Dalton, Ga., is known as "Carpet Capital of the World," home to 150-plus mills, plants, and 100 carpet outlet stores, and is the birthplace of Marla Maples.

Mohawk and Shaw Industries are among the biggest names in floor covering with headquarters operations there. When times are right, the industry employs about 30,000 people in Whitfield and Murray counties in Georgia.

But times aren't right. In the latest Bureau of Labor Statistics unemployment data for metro areas released last week, Dalton stands out ... in a bad way.

In the 12 months since July 2008, Dalton's rising tide of unemployed swelled by 3,500 workers. That's not where its real point of distinction lies, however.  It is its percentage unemployed that is an eye-catching 13.2%, which is well above the state of Georgia's 10.4%, which itself is higher than the national average of 9.7% unemployment. 

In January, Dalton's The Daily Citizen reported:

North Georgia is reeling from the slumping floor covering industry. The housing market, which has slowed significantly in both new construction and existing sales, has also hurt floor covering sales. Although the cost of oil has dropped recently, high raw material costs are affecting companies. Those combined factors have led to job losses and cuts in workers’ hours.

Some estimate that for every new home built, it takes 276 jobs in businesses ranging from carpets and carpenters to copper manufacturing and tree nursery workers. Too, word is that for every dollar spent on direct costs of a new home, an additional $7 go into the economy on consumer and commercial spending. The BLS notes that the economy has shed 7.4 million jobs since the start of the recession--1.4 million of them in "construction," many more of them in "construction-related" manufacturing and services.

In early September--as members of both houses of  Congress returned from a late-summer recess to address some of the most profoundly transformative policy issues the nation has faced since the period of Reconstruction following the War Between the States--Republican Sen. Johnny Isakson put it even more bluntly than the Dalton Daily Citizen.

"The carpet mills are basically shut down," says Isakson as he calls to mind a lurid example of the collateral damage perpetrated by a housing crisis that's rounding the bend into its third painful year.

"No other industry has so many businesses built on top of it as housing does," says the 64-year-old freshman senator, who was for decades prior a residential real estate maven in the Atlanta area.  Isakson since early spring 2008 has doggedly pursued legislation that would extend buyers of all incomes a $15,000 tax credit on the purchase of any primary residence, a program that would run 12 months from its start. "We're 20-some months into the worst housing economy we've had in our lifetimes," says the senator. "That's how long I've been working on this legislation, and I just don't think we're going to come out of the broader downturn without housing getting fixed."

• See this story from Big Builder editor Sarah Yaussi on calculating the cost of extending the current $8,000 first-time home buyer tax credit into 2010.
• See this note on the multitude of tax credit measures under consideration in Congress.

His most recent play came in July, as Congress put its finishing touches on the Cash for Clunkers new car stimulus program.

"We reintroduced the bill as an amendment to the CARS legislation, and it won support from both the Senate Banking Committee chairman Christopher Dodd (D-Conn.) and the chairman of the Budget Committee Kent Conrad (D-N.D.), and that was an achievement," says Isakson. The amendment, however, didn't get enough support to go with the clunkers program, so it's back to the political grind, operating face-to-face with his colleagues throughout Capitol Hill out of his first-floor digs in the Russell Building there.

"They know when they see me on the second floor what I'm coming to talk to them about," he says unabashedly. "This issue links to all of the economic and social issues on our agenda right now."

He says he's going to keep at the legislative pursuit for as long as it takes. He imagines plenty of opportunities between now and the end of the year to get the bill included as an amendment to other taxation, budget, or finance legislation.

"Ideally, we'd love to see the bill come out of committee and win support by itself. The last thing we need right now is for Nov. 30 to come and go, and then you slip in to the slowest period of the year for real estate in the months of December, January, and February. Without the catalyst of the tax credit, I'm afraid to imagine how bad things could get."

Nevertheless, with the $8,000 credit that came into effect this year with the passage of the almost $800 billion stimulus package, he contends that the measure got it only part way right.

"The $8,000 program has proven that a stimulus will work to get home buyers off the sidelines and into the market, but what I've been saying all along is, we don't have a first-time buyer housing recession, we have a move-up buyer recession. It's those people who can't sell their current home in this environment and move into more of the home of their dreams that have unfortunately caused such a slowdown in the entire economy."

Isakson knows whereof he speaks. Selling homes is in his DNA. He's the grandson of Swedish immigrant Andrew Isakson who by trade was a stone-mason and plumber, and who went into home building when he arrived on this side of the pond. Senator Isakson's father, Ed, went into the real estate business as well, selling homes and commercial properties after first having spent time as a butcher.

In 1967, Isakson himself joined his father's Northside Realty company. A consummate salesman's personality blended with basic business instinct, Isakson became president of the company at 33.

Before he did that, though, came the deep recession of 1974, which featured a 36-month supply of homes for sale. Congress legislated a $2,000 credit for home buyers, and the effect was legendary. Many, including Isakson, believe that jolt to housing went far toward lifting the entire economy out of recession.

"He's run a business, made a payroll, paid health benefits for his employees, been there and done that," says John Wieland, a longtime friend of the senator. "I can guess that the first time we met, it was probably about a commission that he didn't get on the sale of one of our houses. Still, from the minute you meet Johnny, you get the feeling that 'this is your kind of guy.' He's very approachable."

Isakson, like 35 other senators and 435 members of the House of Representatives, have a lot on their minds these days as they confront the issues of a continued challenge on the jobs and economics front, as well as health care reform, a transformative cap and trade energy bill, and financial services reform. Many of them can't help but think of one thing in the back of their minds as they consider their positions on each of these huge issues: re-election.

Senate Majority leader Harry Reid (D-Nev.), who hails from another state decimated by housing's convulsive trajectory, is also up for a difficult bid to reclaim his seat if things don't improve on the jobs and real estate front. Through a spokesperson, Reid says, "We believe we can extend the current credit for first-time home buyers, and we need to do it by the end of the year."

Although Isakson may not encounter serious opposition in his bid for a second term in the Senate, Wieland thinks it would send the right message for home builders, manufacturers, and real estate people to show financial support for Capitol Hill's patron saint of home builders.

Wherever each stands philosophically on free trade vs. government stimulus policy, every one of them will have to account for his or her constituency's jobs picture by the time Nov. 2, 2010, rolls around. Like as not, re-election and action on behalf of getting the economy rolling toward job creation are going to have more correlation than meets the eye.