California's San Gabriel Valley has been called an incubator for ethnic politics. Located a mere fifteen minutes from Los Angeles, the valley is a brave new world of multiethnic complexity.   Here Latinos and Asian Americans are the dominant groups, rather than the minorities they are elsewhere in the United States. Politics are Latino-dominated, while a large infusion of Chinese immigrants and capital has made the San Gabriel Valley the center of the nation's largest Chinese ethnic economy. The white population has dropped from an overwhelming majority in 1970 to a minority in 1990.   Leland T. Saito presents an insider's view of the political, economic, and cultural implications of this ethnic mix. He examines how diverse residents of the region have worked to overcome their initial antagonisms and develop new, more effective political alliances.   By tracing grassroots political organization along racial and ethnic lines, Race and Politics focuses on the construction of new identities, especially the panethnic affiliation "Asian American."