wellness) Patricia Grabarek said:

“Research shows that a lot of employees can be way more productive when they are home. They are able to focus in and create an environment that is conducive to how they like to work. And research for decades has shown that if we allow employees to have autonomy over how they do their work, and flexibility in their schedules, they are much more likely to be happy in their jobs.”

This is exactly where RAS has been helping.

Easing LA Port’s Congestion

Unfortunately, over the last few months there has been a huge increase in backdated containers at both Long Beach and LA ports. This has caused tremendous congestion as shipping companies have not moved their containers fast enough at marine terminals.

One way of dealing with the issue has been to impose fines.  If the containers remain at the port for more than 9 days, the shipping companies will be fined each day thereafter starting with $100 for each container.   The fine will be more onerous for the containers that need to be transferred by rail and the penalties for them will begin after 3 days of being at the port.

The issue is a simple one of space which has resulted in an interruption to the global supply chain.  As it is a ruling was made to permit the port complex to work 24 hours a day to move the load.  Given that a disproportionate number of containers from outside of America end up in LA and Long Beach which come from abroad (approximately 40%) and the substantial increase in orders since the beginning of the pandemic, this problem has now gotten significantly worse.

The fact that the Biden administration has gotten involved by making this law is indicative of how important the ports are to America’s economy.

LA Startups

Los Angeles seems to be becoming the hub for early-stage startups.  Valuations are incredibly key to the success, especially pre-money ones which – in the first half of 2021 – increased 116%. While most US states saw substantial increases, the real jump was most significant in LA.

According to Kyle Stanford, Pitchbook Senior VC Analyst:

“Especially within hubs, such as L.A., competition for deals has grown considerably in recent years, with the flood of new investors and more capital looking to invest in startups. Los Angeles has, on its own, seen strong fundraising numbers, bringing more local capital to the ecosystem, expanding opportunities for the area’s companies.”

Two examples of this are JOON and LA Tango.  In July, the former raised a $2.3m seed and in August LA Tango raised $5.7m seed round. Today, there are approximately 5,000 startups in LA, many of which are in their early stages.

Is Local Banking Coming to Town?

Los Angeles has long needed a local bank.  The organization that has been fighting for this to happen is no took a break during the peak of the coronavirus pandemic and is now beginning to resume efforts with the LA City Council voting in favor of an investigation on how viable a city-owned bank would be, followed by the creation of a business plan.

Those in favor argue that creating such a bank would enable LA city to actually save banking fees as well as create additional credit access for SMEs, especially those in undeserved areas.  Further, the move could facilitate the financial backing of affordable housing and green energy programs.

While all of this sounds extremely positive, those who are not supportive of the move ask if LA city is able to manage such an institution.  Other cities (Philadelphia, San Francisco and Seattle) are also looking into the possibility of having a local bank.

Kids Returning to School: What You Need to Know

LA county is the second largest school district in America.  Hundreds of thousands of kids returned to school two weeks ago within the backdrop of the coronavirus pandemic. As such, the county is undertaking an extensive public health experiment whereby each student, teacher and school staff member have to get tested for Covid every week with no end in sight, regardless of vaccination status. Those who test positive stay home for at least 10 days.

Already by the end of the second week, LA Unified was reporting almost 3,000 active positive cases in their student and staff body, despite the fact that out of that only 7 cases were linked within the school setting. So no matter how hard everyone tries, it is very tough to keep it out.

With such difficulties, we have to look at the good that remains.  There are still many organizations trying to help others – which is needed even more at this time.  One example is the L.A. Education Recovery Fund which funded summer programs as well as important after- school programs run by dozens of L.A.-based nonprofits, including Woodcraft Rangers, LA’s Best, the YMCA and the Boys and Girls Club. These programs benefit more than 30,000 children (and their parents), many of whom come from underprivileged families. To date, $10m has been raised in capital by the organization and it hopes that it will add more programs in the fall.  

Another initiative is LA Tech Cares which has raised $200,000 for the LA Education Recovery Fund. LA county’s poverty rate is one of the highest in the state of California. The fact that venture capitalists did not struggle so much in the pandemic made raising the money much easier, according to one of LA Tech Cares’ founders and Crosscut Ventures Managing Director Brett Brewer.

Funding Secured for Infrastructure Improvements

More than $71m has been secured in federal funding.  This will be used for 20 projects throughout California. The projects still need to receive full Senate approval.

Senator Padilla explained:

“I’m proud to support projects that will strengthen our water infrastructure, improve our ability to fight fires, and help develop small businesses. I am constantly working to help meet the needs of California’s diverse population, economy, and geography. And in response to the current drought and wildfires, I will keep fighting to secure federal funding to increase California’s water resiliency and aid communities across California.”

In LA there was also cause for celebration by the Mayor who received approval for a $100 billion budget for the California Comeback Plan to help locals.  He said:

“These funds and many more will help us expand and implement programs that will have lasting, positive impacts on our city and our communities.  Thanks to our Los Angeles legislative delegation, our city secured some big wins. I want to thank our delegation and Governor Newsom for the important resources that will be coming to our community to address homelessness, housing, economic recovery, climate change, and more.”

Some of the money will be used for Los Angeles Department of Water and Power clients who have not been able to pay their bills due to the pandemic; expansion of summer youth employment programs; LA’s Gang Reduction and Youth Development Program; Enhanced pedestrian access at Louise Avenue 1010 Freeway; San Fernando Valley’s Roller and Skateboard Rink ; Potrero Canyon Pacific Coast Highway Pedestrian Bridge improvements and much more.

California: Employment, Unemployment and the Big Bad Coronavirus

It would have been nice if California’s unemployment figures would have dropped given the mass vaccine rollout. But numbers between May and June remained at a static 7.7%, a slight drop from April’s 8% figure.  Having said that, 73,500 jobs were created in June but only 24,500 people seem to have gotten them indicating that there are many thousands of open positions.

Governor Gavin Newsom however said that the local economy is “roaring back” given the number of jobs that have been created. But is this actually true? Not according to a recent report conducted by United Ways of California on the cost of living that illustrated just how hard it is for Californians to live with fiscal stability. Indeed, the report found that because housing and childcare costs have increased so much – and this has not been matched by a hike in salaries – a staggering 3.5million households where people are working cannot pay for their most fundamental needs. Thus CEO and President of United Ways of California Peter Manzo, said there is a clear need to broaden eligibility for safety net programs. 

What’s perhaps even more concerning is the fact that the report was not just referring to the pandemic but used data from up to five years before it started.  And it showed that there is a huge divide between California’s haves and have-nots that is only worsening.