Economic impact of coup would have had negligible costs for L.A.

Economic impact of coup would have had negligible costs for L.A.

In the affairs of the human race, the titanic events last week in the Soviet Union will probably become historic milestones, cited by historians for generations to come. Perhaps last week Soviet authoritarianism was shoved six feet deep for good. And, in the end, tyrants were exposed for what they always are - ghosts, dependent upon the fear of the unknown to survive.

In the affairs of Los Angeles commerce, however, last week's events in the Soviet Union were barely a footnote.

The Soviets and their satellite states - Georgia, Ukraine, Latvia, et al - have since World War II become just about the least important economic powers and trading partners in the Northern Hemisphere. They have been sealed behind a wall of repression, guaranteeing an economic backwardness that will take decades of repair.

True, there was the dream of a vast market that would be opened to Western goods, of a major economic force that would emerge on the world trade scene. But that's a vision of a future beyond barricades of economic backwardness.

In short, right now, when it comes to business, the Soviets don't count.

"Even at the worst, when it looked like the hardliners in the Soviet Union had taken over, I could see only long-term effects on the U.S. economy, but how much on the Los Angeles economy is debatable, and I didn't think it was going to be very big," said Michael Bazdarich, of MB Economics in Montrose.

He added, "Economically, a coup in Russia would have been about as important to us as a coup in Burma or Indonesia somewhere."

Trade figures certainly bear out Bazdarich's sentiments. The United States exported a mere $3 billion of goods to the Soviet Union in 1990, and imported the grand sum of $1 billion worth of goods. By way of comparison, the United States had a gross national product (the output of goods and services) last year of $5.46 trillion.

In other words, the Soviets sold the United States less then one-thousanth of what we consumed last year and purchased even less of what we produced.

The Soviet Union's midget economic status is underlined when the scale of Japan's influence is considered. Japanese companies own roughly half of downtown Los Angeles, including the twin Arco Towers and half of the First Interstate World Center, the tallest building on the West Coast. Thousands of Japanese companies operate throughout the Southland, either in their own names or by buying U.S. companies and factories.

Additionally, Japan sold the United States about $90 billion in goods last year and bought about $50 billion. At times, they have also financed the federal deficit, by buying Treasury bonds.

Should Japan and U.S. break relations, commerce in Los Angeles would be in for a major shake-up.

But man and woman do not live by bread alone, and therein lies an explanation of why the failure of Soviet hardliners is still important to Southland business leaders. The mood - the will - of leaders, and consumers, and government is important. A scared public is a non-buying public.

If Washington is abuzz with Soviet punditry, then domestic economic issues are going to get shoved to the back burner. If the Soviet hardliners had succeeded, President Bush and Congress would have spent time thinking about the unthinkable, and how to avoid it while not giving up an inch.

But all the war talk would have not been good for the economy, said Stan Plog, Harvard doctorate and founder of the Reseda-based Plog Research, a market consulting firm.

"A Soviet hardliner coup would have put a damper on people's attitudes about what they wanted to do, and what they were willing to do," said Plog. "An expanding economy needs a positive psychology on the part of investors and consumers."

If the threat of war between the Soviets and Americans had become more palpable, "The negative impact on the economy would not have been immediate, but it would have unfolded over time and it would have been very definite."

Too, the failure of the coup will allow Washington to spend more time on domestic issues - and perhaps send a signal or two that the national leadership does care about business in the hinterlands. "If they could really get a more favorable treatment for capital gains, or some encouragement from Washington to banks to ease up on lending policies - those would be positive signals," said Plog.

Still, perhaps one segment of Los Angeles suffered from last week's storybook ending in Moscow: Hollywood.

From "Red Dawn" to "Rocky XXXXXVI" to "The Hunt for Red October," the Russkies have been bogeymen for Tinseltown tale tellers. The military monster movies are going to have to come up with a new offending nation - how about that threat from Luxembourg lucre launderers, who are plotting to undermine the entire U.S. banking and political system?

PHOTO : Pacific Stock Exchange: Confidence temporarily shaken