I OFTEN WONDER if the leaders of Rhode Island’s public-employee unions and poverty industry believe what they are writing. They cannot be that woefully ignorant of basic economics and the grim realities unfolding right outside their door, can they?

Apparently, they can.

Either that, or they want Rhode Island to spiral into economic disaster. Presumably, growing numbers of poor people and declining numbers of wealth creators would enhance their power in some way.

How else to explain the economic blinders donned by Kay Brewster, executive director of The Poverty Institute, in her May 30 Commentary piece “Raise revenue to cut R.I. deficit”?

Ms. Brewster advances the classic Rhode Island solution to our raging budget deficits: Soak the citizens even more by hiking “taxes, fees and other income.” After all, it’s an “investment” in Rhode Island.

This game might go on forever if people would just sit still and take it. But, as common sense should suggest, human beings are motivated by self-interest. Torture them too much, downsize their families’ future too egregiously, and they will pick up and leave. There are other places they can live — places just a few miles away.

We seem to be at that tipping point. Rhode Island no longer can generate the tax revenues needed to support its obese government. Its percentage of well-to-do people — who are important to keep around, because they pay way more than their share in taxes — is lower than that of other states. And those who have remained, out of love for the people and places of this wonderful state, are poised to leave reluctantly.

Ken Block, of Simpatico Software, writes in a letter to the editor (which he gave me permission to quote): “I own a small business with eight employees,” all earning salaries that greatly exceed the per-capita income. “My accountant calculated that if my business were located in Massachusetts as opposed to Rhode Island, I could personally save tens of thousands of dollars on my tax bill. This could be achieved simply by moving my offices 10 miles up the road!”

The advocates of ever-higher taxes say the well-off can afford to suck it up and fork over the loot. But if Rhode Island tilts the deck that much against them, who in their right mind is going to do so?

Mr. Block, who cares enough about the Ocean State to wish to stay here — and who, as the owner of a start-up high-tech company, is the kind of person most sane states would desperately want inside their borders — is speaking for many when he lays it on the line: “Any additional tax burden beyond that which I am paying would necessitate moving my business to a more accommodating tax climate. Those who advocate for higher taxes to pay for aid programs should realize that additional tax increases could lead to a much more drastic reduction in aid programs as the tax base flees.”

He adds, “Imagine running to Massachusetts for tax relief!”

The economics should be clear, even to the most rigid ideologues. If you want money to pay for all those public-employee pensions and to help provide crucial services for the poor, you need a tax base. If you want jobs and an economic future for your children — in short, if you want prosperity — you need to have entrepreneurs willing to invest in your state.

High taxes are one of the factors that drive capital to other places. People don’t want to invest where they won’t get a return. Because Rhode Island is so small, it is even easier to pick up and leave.

The numbers spell out very clearly what is happening. State and local taxes are rising at a significantly faster clip than income. In 1970, according to the Tax Foundation, state and local taxes as a percentage of income were below the national average. We ranked 31st in the country in tax burden. Today, we rank fourth. And the government’s take of what we earn has outpaced our income growth for the last six straight years.

Those who say that’s not enough of an “investment” are living in fantasyland.

Rhode Island already is grappling with total deficits for the remainder of this fiscal year and next of well over $400 million. This is getting serious. A fiscal meltdown of historic proportions now confronts the state. Its leaders must somehow muster the courage to reinvent the government and make its tax structure competitive.

But it’s difficult to see how the legislature, utterly dominated by one party and beholden to powerful special interests, can enact that kind of structural change in the pell-mell rush of writing a budget. Such reform, sure to elicit howls of outrage and political retaliation, requires a leader who can come forward and rally the public behind it. Unfortunately, Governor Carcieri seems to be missing in action, while the public is in its usual haze, rushing off to work, coming home at night, and simply hoping that the General Assembly doesn’t whack them too hard this time.

There is one thing everyone should remember: Whatever opinions are offered on these pages, the laws of economics will keep on functioning. However the advocates wish people would behave, humans will keep on responding to incentives. If the politicians persist in hiking taxes, they will keep on driving out wealth creators and pumping up deficits. Just you watch.

Edward Achorn is The Journal’s deputy editorial-pages editor ( eachorn@projo.com).