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California / News and Insight on Business in the Golden
State | HEARD ON THE BEAT / THE ECONOMY

Hope Lingers After Visit

Statistics Are Gloomy, but South-Central's Activists Aren't

January 14, 1998|DON LEE | TIMES STAFF WRITER

At one point during Alan Greenspan's brief tour of South-Central on Monday, one reporter shouted out, "Will lower interest rates help clean up this neighborhood?"

The Federal Reserve Board chairman couldn't help but break into laughter. As facetious as the question was, the reality is that the long period of low interest rates and economic expansion in the United States have touched many low-income communities, but much less so in South-Central.

This was evident in some new statistics that didn't come to light in Monday's community reinvestment forum in South-Central but were buried in the voluminous testimonies and reports provided by Greenspan and other regulators.

Consider:

Low-income areas in California have 5.4% of the state's population and 7.5% of the businesses, and those areas received 8.7% of the total dollar amount of small-business loans in 1996.

But South-Central, which contains roughly 2.5% of businesses in the Los Angeles metropolitan area, got just 1.6% of the region's small-business loan dollars.

South-Central is an area of 45 square miles where more than 500,000 people live, but there are only 12 bank and thrift branches. That's one branch for every 41,700 residents. The statewide average: one branch for about every 5,400 people.

The one bit of good news is that South-Central did get its share of home-lending dollar growth, increasing 28% from 1995 to 1996, about the same as the statewide increase in home mortgages.

Still, community activists in South-Central spoke of the symbolic importance of Greenspan's visit and the unusual forum that included members of Congress and top bankers.

And it seemed to infuse new hope that South-Central will catch up--if not with the rest of America, at least with other low-income areas.

"Those statistics, as gloomy as they are, they do not diminish or dim my enthusiasm," said Darcy Robinson, a 40-year activist in South-Central.

"This is the first step of a journey of a thousand miles," he said.

*

Don Lee can be reached at don.lee@latimes.com

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