Mayor Tom Bradley calls Los Angeles “the most ethnically diverse city in the world,” and he’s surely right. Los Angeles is the new Ellis Island, the place futurists tout as the America of tomorrow. The demographic changes that are beginning to transform the rest of the country are here already. Just a decade ago, Los Angeles was largely white and homogeneous. Today there are no majorities. The 1990 census says the city is 40 percent Latino, 37 percent Anglo and 23 percent black and Asian. Thanks to immigration-legal and illegal-greater Los Angeles has nearly as many Mexicans as Monterrey, more Salvadorans than any city but San Salvador and the largest Korean, Taiwanese, Chinese and Philippine populations in the country. Nearly 100 languages are spoken in the city’s schools. More than 300,000 newcomers flood in each year, pitting blacks against Hispanics and Asians for jobs and housing in a city where both are scarce.

Los Angeles has not been a triumph for the melting pot, at least not yet. Even before the riots, it sometimes resembled a city under siege. Los Angeles is a town where merchants pack guns, where inner-city neighborhoods are divided into precincts with names like “Little Beirut” or “the Kill Zone,” where wealthy neighborhoods are fenced off and posted with warnings Of ARMED RESPONSE. “This is a bunker mentality,” says the head of one of L.A.’s 3,500 private security firms. Lacking any center, barricaded into nervous camps, Los Angeles has little common ground upon which its diverse citizenry can meet.

Nowhere in the country is the gap between rich and poor so evident, nowhere are racial or ethnic relations so complex. Mexicans mistrust Central Americans. Hispanics and Asians coexist uneasily in many neighborhoods. Black looters who torched Asian markets justified themselves as avenging perceived racism. Amid the social fragmentation, blacks are especially isolated. Once southern California’s ascendant minority, African-Americans represent only 13 percent of the city’s population, and that percentage is shrinking. L.A.’s Latinos, by contrast, doubled over the past decade, all but displacing blacks in Watts, home of the 1965 riots, and encroaching on African-American neighborhoods throughout the city.

There are no quick fixes to such profound social changes. Politicians will cobble together emergency economic and social programs. Ultimately, though, the solution to L.A.’s crisis will be the very diversity that now poses such challenges.

Drive down Melrose Avenue and you are struck by the city’s tremendous ethnic vitality-and its potential. Iranian and Russian restaurants vie with Jewish markets. Armenian exporters jostle Japanese importers. Thai Town gives way to Koreatown which gives way to Little Central America. This is more than a festival of international cuisine. These are thriving businesses with spreading links to greater Los Angeles and beyond. “L.A. is America’s first true world city,” says Safi Qureshey, a Pakistani immigrant whose company, AST Research, Inc., has become the third largest U.S. computer exporter.

You hear a lot of talk these days about Pacific Rim-ism, and how ethnic diversity is the key to the 21st century. In L.A., much of that talk is true. Malaysian or Thai businessmen in Los Angeles keep their links to their homelands. Commerce often follows. “This is the modern version of the traditional melting pot,” says Phil Burgess at the Center for the New West. “These new Americans learn English. They plug into the system. But they ‘assimilate’ us as much as we ‘assimilate’ them.”

Many of these successes are in neighborhoods that today seem so troubled. Asian communities are quickly vaulting into the middle class. If some Hispanic neighborhoods seem overrun with impoverished newcomers, others are becoming established centers of enterprise. Significantly, Hispanic neighborhoods were largely spared from rioting and looting. The reason is part economics, part ethnicity. Latinos and Asians have a stake in the city in a way that most blacks have not, explains L.A. sociologist Joel Kotkin. “They start more businesses and buy their homes. You don’t torch what you own.” What’s more, Asians and Latinos generally stay put once they make it, spreading their wealth to their neighbors. Blacks, by contrast, tend to behave like many whites. They head for the suburbs, leaving behind a black “community” of predominantly young poor.

That isolation must end if Los Angeles is to recover and prosper-and it may well end sooner rather than later. The wealth generated by thriving ethnic businesses will raise the communities around them. That day may be too far off for the rioters, but what’s encouraging is that so many Angelenos still managed to see that vision through the smoke of L.A.’s fires.