• printer friendly
• mail this article
• iPod format
• digg

By Scott B. Wong

Daily Bruin Contributor

California State Treasurer Philip Angelides spoke at the UCLA Law School Monday to 40 faculty members and students about how to promote growth in communities left behind in the state’s booming economy.

Angelides named former Laker superstar Earvin “Magic” Johnson, who founded a company aimed at inner-city retail, as an example of successful private-sector investing and said more investing was in order.

Angelides has been travelling statewide, promoting his initiative – “The Double Bottom Line: Investing in California’s Emerging Markets” – which emphasizes moving $8 billion of overseas state and private investments to low-income local markets.

“These are the best of times,” he said, referencing a familiar Dickens quote. “We live in the richest state and wealthiest nation on Earth.”

But despite the recent high-tech boom, there is a widening disparity between the rich and poor, which Angelides called: “The Tale of Two Californias.”

The solution lies in ethnic neighborhoods that have been neglected though having great economic potential and are growing exponentially, Angelides said.

“Four Korean American community banks are lending more than Wells and Bank of America,” Angelides said. “We now have a $20 million deposit with Korean American banks in Los Angeles.”

Private investors can also receive aid from the state’s pension, though this is rare.

“Magic Johnson came to the pension fund and was given $50 million to invest in inner-city communities,” Angelides said.

He added, however, that had it not been for Johnson’s celebrity status, the aid wouldn’t have been granted.

The lack of investments in these communities can be attributed to a lack of information, Angelides said because foreign investment opportunities are overshadowing opportunities locally.

“I am struck by the dichotomy that millions have been invested in overseas emerging markets, and that our own emerging markets have been overlooked,” he said.

The state treasurer said he wants to see California’s two largest pension funds – the California Public Employees’ Retirement System and California State Teacher’s Retirement System – to remain local, rather than to be invested in overseas. He proposed $5 billion of these funds to be directed to California’s struggling communities.

Professor Kenneth N. Klee of the school of law, who attended the faculty colloquium, said the design of the pension plan was a great idea and called it a “win-win program.”

“It is an enlightened view,” said Klee, adding the pension plan serves a greater social purpose.

Angelides was invited to speak at UCLA by friend and law school professor Ann Carlson. It was his second visit to the campus, having previously spoken last year at a public policy course taught by another long-time friend and former presidential candidate Michael Dukakis.