Brad Plumer takes a closer look at the “Texas miracle”:

Texas, economists note, has long been a low-tax, loose-regulation state, but it hasn’t always thrived — between 2008 and 2010, after the U.S. economy collapsed, the state’s unemployment rose faster than in high-tax Massachusetts. In May, Texas’s unemployment rate, at 8 percent, ranked twenty-fourth in the country, slightly worse than liberal New York’s. What’s more, not all of those vaunted jobs are great jobs: Texas has the highest percentage of minimum-wage workers in the country, and its per-capita income still sits below California’s.

What is clear is that Texas’s population has been exploding, leading to disproportionate job growth. In the past decade, the state added more people than anywhere else, partly due to fast-growing Hispanic families, but due also to migration from other states. So why are people flocking to Texas? It could be the state’s lower taxes, though that probably isn’t a big driver: As Brad DeLong of University of California, Berkeley, has noted, Texans pay, on average, 26 percent of their income in taxes, not much lower than the 28.5 percent average in California.

More likely, people are moving to Texas because housing is so affordable. In a 2006 survey by the Census Bureau, Texas ranked forty-second in the cost of housing. Conservatives can take some credit—by and large, it’s easier to build houses in Texas’s biggest cities, with fewer land-use and zoning hassles, according to Harvard economist Edward Glaeser.

But conservatives shouldn’t be too triumphal. Texas didn’t suffer from a ruinous housing bubble like nearby Arizona and Nevada, thanks to regulations that limited debt on homes and restricted “cash-out” refinancing (a common practice in states like Florida and California, in which people got free cash for refinancing their homes). As a result, Texas didn’t fare as badly when the housing market cratered this time: Only 6 percent of Texas borrowers were in or near foreclosure, versus a national average of nearly 10 percent. Two cheers for intrusive regulations.

Other aspects of Texas’s success come down to sheer luck. The state is home to large oil and gas reserves. As oil prices have climbed over the past decade, new rigs have sprouted up like toadstools, while the natural-gas craze has led to economic booms in North Texas and the Eagle Ford Shale near San Antonio. The Dallas Fed has found that, every time oil prices rise 10 percent, Texas gets a 0.5 percent GDP bump. That’s hardly something other states can replicate.

Then there’s the uglier side of Perry’s rule. The state is looking at a staggering $27 billion deficit for 2012-2013. Perry managed to paper over Texas’s last budget shortfall by taking $6.4 billion in Obama stimulus money, more than all but two governors. (At the same time, he was suggesting Texas should secede from the union.) Now, without Democrats in Congress to bail him out, Perry and other Republicans in Austin are proposing big cuts to Medicaid and education — this in a state where 26 percent of people are uninsured, the highest percentage in the United States.

That’s a rather different picture than Texas governor — and possible 2012 contender — Rick Perry is painting in his campaign speeches, of course.