From the Philadelphia Fed's description of its most recent Business Outlook Survey:

The survey’s broad indicators for activity, shipments, and new orders all declined sharply from last month. Firms indicated that employment and average work hours are lower this month....The survey’s broadest measure of manufacturing conditions, the diffusion index of current activity, decreased from a slightly positive reading of 3.2 in July to -30.7 in August. The index is now at its lowest level since March 2009.

Via Karl Smith, who comments: "There is just no good way to look at this." We're nearly in the same territory we were in during the worst part of the Great Recession.

Is the media correct to mostly ignore Ron Paul? I say yes, and Will Wilkinson notes that several other folks agree:

They speak with one voice: Mr Paul is a marginal candidate with a proven base of highly-motivated supporters who turn out in droves for mock-electoral trifles, but he lacks the the broader base of support necessary to qualify as a contender worth covering.

Though I think there's something to this line of thought, I also think there's something insidiously circular about it. Perhaps the best way to grasp this complaint is to compare Mr Paul's coverage to Ms Bachmann's. Both serve in the House of Representatives, though Mr Paul's record of service is decades longer. Both are significant figures within the populist tea-party movement. Real Clear Politics's average of recent national polls puts Ms Bachmann and Mr Paul at 9.6% and 8.8% of the Republican vote, respectively. Of course, poll results aren't independent of press coverage. Ms Bachmann, for reasons known only to the gods, has been lavished with media attention, even before dipping a toe in the presidential water. Yet she remains at least as unviable a candidate as Mr Paul is said to be.

But Will — along with Jon Stewart and all the others who think the media is being unfair toward Ron Paul — is missing the single biggest difference between Paul and Bachmann: Paul has already run before. We don't have to guess about Ron Paul's appeal: we know exactly what it is, where it comes from, and how big it is. What's more, we also know whether it's changed since 2008, and unless I'm missing something, it hasn't. At all. He's basically got the same group of fervent followers he's always had, and nothing more.

It's not unusual for someone who ran and came close to run again (cf. Ronald Reagan, John McCain, Mitt Romney). But if you run a very distant fourth, winning no states and collecting 1.6% of the delegates, you really need to have a compelling story if you decide to run again. Ron Paul doesn't, and everyone knows it. Like it or not, he's a novelty candidate and he's had his 15 minutes. It's time to move on.

In my summary post yesterday about Texas job growth, I mentioned that one big factor in Texas's relative economic success during the recession was its strictly regulated housing market. Texas has long had strong mortgage regulations, and these regulations restricted the growth of both home mortgages as well as home equity loans during the go-go years of the aughts. As a result, Texas didn't have much of a housing bubble and Texans, as a whole, didn't go very deeply into debt.

But how big a role did this play? Debt overhang is a big factor in our protracted economic downturn: when overleveraged consumers cut back on spending, this reduces demand for goods and services and gives businesses no reason to expand production. So economic growth stagnates and unemployment stays high. Today, Mike Konczal updates his look at deleveraging across the country, and the chart below quantifies this story of deleveraging and unemployment. Texas didn't have a housing boom thanks to its strict mortgage regulation, its debt overhang has therefore stayed low, and its unemployment rate, far from being exceptional, is right where you'd expect it to be.

This isn't the whole Texas story, but it's a big part of it. The 2008 financial collapse was primarily a story of a housing bubble caused by mortgage lenders run amok, and Texas mostly avoided that. This means it's also avoided the worst of the unemployment crisis. No miracle. Just common sense financial regulation. Mike has more details at the link.

What's ironic about this is that most of the things that have helped Texas during the recession aren't really exportable to the rest of the country. Not every state can be in the Sun Belt, not every state can have lots of open land and low housing prices, not every state can have a thriving energy sector, and a regulatory race to the bottom doesn't do the country as a whole any good. But one thing that is exportable is tighter government regulation of the mortgage market. It works! Even though Texas is a fast-growing, warm-weather state, it avoided most of the housing madness. But that's the one thing you'll probably never hear from Rick Perry. Too bad.

Hating on the EPA

I've been watching over the past few months as the EPA has slowly but surely turned into one of this year's major right-wing demons, culminating in Michele Bachmann's suggestion that we should get rid of the entire agency, lock stock and barrel. But environmental protection has always polled pretty well in the abstract, which leads Steve Benen to say:

The very existence of the EPA has never been a partisan issue until now — Nixon created the agency four decades ago — and my fear is Republican activists will loathe the office simply because their national candidates tell them to.

I'm pretty sure this is wrong. Sure, Bachmann is (surprise!) more extreme than most, but the EPA has been #1 with a bullet on the corporate hate hit parade for a very long time. Also #1 (or close) on the list of agencies loathed by farmers and ranchers and other rugged individualists who vote Republican.1 And it's not hard to understand why: the EPA really does issue lots of regulations that really do prevent corporations and landowners from doing whatever they want with their land. And even if most of those regulations are pretty defensible, in a country our size there are always bound to be plenty of example of rules that are hard to understand, affect lots of people they weren't really aimed at in the first place, and seem to cause way more frustration than they're worth. That makes EPA a pretty inviting target.

If we lived in a different universe, I think my response to this would be: Yes, we should take a broad look at EPA rules, figure out where the barnacles are, and try to streamline them in ways that make sense. Unfortunately, in the real world we live in, this wouldn't prompt any kind of similarly moderate response from Republicans. They're ginning up their base to view EPA as history's worst monster, a bureaucratic octopus that's strangling the life out of our economy, and that's that. They have no interest in some kind of serious policy discussion of environmental rules, and any attempt to engage on that level merely gives them an opening for further demagoguery.

What to do about this? I don't know. For now, though, it unfortunately means just fighting back and not worrying about nuance. What other options are there?

1OK, fine. Maybe corporations actually hate OSHA more than EPA. And maybe farmers hate the Interior Dept. more. But EPA is pretty close to the top any way you cut it.

I know this is of keen interest to everyone, so here's the scoop on President Obama's August vacation at Martha's Vineyard:

How does the number of vacation days the president has spent compare to his predecessors? CBS Radio's Mark Knoller has kept track of presidential vacations for years and supplied the data.

So far, President Obama has taken 61 vacation days after 31 months in office. At this point in their presidencies, George W. Bush had spent 180 days at his ranch where his staff often joined him for meetings. And Ronald Reagan had taken 112 vacation days at his ranch. Among recent presidents, Bill Clinton took the least time off — 28 days.

Does this mean we can knock off our idiotic annual whining about Obama's vacations? No? I guess I didn't think so. Carry on then. And don't forget to complain about how elitist Martha's Vineyard is compared to a multi-million-dollar ranch that was purpose built to be a presidential backdrop. It wouldn't be the same without that.

Seriously? Republicans are continuing to pine for another white knight? Rick Perry has only been in the race for five days, but his run of flaky off-the-cuff remarks already has the rumor mills rekindling over Paul Ryan and Chris Christie. (Though not for Rudy Giuliani, if you can believe that.) Come on, folks. If you can't win with any of the folks already running, you can't win.

A special ed girl in a Missouri middle school reported that she was raped a couple of years ago. But school officials insisted that her story was made up and badgered her into recanting:

Following instructions from the school, the girl wrote an apology to the boy she accused of raping her and had to personally give it to him, according to the lawsuit. She was then expelled for the remainder of the 2008-09 school year....The girl returned to the middle school for the 2009-10 school year and tried to avoid the boy, according to the lawsuit. It didn't work. She was sexually assaulted again [in the school library] but didn't tell anyone because she was afraid of being expelled again.

....School officials were notified of the incident and allegedly doubted the girl's claim, saying they'd "already been through this," according to the lawsuit. The girl was also examined and found to have been sexually assaulted. However, she was suspended from school for "disrespectful conduct" and "public display of affection," her lawyers wrote in the lawsuit.

I'll grant that it's impossible to know for sure what happened based on just one side of the story. Still, a forensic exam after the second rape showed that the girl had indeed been sexually assaulted, a DNA match was made to the boy she had accused of raping her, and the boy then pleaded guilty to charges in juvenile court. But the school district continues to say that it bears no responsibility for any of this. WTF?

You know how conservatives don't really care much about the deficit when a Republican is president, but it becomes something close to Armageddon-in-waiting whenever a Democrat is in the White House? Yesterday Matt Yglesias pointed out that the same thing is true about conservative reaction to the value of the dollar: when it plummets for years at a time under Republicans, they don't care. But when it so much as wobbles slightly for a few months under a Democrat, suddenly it's a sign that we've lost our moral backbone and our place as leaders of the free world. This is illustrated in text form here and in handy chart form below. For some reason I felt the urge to redraw Matt's version, but you can see the original here if you like.

From Will Wilkinson, who scored a front-row Iowa diner seat to an encounter between Rick Perry and a libertarian critic who thinks he's just another big-spendin' liberal:

I enjoyed witnessing this fleeting, close-up moment of flesh-pressing campaign politicking. Mr Perry's skillful exit from the exchange, his calmly assertive demeanour (note the way his initially attentive eyes narrow into a challenging "kiss off" grin, the way he presses his index finger softly into Mr Hjelm's chest) and the folksy leavening of his denigrating parting shot, all suggest to me a seriously skilled retail politician whose swagger remains mostly charming even when he's being an impatient prick.

Video at the link. Wilkinson also points out that Sarah Palin has taken up this particular line of attack, retweeting the chart on the right that takes direct aim at Perry's debt-loving ways. Did she call attention to this because it makes her look good or because it makes Perry look bad? With Palin, it's hard to say. But luckily for her, it does both.

Rick Perry, the Republican governor of Texas, is running for president.

So what's the real skinny on the "Texas Miracle"? Without diving into every last detail (I'll provide some links for that), here are the main bullet points:

I think it's obvious that there are lots of openings to criticize both Texas' economic performance and Rick Perry's role in it. For one thing, the Texas virtues that Perry likes to emphasize are actually common to lots of low-tax, low-service states in the Sun Belt and the South. As Ed Kilgore says, "Eventually, someone will draw attention to the fact that if Perry’s low-tax, low-services, corporate-subsidizing policies really were an economic cure-all, similar conditions should have made states like Alabama and Mississippi world-beating dynamos years ago." This is going to make it hard for Perry to make a convincing case that taxes and regulation and general business friendliness are really behind his state's performance. What's more, there are lots of obvious chinks in the Texas armor: its poor rate of health care coverage, its high poverty rate, its weak educational system, and so forth.

And yet…jobs! It's still the case that Texas has created lots and lots of jobs and has attracted a huge influx of new residents thanks to those jobs. No one's putting a gun to their heads and forcing them to move to Houston, after all. No matter how many hits Perry takes over his simplistic explanations, and no matter how many sophisticated arguments his opponents make about the emperor's lack of clothes, it's still the case that Texas has created lots of jobs. All Perry has to do is repeat that until his face turns red while tossing out some folksy mockery of the eggheads and bureaucrats and their ivory-tower Harvard counterarguments. After all, who are you going to believe, all those East Coast twerps who have never run a company in their lives, or your own eyes?

This is going to be a tough row to hoe for Perry's detractors. It's worth going after it, but in the end, Texas' record on jobs is good enough and real enough that Perry will probably be able to brush off most of the criticism. The Texas Miracle is going to be one of his strongest calling cards.

His weakness for Texas-style crony capitalism, however, might be a real problem. I suspect we're going to be hearing a lot more about that as the oppo teams start to seriously gear up.