High local and state taxes have battered Rhode Island businesses, driving out jobs and thus crimping tax revenues. With fuel and food prices going through the roof, and jobs disappearing at an alarming rate, politicians seem to be getting the point that hiking taxes in this election year might not be such a good idea after all. Public-employee unions, meanwhile, are unhappy.

The General Assembly voted overwhelmingly to close a $168 million estimated deficit in this year’s bloated state budget by trimming spending rather than raising taxes. It mostly went along with the recommendations of Governor Carcieri. House Speaker William Murphy and Finance Committee Chairman Steven Costantino were the key leaders in holding the line.

Rhode Island has gotten into this mess by overspending for years at a rate that greatly outstripped the growth in taxpayers’ incomes. Much of this was due to swelling social programs and to pay for state workers’ extravagant pensions (often taken at astonishingly early ages), health-insurance plans and other golden benefits unavailable to almost everyone else in the state except local public employees.

We blame not the unions, which, like companies, seek to maximize profit, but state officials who, over the years, have given away the store to avoid confrontation, or out of incompetence or to curry political-campaign support from the well-heeled, well-staffed unions.

The Senate Finance Committee almost derailed the effort to curb the overspending. Voting against a return to reason were Senators Frank Ciccone, Hanna Gallo, Beatrice Lanzi, Paul Moura, Juan Pichardo and Dominick Ruggerio.

Senators Ciccone, Moura and Ruggerio all work directly for organized labor, and Senator Lanzi is the director of “labor community services” for the United Way of Rhode Island. Fortunately, Senate President Joseph Montalbano and Majority Leader Teresa Paiva Weed came to the rescue and kept the budget from being derailed, defeating legislators who put their personal interests ahead of those of the mass of their constituents.

Still, some caveats:

• This was only to close the deficit for the current fiscal year, which ends June 30. Much bigger deficits have opened up for next year’s budget and beyond, probably requiring much deeper cuts.

• The deficit numbers are based on November estimates. Since then, the economy has performed worse, which raises the prospect that the actual current-year budget deficit will be higher.

• This is all being done in a rather haphazard manner. What Rhode Island needs to do, in the long run, is reinvent its government from the ground up: Decide what it can afford to do, and do that well. It may not be able to afford every social program it wants, for example, or to reward public-employee unions for their support for certain politicians as lavishly as in the past. It might want to spend more money on safe roads and bridges, for example, and less on programs that most people do not consider basics of government.

It also must find ways to consolidate government services in a tiny place with far too many layers of government, local and state. We shouldn’t forget that the biggest hit is not statewide taxes but local property taxes, which are so high in part because of sweetheart local public-employee contracts but also simply because there are too many jurisdictions for such a tiny state.