L.A. jobs ‘czar’: One of Mayor Villaraigosa’s most important appointments

Unlike the Democrat in the Oval Office, the Democrat in Los Angeles’ City Hall seems to understand that -- the markets’ resurgence notwithstanding -- nobody is going to believe the economic crisis is over so long as more than one out of every 10 American workers remains unemployed.

Whether by reason of perspective or background, Antonio Villaraigosa, the onetime labor organizer, grasps what Barack Obama, the former professor of constitutional law, doesn’t: Out here in the country, it’s the jobs, stupid. That’s what makes the mayor’s selection of billionaire private equity investor and merchant banker Austin Beutner as L.A.’s new jobs “czar� one of his most significant and promising appointments. Beutner will be responsible for making sure job creation is the top priority across City Hall’s legendarily labyrinthine bureaucratic fiefdoms from here on out.

It’s a step that acknowledges a couple of realities: When it comes to putting people back to work, the Obama administration’s stimulus package is a bust. With L.A. County’s unemployment rate at 12.3% and joblessness in the city’s hardest-hit neighborhoods running as high as 20%, a lot of people in this town will endure much suffering while waiting for help from Washington. Similarly, nothing but additional misery in the form of cuts to welfare and healthcare can be expected from the cesspool of dysfunction that Sacramento has become. As historian Kevin Starr has pointed out, Gov. Arnold Schwarzenegger’s California is on the way to becoming something unique in American history -- “a failed state.�

We are, in other words, on our own -- and Beutner’s appointment is recognition of that fact.

But while Villaraigosa’s creation of a jobs czar is an innovative response to a challenging historical moment, the process leading up to it was very much a back-to-the-future exercise in traditional L.A. politics. Following his reelection, the mayor promised to make job creation the focus of his second term. After shaking up his staff, he charged his new chief deputy mayor, Jay Carson, and chief of staff, the Rev. Jeff Carr, with following up on the commitment, and they reached out to former Mayor Richard Riordan, asking whether he’d be willing to return to city government as the jobs czar.

Sources say Riordan, a highly successful investor and venture capitalist, agreed, but said he would want the autonomy to act independently of the mayor’s office. Discussions proceeded and -- five weeks ago -- Riordan convened a breakfast meeting of other leading financiers and businessmen at his Brentwood Park mansion. He hoped not only to solicit their ideas but to see whether some of them might be willing to come on board to oversee various city departments as they tried to create jobs. Among those who attended were philanthropist Eli Broad, financier Michael Milken, developers Steve Soboroff and Jim Thomas, Bill Allen of the L.A. County Economic Development Corp. and the 49-year-old Beutner, the Blackstone Group’s youngest partner and co-founder of Evercore Partners, a boutique investment banking operation. Carr and Carson represented the mayor.

In the course of the morning’s discussion, Beutner said in an interview Monday, he made the point that “absent the right leadership on jobs from City Hall, it wouldn’t matter what was done. Nothing could be accomplished.� That obviously resonated with Carr and Carson, who knew Beutner from their dealings on behalf of the Clinton administration. Over the next few weeks, the three met several times and Beutner talked with Villaraigosa.

“Our brainstorming turned into something more substantial,� Beutner said, “and I was offered the job,� which he accepted for $1 a year.

For his part, Riordan calls the appointment “a great step for the city. Austin obviously has had great success and has real street smarts as well. If anything, he’s an even better choice than I would have been.�

He’s also going to have to be a quick study. Villaraigosa has put him in direct charge of 13 city departments, including Planning and Building and Safety as well as the Convention Center, the DWP, the airport and the harbor. The latter three are particularly significant because they generate major revenues, economic activity and jobs. All these departments will report directly to Beutner, who is accountable directly to Villaraigosa.

Beutner said Monday that he has a mandate to do three things: First, to change City Hall’s inward-looking, often territorial culture, so that Los Angeles becomes a friendlier place for the sort of businesses that create well-paying jobs; second, to create a strategic vision of the city’s economic future by working with the City Council, labor and business; and third, he hopes to leverage the city’s purchasing power to entice more vendors to locate their businesses in Los Angeles. Finally, he wants to make sure that the jobs created will last.

“We don’t need to create apprenticeships for buggy-whip makers when we ought to be training solar power technicians,� he said.

In the process, he’s going to have to find ways to deal with the boards and commissions that, under the City Charter, govern most of the agencies he now will supervise. Nothing in the charter envisions an office quite like Beutner’s -- one with substantial authority created by mayoral fiat.

Still, these are desperate times, and Villaraigosa’s initiative is what the moment requires. Given its novelty, both he and Beutner will have to be as transparent as possible about their objectives and tactics as they proceed.

Most important, this has been a mayoral administration with a history of overpromising and underdelivering. There’s too much at stake to have that happen in this case.

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