The Atlantic's survey of the most important cities in the world continues with the rich, wide, and dry metro of LA
Los Angeles is the second-biggest city in the United States, and 100 years ago exactly, it was also the second-biggest American for a relatively new technology known as the motion picture.
This latter silver-medal honor would turn to gold quickly. In 1910, Los Angeles annexed a newly incorporated community calling itself "Hollywood." In 1911, a cinema production company out of New Jersey opened a branch at the corner of Sunset Boulevard and Glover, becoming the area's first film studio. In 1914, a new director named Cecil B. DeMille directed Hollywood's first feature-length film, a silent western called The Squaw Man.
DeMille went on to remake that movie twice. By the year of the first remake, 1918, cinema's center of gravity had shifted from Manhattan to southern California, and Hollywood led the world in motion pictures. By the year of the second remake, 1931, everything had changed. Major studios produced more than 700 feature films every year, Edward Jay Epstein reported in The Hollywood Economist, and 95 million people -- or 80% of the ambulatory population -- went to the movies every week.
Los Angeles had bet on an industry. The bet had paid off.
One century later, California bet on another industry famous for slick agents, tragic story-lines, and computer-generated illusions. The industry was real estate. The bet didn't pay off so much.
In 2011, one-quarter of LA's homes were in negative equity, as the foreclosure crisis swept right through southern California. The city's unemployment rate was 11.4%, higher than any major U.S. city, not counting Detroit. Of America's 30 largest metros, only five actually shrank in population. One was Los Angeles.
Despite all this, LA is indubitably one of the most powerful cities in the world, in no small part thanks to the industry kicked off by Cecil B. DeMille in 1914. Today, entertainment is the city's largest cluster, employing 160,000 workers and drawing millions of tourists to the region each year to gawk at the hills and boulevards made famous by the legacy of Hollywood. Even with new technologies gnawing at studio's bottom line, 2011 saw entertainment employment numbers rise to a ten-year high.
Today Los Angeles is the third biggest city in the world, after New York and Tokyo, by total metro economy, and the sixth most powerful city in the world, according to the A.T. Kearney Global Cities Index. If entertainment is the soul of the city, finance, trade and aerospace are the muscle. Northrop Grumman and Boeing are two of the ten biggest private sector employers, with nearly 45,000 workers between the two of them.
After the housing mess clears up, the city's greatest challenge might be resources -- financial and topographical. Like much of California, the city is weathering a pension crisis that threatens to force cuts to major public services. At the same time, LA needs that money to manage a city that is very wide and very dry.
Los Angeles imports much of its water and the United States imports much of the oil families need to drive around the super-sprawl of the city. As oil prices climb and stay high due to global demand for a scarce resource, the city will have to find ways to provide cheaper, more mass transit to the kind of young professionals who provide the creative energy to power a major global city. Los Angeles already has one of the world's highest number of upper-middle class families. To become a destination for young people who increasingly prefer not to drive, it will have to find smart ways to move the city.