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Julián Castro’s Troubling Record in San Antonio
While Castro may now boast of his progressive bona fides, his record shows a history of embracing austerity and neoliberal reforms.
If Castro is indeed the “Latino Obama,” it's because his early years in San Antonio replicated many of the ingredients of the former president's recipe for failure.
It was only a matter of time before Julián Castro threw his hat in the 2020 ring. Talkedabout as the “Latino Obama” for at least seven years now, Castro and his twin brother, current Texas congressman Joaquin, have long been slated for big things within the Democratic Party.
The moniker is more fitting than just a crude reference to the brothers’ future in an ever more diverse party. More than just about every other Democratic candidate in 2020, Castro is the quintessential Obama-esque candidate. Though thirteen years younger he is a young, ambitious Harvard Law graduate who entered politics at the tail end of the Clinton era (1997 for Obama, 2000 for Castro) and made a national splash via a high-profile Democratic National Convention speaking slot (2004 for Obama, 2012 for Castro).
More importantly, Castro absorbed many of the political lessons and much of the approach that defined both Obama’s time in the White House and the years preceding it: a technocratic, business-friendly style aiming to work squarely within existing political orthodoxy, stress consensus over class war, and one that often gave short shrift to the working class.
Despite being a major rising star in the party for around a decade now, Castro is somehow still something of an unknown. While his role in Obama’s cabinet is vaguely remembered today, little is known about the bulk of his political career: the decade spent in the city council and mayoralty of his hometown of San Antonio, the United States’ seventh-largest city. For those interested in finding out Castro’s governing style, ideology, and approach to politics, there’s no better place to look than this early incubation period.
A place at the boardroom table
Early profiles of the Castros were prescient. As the Los Angeles Times noted in 2005, the brothers were the successors to the Chicano movement of the previous century, eschewing the radicalism of the older generation and, to use the paper’s terms, “as comfortable in a boardroom as a barrio.”
Most biographies of the Castros start with their mother, Rosie, a Chicano activist in the 1960s and 1970s who co-founded La Raza Unida, a militant Chicano party that aimed to build political power for Mexican Americans, organized around workers’ rights, and was built on a deep, popular dissatisfaction with the Democratic Party. Rosie took the twins to farmworker rallies and strategy sessions, and ran for the San Antonio city council in 1971 on the Committee for Barrio Betterment slate — an election which she lost, but saw voter turnout jump twenty points from two years earlier to the still-unmatched 53 percent.
The Castros’ politics are not those of their mother, who once called the Americans who died at the Alamo “a bunch of drunks and crooks and slaveholding imperialists who conquered land that didn’t belong to them.” As Luis Fraga, a political science professor who taught the twins at Stanford, told the Times, while “in the early 1970s, you were either with the system or against the system,” the Castros “understand that that kind of dichotomy was false, that the deeper challenge is simultaneously serving the interests of both — communities that traditionally benefit from policy and those that don’t.”
After graduating from Stanford, the Castros went to Harvard Law, where they kept their eyes on politics. Julián submitted op-eds to the San Antonio Express-News defending affirmative action and warning the GOP about the electoral perils of its increasing hostility to immigrants. In 1998, the brothers worked for the city of San Antonio’s Neighborhood Action department, liaising between the city and neighborhood groups and homeowner associations.
According to a National Journal profile of the two, a year later they made a pilgrimage to see Lionel Sosa, the GOP’s point man in Texas, where they told him, “We’re going to be mayor of San Antonio.” When Sosa asked them to clarify which one, the reply was, “One of us will.” The Castros deny the anecdote. But as the profile pointed out, they had told a local reporter only two years earlier that they had even loftier ambitions: governor or even the US Senate.
The road to get there started at the San Antonio city council, which Julián began campaigning for in 2000. With Joaquin as his campaign treasurer, Julián solicited a total of $2,000 from his Harvard classmates as seed money. His employer — megafirm Akin, Gump, Strauss, Hauer & Feld, which Joaquin also called home — agreed to make room for his political aspirations, allowing him time off to attend to council business. The firm no doubt saw having an employee in San Antonio’s government as a good deal, given the numerous clients it had in the city.
At only twenty-six, Castro became the youngest ever member of the city council. Over his four years in the seat, Castro pushed for more funding for seniors’ meals, proposed a ban on all tax abatements for recharge land projects to prevent more development on such areas (which failed), put forward a ban on using cell phones while driving in school zones, pushed to allow city employees to buy cheaper Canadian drugs, and championed ethics reforms that for the first time put limits on campaign donations and loans in city elections. The thing Castro’s mother had fought for thirty years earlier — to sit at the table and make policy rather than pound on the door from the outside—appeared to have been fulfilled.
Early in his first term, Castro resigned from his relatively lucrative position at Akin Gump in January 2002. For Castro, whose wife is a public-school teacher, the decision was a genuine financial risk given the comparatively paltry pay of a council seat, and he later talked about falling behind on mortgage payments and coming close to foreclosure.
But Akin Gump’s large client base meant frequent conflicts of interest, forcing him to abstain from votes. And no vote was more charged than the battle over the proposed PGA Village golf resort on the Edwards Aquifer recharge zone, which would dominate Castro’s four years at the council and, ultimately, his mayoral run.
Out of the rough and into the green
The PGA Village saga was the issue that defined Castro’s early political career. The project’s evolution over the years mirrored Castro’s own transformation away from his early image of an idealistic, principled young politician standing up for the community against moneyed interests.
The PGA Village project was a 2,855-acre development proposed in 2001 by the Professional Golfers’ Association of America (PGA), Marriott Hotels, and Lumbermen’s Investment Corporation, with the finished project planned to feature homes, apartments, two hotels, and three golf courses. The problem was, part of the resort would be built over a recharge zone that replenished the city’s primary source of drinking water, the Edwards Aquifer, drawing the ire of local residents, activist groups, and environmentalists who were concerned about water contamination, and pitting them against the city’s business and developer community, including Akin Gump.
Owing to this conflict of interest, Castro initially sat out the issue, though having opposed tax abatements over the recharge zone in the past, it wasn’t difficult to figure out his personal feelings on the matter. In fact, Castro had previously said the city shouldn’t encourage any development on the aquifer.
In March 2002, Castro became the first council member to take a firm stand on the project, rejecting it. He called it a “golfopolis” and the “kind of creation I can’t support,” and decried the “corporate welfare” involved. He was one of only two city council members to vote against approving the project.
A hail of controversy led the PGA to withdraw from the project in August 2002, killing it, only for then-mayor Ed Garza to put forward a new, in some ways substantially worse, plan eleven days later. This time, through legal maneuvering, it would have neither public comment nor be subject to a referendum, the causes of the original project’s demise. Castro was again the sole vote against approving it.
The story typically stops here when retold. As Henry Cisneros, San Antonio’s first Latino mayor and something of a mentor and role model to Castro, told Texas Monthly in 2002: “I think Julián’s position on the council, especially on this PGA matter, has assumed the proportions of a long tradition in San Antonio … as the person of conscience.” Castro had been “the sort of protector of the grassroots, community-based person, who is willing to call it as he sees it no matter where everybody is, whether it’s the political community or the business community,” Cisneros said. When the LA Times covered the 2005 mayoral race that Castro was part of, it stated that he had “opposed and helped to kill” the project.
But this wasn’t the end of the story. Following two years of pressure from activist groups, the PGA again pulled out of the project in May 2004, after opponents charged the city’s agreement for the resort was illegal, owing to missed deadlines and undisclosed contract changes. Castro had called for the city auditor to investigate the contract.
But by this point the mayoral race was getting closer, and Castro couldn’t afford to anger developers. This time, having subtly moderated his stance on the issue, Castro remarked upon the pullout that “nobody won today,” and that he was “glad this division is behind us.”
But it wasn’t, because a month later, Garza and other officials revived the deal again. This time, opposition to the deal had weakened. Activists were exhausted after the previous fights, and city officials had cannily planned to hold public hearings and the council vote during the holidays, ensuring scarce attention and even scarcer turnout. The new plan reduced the amount of impervious cover — things like houses and concrete paths that keep aquifiers from absorbing rainfall and recharging — from 25 to 15 percent. But in exchange, the project wouldn’t be annexed into the city for twenty-five years. In other words, its developers would avoid paying the city’s property taxes for a quarter of a century.
One other thing had changed: Castro, previously the lone voice against the deal and development on the recharge zone in general, had now come around to support the project.
He flew to the PGA Tour’s (distinct from PGA of America, from which the PGA Tour had taken over the project the third time around) Players Championship course in Jacksonville and came back praising their environmental standards. According to the San Antonio Express-News, Castro’s image among the project’s supporters shifted from “obstacle to progress” to “champion for a major development.”
“People are saying how useful Julián has been, how impressive it is that he’s come around on this issue, and some members of the chamber community are echoing those sentiments,” one official involved in the meetings told the paper.
“I think we can both grow our economy and protect the environment with this agreement,” Castro said. Besides, he “honestly believe[d] this is scientifically better for the aquifer and better policy for San Antonio than the alternative.” He insisted to the project’s opponents that it was the best deal they were going to get, and asked them: “are you going to hold a grudge now and forgo something that is better for the environment, or are you going to let this pass and address the other issues sometime in the future?”
It was a far cry from his belief years earlier that there should be no development on the recharge zone, period.
“[Castro] wants to be mayor. He’s under pressure to be pro-development,” Graciela Sanchez of the Esperanza Peace and Justice Center, one of the groups opposing the project, said at the time, calling it an “about-face.”
In January 2005, the city council voted 10-1 to approve the project, even as new details were rammed into the agreement just hours earlier, including an extension of the tax giveaway from twenty-five to twenty-nine years. This time, the lone vote against was a different council member. At a public meeting, activists complained that the council was rushing the vote through.
Castro, previously mistrusted by business and pilloried in newspaper editorials, showed he could play ball with developers, just as the mayoral race was beginning and his opponents were raising tens of thousands of dollars from business interests. He had disappointed the activists for whom he had been a champion. But as San Antonio journalist Ken Rodriguez pointed out, they couldn’t abandon him: “To whom would they turn?”
“You’re not going to run away from your record”
Castro’s shift on the PGA Village fight were part of his general, politically motivated drift toward neoliberal politics.
Castro was the first council member to advocate for a ballot measure to permanently freeze San Antonio’s property taxes for seniors and disabled, even though the city already exempted the elderly from the first $65,000 of their home’s value, and the first $12,500 of a disabled resident’s home value. Rather than propose raising these thresholds, as San Antonio’s former city manager had the previous year and as city budget writers proposed, Castro favored a blanket freeze. This would chiefly benefit residents in the city’s North Side, where property values were higher, and only four of the city’s ten districts would see more than half of seniors benefit from the freeze.
City officials and others warned the plan could lead to cutbacks. At 24.7 percent of the city’s general fund, property taxes — which at that point hadn’t risen in eleven years — were its biggest source of funding. The city’s budget director pointed to Corpus Christie, which had instituted the same freeze and was forced to start slashing. (Under state law, municipal budgets had to be balanced).
The tax freeze also worked against Castro’s stated goals in government. The city was already facing consecutive budget shortfalls in the tens of millions, with city officials warning cuts would be necessary. Castro flatly refused to raise property taxes even as he called for an increase in funding for assistance to the poor in the face of growing homelessness, particularly among children. When Castro later helped pass a $52 million homeless plan, perhaps it wasn’t a coincidence that it didn’t actually commit any funds. (Incidentally, when the council later passed four laws aimed at criminalizing homelessness, Castro missed the vote.)
The freeze may have clashed with Castro’s stated desire for a more activist city government, but it was crucial to his mayoral ambitions. For one, seniors were a crucial and active voting bloc. But he was also courting right-leaning voters, touting his support for the freeze and opposition to a tax hike in districts loyal to his Republican opponent, Caroll Schubert.
“That’s considered fiscally conservative,” he said.
Once the race went to a runoff, and Schubert was knocked out, Castro continued to make a play for his supporters.
“I’m reaching out to Carroll’s supporters and noting our common commitment to lightening the load for taxpayers,” he said in an ad, comparing his record to Schubert’s.
Castro easily led the mayoral race for most of its duration, despite continuing to be hammered on his previous opposition to the PGA Village project and a couple of minor “scandals” that ranged from the hilarious (having his twin brother take his place at a parade while he attended a neighborhood forum) to the somewhat embarrassing (filing a shoddy, error-filled campaign finance report after making government ethics rules a cornerstone of his campaign). When business support swung to his chief opponent, retired Democratic appeals court judge Phil Hardberger, Castro complained the judge had “all of that developer money to attack my record,” even though he himself had courted developers in the lead-up to the race.
Though the two struggled to find any meaningful differences between each other, Hardberger eventually overtook Castro in the polls. Despite his attempts to court conservative voters, Castro continued to lack support in the city’s North Side, and a May 2005 survey found that only 67 percent of the Latino population was backing Castro — far less than the 96.9 percent that had brought Ed Garza to the mayor’s seat in 2001 or even the number who had won Cisneros the election two decades before that. Hardberger was able to pare off Latino voters based on his long history of civil rights work in the community.
In lieu of actual policy differences, Castro began attacking Hardberger’s record on the bench, running ads that criticized him for overturning various criminal convictions on legal technicalities — or, in Castro’s words, “turning convicted criminals loose.”
Castro called it a “clear pattern of bad judgment” and told Hardberger: “You’re not going to run away from your record. Those cases are important.” The county’s Republican district attorney even ran an ad calling the attacks “unfair and unfounded.”
Hardberger ultimately beat Castro by only three points, or 3,700 votes. While Castro had easily beaten him in majority Latino areas, just as polls had predicted, Latinos hadn’t fully swung behind Castro in the end. 35 percent voted for Hardberger, which USA Today called “a significant break” from the “past practice of giving near-unanimous support to the Hispanic candidate.” With Hardberger’s dominance in wealthier, mostly white wards, it was the crucial factor that sunk Castro’s run.
A hard lesson learnt
Castro’s chief takeaway from his 2005 loss was that it would be impossible to win the San Antonio mayoralty without the support of local business. When asked in 2007 what he would do differently, he said that he had “spent the last two years building bridges with folks who did not support my campaign in 2005.”
By the time his campaign got going in 2008, Castro was endorsed by and hired as treasurer Mike Beldon, a local businessman who had served in that position for Hardberger in 2005 and had been instrumental in securing him business backing that year. Beldon had previously chaired the Greater San Antonio Chamber of Commerce’s PAC in the nineties during a battle to prevent federal control of the Edwards Aquifer. He had also been part of that era’s “Majority of Six,” a pro-business group likened to the Good Government League of the 1970s, the political arm of the city’s business establishment whose iron grip on the city council Castro’s mother had ironically tried to beat in 1971. With Beldon on board, Castro got the support of several local businesspeople and developers.
“He’s broadened his horizons,” Beldon said of Castro. “He knows that he must be a mayor for all of the city, not just one area.”
“They know I don’t have horns now,” Castro said about how the hiring would impact his business standing.
He promised to continue “the progress that San Antonio has made under” Hardberger. Besides Beldon, Hardberger’s former campaign manager came on board to run Castro’s bid for office.
Castro now also had a substantial sum from his personal wealth to invest in the race, allowing him to claim he would be free of “undue influence.” In the years between his campaigns, Castro had received an undisclosed seven-figure referral fee from local personal injury lawyer and influential Democratic donor Mikal Watts, after passing a client with a potentially lucrative lawsuit on to Watts’s much bigger firm. Castro lent his campaign $215,000 in 2008, and in April 2009, Watts held a fundraiser for the former councilman.
Castro said all the right things. He expressed regret for being so “strident” on the PGA Village issue and insisted he had done “what I thought was right” when switching on the issue. Even as the city manager ordered city departments in February 2008 to plan for budget cuts of 2 percent in response to economic recession, and Castro warned that the “city’s going to have to tighten its belt the way families are having to tighten their belts across the nation,” he tentatively backed tax cuts.
In meetings with business leaders, Castro promised not to use the mayor’s office to empower unions. While Castro backed the right of non-uniformed city employees to “meet and confer” with the city manager, something unanimously approved by a 2008 council vote, he stressed that “it’s non-binding, it’s not collective bargaining,” and opposed granting such rights to civilian city employees. Nonetheless, he received the endorsements of several local unions, including the San Antonio Police Officers Association.
He easily trounced the competition. Raising $373,000 over his run, a combination of business and small-dollar support, Castro far outspent his opponents. Citing his “significant” newfound business backing, willingness to expand nuclear energy production, and opposition to collective bargaining, the Express-News now endorsed him, and he increased his support in the wealthier districts he’d previously lost.
Taking care of business
Evaluating Castro’s time as mayor is tricky. For one, there’s the nature of San Antonio’s “weak mayor-strong manager” structure, where the task of actually running the city falls to the city manager. The mayor, whose power and influence rests on a few added responsibilities and the bully pulpit, is more like the most prominent member of the city council.
Besides the mayor’s lack of power, it’s hard to separate local developments from wider trends at the state and federal level. So City Lab noted that while San Antonio enjoyed job growth under Castro, who in 2010 had set the ambitious goal of creating twenty thousand jobs, this growth also tracked with wider trends seen in Texas and the wider US at the time.
Still, there is enough in Castro’s time as mayor to give a sense of his politics.
Castro’s signature mayoral accomplishment was his “Brainpower Initiative,” later changed to “Pre-K 4 SA” and passed by ballot measure in 2012. The initiative raised the sales tax by an eighth of one cent to pay for extending early childhood education to thousands of mostly impoverished four-year-olds. Castro initiated and relentlessly campaigned for the measure.
As admirable as the measure was, it also reveals much about Castro’s politics. Despite the pushback it received from anti-government zealots like the Heartland Institute, Pre-K 4SA was very much a pro-business measure that enjoyed broad support and was funded through a small but regressive tax increase.
It had been devised by a “Brainpower Initiative Task Force” put together by Castro, and led by Joe Robles, Jr., the CEO of financial services firm USAA , and Charles Butt, the CEO of supermarket giant H-E-B, who, together with his company, fundraised and put more than $300,000 toward an ad blitz that helped push the vote over the top. It got the backing of the city’s biggest employers and seven local chambers of commerce, and Castro justified it as an investment in a future workforce, saying, “You can’t be pro-business unless you’re pro-education.” Even Ted Cruz didn’t oppose it in a 2012 debate between the two men.
Castro also led the creation of one of the country’s strictest anti-smoking laws, drafted a successful resolution denouncing Arizona’s racist 2010 immigration law, supported extending benefits to same-sex partners of city employees and, after years of reluctance, eventually supported an update to anti-discrimination protections to include sexual orientation.
He successfully pushed to further tighten campaign finance and ethics rules (ones Castro, ironically, would later run afoul of when it turned out he hadn’t disclosed the $27,000 worth of trips he’d taken from third parties like H-E-B and the Greater San Antonio Chamber of Commerce). And in keeping with Castro’s emphasis on creating “a stronger brainpower community,” there was also Café College, a center funded by the city offering free guidance and resources for San Antonians getting ready to go to university.
The other jewel in Castro’s crown was his push to develop the city’s downtown area and revitalize its poorer neighborhoods like the East Side. Castro wanted to “create a brainpower community that is the liveliest city in the United States,” resting on “economic development, matched with a well-educated workforce that’s prepared for twenty-first-century jobs and a city that is exciting to live and work in.”
To this end, he drew up the ambitious SA2020 plan for the city’s future and pushed for numerous development projects as part of his “Decade of Downtown,” to make the city a more vibrant living space. He had the Economic Development Foundation (EDF), a nonprofit bankrolled and peopled by the city’s business interests to lure capital to the city, draw up a strategic plan on economic development, which he said would “get us where we need to go.”
And Castro’s San Antonio made some steps forward on clean energy. He created a Green Jobs Leadership Council stocked with corporate leaders, and voted for an incentive package to bring solar panel maker Nexolon America to the city. The CPS Energy (City Public Services, San Antonio’s publicly owned energy utility) invested $50 million in alternative energy research and signed a deal for the world’s largest solar installation, approved energy efficiency upgrades to three landmarks, lured green tech companies to the city, inked a deal to build five solar plants, and pledged to close one of its coal plants by 2018, which it just followed through on.
Castro told City Lab in 2013 that his approach to economic development was to “focus on twenty-first century industries” like the health sector and “the new energy economy.” He expressed his goal for San Antonio to become for clean energy “what Silicon Valley is to software and what Boston is to biotech.” He was lauded as a rising star with a “strong green streak.”
What Castro didn’t mention was that this this clean, green surface rested on a dirty foundation. San Antonio, like much of Texas, relied on a drilling boom in the Eagle Ford Shale, an oil and natural gas basin that spanned more than twenty counties, and which helped turn Texas into one of the world’s biggest oil producers. “This is the kind of moment that comes only once a century,” Castro told the San Antonio Clean Technology Forum about the Eagle Ford’s economic potential, having already brought thousands of jobs to San Antonio. Unfortunately, its exploitation also put the United States on its current road as the world’s worst carbon polluter behind Saudi Arabia, and contributed to the city’s poor air quality.
Nonetheless, Castro was eager to take advantage of it. “We have an unprecedented opportunity if we can train our workforce,” Castro said, complaining that “capacity now is not where it needs to be” and calling for high schools and universities to do more to make sure locals were trained for oil industry jobs. He applauded the arrival of oil-field services companies like Halliburton to serve Eagle Ford drillers, declaring that “San Antonio is the place to be for companies servicing the Eagle Ford shale play.”
This was Castro’s “new energy economy”: continued investment in and promotion of oil, natural gas, and “clean coal,” partnered with a movement toward alternative energy for electricity production. In other words, it was Obama’s disastrous “all of the above” energy policy, but at the municipal level. And despite it all, as of last year, CPS still only plans to transition to renewable energy over the span of decades.
Despite stressing health care as chief among “twenty-first century industries” he wanted to focus on, Castro also left out San Antonio’s continued reliance on the military industrial complex. By 2011 the military’s economic impact in the city was measured at $27.7 billion, larger than any other sector. And Castro wasn’t a passive beneficiary — after the US Cyber Command announced plans in 2009 to hire one thousand cyber experts, Castro co-signed a letter with the head of the Greater San Antonio Chamber of Commerce asking for them to be headquartered in the city. A year later, he accompanied the Chamber on a four-day lobbying trip that included stops at the Pentagon. “San Antonio is producing the brainpower in the twenty-first century to defend our nation,” he told a cybersecurity conference held by the St. Mary’s University Center for Terrorism Law.
Castro’s approach to job growth often involved the kind of corporate giveaways typical of today’s Democratic politicians. A month after insurance company AllState announced it was opening up a bilingual customer information center in San Antonio, receiving $1.1 million from the state government for the trouble, Castro backed and voted for an incentives package that gave the company a six-year, 65 percent tax abatement, a $30,000 grant for permitting and development fees, and nominated it to be able to receive a $1.25 million refund in sales and uses taxes. He reportedly also worked overtime to try and get Tesla to move to the city, focusing, in the words of the Express-News, “on giveaways — a lot of giveaways.”
An admirer of Silicon Valley, Castro courted tech entrepreneurs and looked to “learn from Silicon Valley CEOs,” even as those same CEOs were pricing working-class families out of their homes a few states westward. He warmly welcomed Uber and Lyft’s 2014 entry into the city, even as San Antonio taxi companies filed a twenty-three-plainitiff suit charging the companies were in violation of a local vehicle-for-hire ordinance, and seeking a temporary restraining order and injunction stopping them from operating. When the city’s police chief issued the companies a cease-and-desist letter in response to the violation, Castro announced he was open to changing the ordinance.
It’s little wonder the business leaders who had once been suspicious of Castro were now fully on board with him. “We believe in your vision and we believe in your leadership,” the chairman of the Greater San Antonio Chamber of Commerce told him after a 2011 speech to local businesspeople.
Starving the beast
All the while, throughout Castro’s two and a half terms, the city continued to suffer from the tax freeze he’d backed and voted for before he was mayor.
By the time Castro won the mayoralty in May 2009, the city was in the midst of a major tax shortfall: revenue from the sales tax and hotel occupancy tax had both dropped, and, for the first time since 1993, so had the property tax base, as it would continue to do over his tenure. This coupled with the recession meant Castro’s first order of business as mayor was dealing with the first of a series of austerity budgets he had helped produce.
The city manager’s first budget in 2009 cut 334 jobs, froze wages, made across-the-board cuts to all programs, reduced hours for libraries, and cut back on services like lawn-mowing at city parks. Insulated from this pain were firefighters and police, who actually saw more personnel hired that year, the latter thanks to federal stimulus funds lobbied for by Castro. This was a regular feature: the 2010 budget would see $12 million in cuts and efficiencies balanced out with $13 million of new spending, some of which would go to yet more police and fire department staff. (Incidentally, the police and firefighters union had backed Castro early on.)
While $64 million over ten years was certainly a drop in the bucket, it started looking a lot bigger once the city government began nickel-and-diming its residents for every spare scrap of cash possible. City manager Sheryl Scully actually welcomed a 2009 summer heat wave that caused power plant shutdowns, because higher energy bills meant more money for the city, and successive budgets would continue to rely on higher energy use to make up budget shortfalls. Meanwhile, she ended events like the Houston Fair and Market and a Winter Wonderland, saving a measly $82,000 a year, while instituting $3.6 million worth of fee increases.
Castro and the council balked at raising property taxes. In fact, the 2009 budget cut them by less than 0.2 cents. When one council member suggested raising them in 2010 to avoid continued service cutbacks, Castro demurred. “I’m very comfortable leaving the property tax rate where it’s at,” he said. “We have made significant spending cuts over the last couple years and that has served us well during this budget year.” By the time he left office, property taxes in the city hadn’t gone up for more than twenty years, while their revenue intake shrunk year after year.
“Over the last six years, we’ve dropped our property tax rate three times and we’re the first big city to embrace the senior tax freeze in 2005-6,” he boasted in 2012.
But the city spent his mayoralty continuing to drain more and more from San Antonians through regressive means. With Castro and the rest of the council’s approval, public utilities raised rates, which were 80 percent of customers’ bills, year after year: 7.5 and 4.25 percent for electricity in 2010 and 2013, respectively, and 7.9 and 8.4 percent for water in 2011 and 2013, respectively.
“Nobody ever likes a rate increase,” said Castro. But, he explained, this was “a reasonable rate request that benefits the entire community” and the hike was “a necessary and prudent thing.” In 2013, with Castro’s backing, the San Antonio Water System (SAWS) hiked water rates yet again.
Castro and the council also had no issue proposing a hike to the sales tax to fund worthy projects, as they did in 2010 to fund protection of the Edwards Aquifer. He was sanguine about any public opposition to reauthorizing the sales tax hike, saying that voters would do it “if we remind them of the benefits.” Indeed, it later passed for the third time in ten years.
There were exceptions of course. When all but one of the SAWS board members suggested doubling a water supply impact fee on developers in 2014, Castro supported it, despite opposition from business leaders and developers who claimed it would halt all development. He ultimately supported a compromise, phasing in the much higher fee over the course of a year (though this fee ultimately tends to be passed on to ratepayers anyway).
But the sum total of Castro’s time in San Antonio saw him help gradually starve the city of funds, even as he lamented the rise of hunger in San Antonio and the city’s lack of investment in “human capital,” all while austerity at the state and federal levels further hit the municipal government. Meanwhile, more and more of the funding burden fell disproportionately on the city’s poor and working-class residents, while its older, wealthier, white residents disproportionately avoided paying.
The riverwalk and the rot
By 2014, Castro would be tapped by Obama to be secretary of Housing and Urban Development, and, with higher ambition calling, he would depart the city midway through his third term to take up the position.
Castro was seen as a perfect fit for the position given his role in San Antonio’s revitalization, viewed by some on the eve of his departure as his greatest legacy. Castro was a board member of Centro Partnership (also known as Centro San Antonio), a powerful public-private entity created by the city manager, staffed with city officials and business leaders, and tasked with steering this project and luring development to the city. Castro aimed to transform the previously un-exciting downtown area into a vibrant hub that would attract both tourists and residents, and keep young San Antonians from fleeing the city.
He helped see through his predecessor’s expansion of the San Antonio Riverwalk, presided over the building of thousands of new residential units, and led the approval of development projects in the both the city’s downtown and its most blighted areas, among other things. Castro pitched the city’s development to business leaders, developers, and bankers (“let’s make a deal”) and pushed for an incentive package that would waive impact fees for projects in San Antonio’s inner city.
But Castro also left office just as discontent with his vision began bubbling up.
The city government didn’t always live up to its promises of guaranteeing affordability. A 2012 report by the HUD’s Inspector General chided the city for failing to administer its federal housing grant in accordance with the program’s affordability requirements, when it doled out $1.8 million to third parties to renovate and resell fifteen residential properties. At nine of these fifteen, according to the report, the city either failed to make sure homebuyers knew about affordability provisions or didn’t make agreements that complied with them.
The report noted this wasn’t intentional — the city “was apparently unaware of the requirements.” Yet it hardly speaks of a government that viewed the issue as a priority.
Neither did a June 2014 luncheon hosted by Centro Partnership, which steered the development and on whose board Castro sat. Held to discuss locals’ concerns with creeping gentrification, the luncheon charged ninety dollars per ticket, which, as critics pointed out at the time, effectively locked out those most likely to be concerned about gentrification.
The problem festered. By 2014, the waitlist for the Section 8 program that gives vouchers to residents to bring down housing costs had grown to forty thousand families, a waiting period of around four to seven years — “the largest it’s been in memory,” the San Antonio Housing Authority’s spokesperson said at the time. Just last year, the city’s current council placed a six-month moratorium on a 2012 program that aimed to incentivize housing developments downtown because, in the current mayor’s words, “there have been some unhealthy consequences” from it, including “the subsidization of housing that the general public can’t afford.”
As the Express-News‘ Joshua Fletcher recently reported, that program gave $102 million worth of incentives to developers over five years, many of whom built high-end projects downtown that were out of reach for many of the city’s residents, and less than a quarter of which were for affordable housing. Housing costs have far outpaced incomes since 2010, while housing advocates charge that the city under Castro didn’t prioritize affordable housing.
Other damning indicators suggest the level of decline that rumbled beneath the glowing press releases. From 2012 to 2014 to today, San Antonio has held on to the dubious honor of being the most economically segregated city in the United States. In 2015, the year after Castro left, the city’s poverty rate stood at 19.8 percent, higher than the national rate of 13.5 percent and even Texas’ statewide average of 17.3 percent. It’s an issue that’s only exacerbated by the influx of more affluent residents to the city explicitly encouraged by Castro’s policies.
A twenty-five-city survey conducted by the United States Conference of Mayors in 2013 put things into further perspective. Of the twelve cities that estimated what percentage of demand for food assistance went unmet, San Antonio had the highest rate, at 40 percent. While the city had one of the lower rates for unmet need for shelter (10 percent), the report nevertheless noted that there was “a need for more affordable permanent housing” in the city, particularly for veterans, and that the number of homeless families and individuals had jumped by 11 percent over the previous year. (Meanwhile, in 2011, Castro had voted with the rest of the city council to toughen San Antonio’s already strict anti-panhandling ordinance).
Such woeful statistics are as much Castro’s legacy as San Antonio’s new downtown and frequently touted job numbers.
Regardless, by the time Castro left the San Antonio mayoralty for D.C., his tenure was considered a success. The mayor was sent off with glowing tributes from the local press, after being re-elected twice with sky-high margins. Those margins came via dismal voter turnout that only dropped lower the longer Castro was in power — from less than 12 percent in 2009, to 7 percent two years later and, finally, 6.9 percent in 2013.
Such disengagement perhaps speaks to the voting public’s disconnectedness from local politics. Or perhaps it speaks more to a popular rejection of a city hall that had long since ceased to look after the interests of most of those it was meant to represent.
In the footsteps of failure
If Castro is the “Latino Obama,” it’s because his career has followed remarkably similar beats as the former president: a likeable, ambitious young politician who plotted out a path to national power from a young age and sublimated his political goals to that overarching ambition.
In the process, rather than pursue a fundamental break from or transformation of the existing political consensus, Castro accommodated it, working in the interests of the wealthy and powerful. Meanwhile, his tinkering, while welcome when it came to programs like Pre-K 4 SA, was not enough to halt the accelerating decay in quality of life for a widening swath of people — a decay exacerbated by some of his own policies. Castro’s mayoralty was the Obama administration writ small.
It may be true that Castro was one man who could do only so much to resist the wider political atmosphere he was in, one hostile to most left-wing reform. Yet any Democrat who finds themselves in the White House in 2021 will be faced with not just a far more ruthless and hostile Right than this, but an oligarchic class united to prevent even moderate changes to the existing consensus. Castro’s quick accommodation to moneyed interests as mayor — and his failure to mobilize to his cause most of the city’s working people, who overwhelmingly didn’t see it worth their while to even vote for him in his three election wins — suggests how he might respond to such a challenge.
Castro could of course surprise the world once in office; no one would’ve expected Franklin Roosevelt to end up railing against “economic royalists,” either. But based on his record in power, don’t count on it.
This story first appeared at Jacobin.
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Branko Marcetic is a staff writer at Jacobin magazine and a 2019-2020 Leonard C. Goodman Institute for Investigative Reporting fellow. He hails from Auckland, New Zealand, where he received his Masters in American history, a fact that continues to puzzle everyone who meets him. You can follow him on Twitter at @BMarchetich.
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