July 13 2025 - 4:00pm
Los Angeles politicians have long dreamt of their city overtaking New York as North America’s dominant economic center. Yet if LA is now becoming more like New York, it is for entirely the wrong reasons.
Radical anti-ICE protests that began last month have continued into July in California. This fury has only been exacerbated by the death on Friday of a man who was injured during an ICE raid on a cannabis farm. With nearly a million undocumented migrants living in LA, the city has become a natural setting for these demonstrations, while Mayor Karen Bass is seemingly opposed to any efforts to enforce immigration laws. The largely youthful demonstrators have habitually broken laws, attacked police, and set fire to Waymo vehicles. Radicals hail what they call “a student intifada”. One local political leader has even suggested the city’s notorious gangs join the fight against ICE officers.
How did it come to this? The decline of the higher-end economy has left LA’s roughly 50% Latino population in a dire state. The city was once a beacon of opportunity for migrants, but Latino incomes, adjusted for cost of living, and homeownership rates are among the lowest in the nation. LA’s poverty rates are the highest of anywhere in California and among the worst in the country, and it’s the immigrants who suffer most. One study from last year found that 41% of undocumented migrants under the age of 26 live in poverty. Undocumented households have a median income of $46,500, compared to $75,000 among all Angelenos.
What’s more, LA now suffers from a low-wage/high-welfare model, dependent on poorly-paid immigrants who rely on government support. The Congressional Budget Office warned last year that the “massive surge in immigration” in recent years will impact the salaries of low-income US workers, who compete with newcomers for living space, jobs and social services.
All this is a tragedy for the city, but a boon for Left-wing politicians. The Democratic Socialists of America, of which Zohran Mamdani is a member, already hold four seats on LA’s 15-seat city council. Backed by the all-powerful public employee unions, they have been able to apply pressure on the hapless Bass.
Many of the causes behind New York’s Leftward drift are also present in LA, such as a shortage of affordable rental housing. As in the Big Apple, this has galvanized not only the poor but also the struggling urbanistas who wish for the city to become denser. Meanwhile, in LA, every basic industry — from manufacturing to finance to business — has stagnated in the last half-decade, with significant growth confined to government-funded education and health jobs. Even the city’s signature entertainment industry is losing jobs as production moves to other states and countries.
Also similarly to New York, a restless underclass has grown out of Los Angeles’s failure to integrate many of its citizens. The city already suffers from sporadic crime waves, particularly downtown, including smash-and-grab riots, the vandalism of MTA buses, and theft of copper from street lights. The anti-ICE protests have only brought this into clearer focus.
The fiscal implications of this orgy of virtue signaling could be severe. Until the next election, sanctuary city policies will no longer be subsidized by federal transfers, forcing even the most dogged progressives to reconsider their generosity. LA, much like Gotham, already suffers from a deepening budget hole. Once the harbinger of a robust multi-cultural prosperity, Los Angeles is now taking cues from the East Coast on how to destroy a once-great city.
Joel Kotkin is a Presidential Fellow in Urban Futures at Chapman University and a Senior Research Fellow at the Civitas Institute, the University of Texas at Austin.
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