New York has a new budget:

After reaching an agreement late Tuesday with Gov. David A. Paterson on the last unresolved pieces of the state budget, the Legislature passed the bills on Wednesday that will complete New York’s $122 billion spending plan for the next year.

The new budget, which relies on an array of taxes and fees for smokers, banks, hair salon patrons and others to keep the state’s 200,000-person government running, comes as New York faces one of the most uncertain economic outlooks in recent years.

Among the taxes and fees New Yorkers will have to pay are a $1.25 increase in the state cigarette tax. The new budget also closes a loophole in the state’s tax law that allowed online retailers like Amazon.com to avoid charging New York State sales tax on purchases.

A plan to raise income taxes on New Yorkers who earn more than $1 million a year was not included.

Meanwhile:

Millions of dollars worth of counterfeit tax stamps were seized and a Jordanian man arrested as part of a major undercover investigation into tobacco smuggling in New York, authorities announced Wednesday.

The arrest comes as some authorities voice concern about whether New York state’s planned $1.25-per-pack hike in tobacco taxes, taking the price of a pack in the city to about $9, will fuel demand for contraband cigarettes.

Health surveys have found that more than a third of New York state smokers already regularly buy cigarettes from untaxed sources.

State Department of Taxation and Finance Commissioner Robert L. Megna said his agency has stepped up its campaign against contraband cigarette trafficking over the past year.

Stupid is as stupid does.

In the Shreve High football stadium,

I think of Polacks nursing long beers in Tiltonsville,

And gray faces of Negroes in the blast furnace at Benwood,

And the ruptured night watchman of Wheeling Steel,

Dreaming of heroes.

All the proud fathers are ashamed to go home.

Their women cluck like starved pullets,

Dying for love.

Therefore,

Their sons grow suicidally beautiful

At the beginning of October,

And gallop terribly against each other’s bodies.

James Wright, Autumn Begins in Martins Ferry, Ohio

In celebration of the renewal for a third season of Friday Night Lights, one of the best shows about many things, but particularly rural poverty, to grace television screens in America.

Comments from the New York Times City Room blog, regarding the shooting of Sean Bell by undercover officers:

Of course the police will say that they identified themselves. However, no other witnesses at the scene heard them say anything about being police. They’re not exactly disinterested in their testimony.

– Posted by Shel

If the victims who where shot where innocent, Why did they run from the cops? Everything is always racially driven, a white cop shots a black person and Al Sharpton sets charge, What about the White Male who was killed in LONG ISLAND by a Black Male 2 months ago? WHERE THE HELL WAS AL SHARPTON FOR THE WHITE PEOPLE?

– Posted by John

Having served on NYC grand juries several times, I have heard extensive testimony about under cover operations by very brave NYC cops. Almost always the testimony involved serious drug dealing and illegal hand guns being found. The cops’ lives were almost always in danger in these situations. I never saw evidence that the cops acted recklessly.

Without under-cover stake-outs, many more crimes would be committed, and people of all races and economic settings would be in much greater danger from thugs.

The police in places like the Altima operation must actually witness felony crimes taking place or have reasonable grounds to suspect the threat of felony crimes to arrest possible perpetrators. They also must have reasonable grounds for seach and arrest.

They can’t just walk up to suspects and say, “We’re the police. Are you about to commit a felony? If so we wish to search you please.”

This particular situation ended up in a tragedy. Not a racially motivated tragedy. Just a tragedy. But most under-cover cops are brave, sensible, and dedicated, not reckless hot heads.

Trying to ram someone’s car when drunk, whether a police vehicle or a private citizens, certainly helped increase the odds of a tragedy occurring.

In the Altima case: Tragady yes, but clearly not a crime.

People who worry obsessively about police brutality should volunteer to serve on narcotics grand juries in NYC. It’s a real eye opener.

– Posted by realist

I have been struck by a member of the NYPD. My (then

pregnant) wife was threatened by a uniformed officer. We are both white. We do not live in NY. I requested an officer to take the tape [!] from his badge so I could report his number and was told to get “the **** away” or he’d introduce me to his stick.

I do not believe anything a member of the NYPD says.

– Posted by netpedant

When black males collectively start acting like responsible members of society, tragic incidents like the Bell case will go way down. The high incarceration rate of black men, and the widespread assumption that young urban men of color are carrying firearms,is not the fault of cops or Caucasians.

– Posted by James

I firmly believe that there were events that night that warranted police intervention, not for anyone to lose their lives, but when that vehicle charged at the police, it no longer matters if they had a gun or not, they were attempting to run from the cops for some reason, the friends of sean bell, including sean bell, do not have clean police records, they are not generally law abiding citizens, this whole case is very sad, good luck to the jury.

– Posted by Kim

If I am not mistaken at least one of the “victims” had a prior record and this group was “celebrating” the upcomin marriage of one of its members at a sleazy strip club known to be a drug den. You would have to gve the police at least the benefit of doubt under those circumstances.

– Posted by Whatsreallyup

A few years ago, I was put on a Manhattan Criminal Court jury. A man had entered a Midtown 5th Avenue store and stolen a 5? tall glass statue being sold for $ 28,500. It was winter and he tried to hide it under his parka, but it poked out of both the top and bottom. When he ran out of the store, he ran into two patrolmen knocking one to the ground and destroying the statue. He then ran across 5th Avenue and into the side of a taxi. He was immediately arrested by the two policemen. This was at lunchtime on a sunny day so there were hundreds of witnesses.

I say he was guilty, because not only were there hundreds of witnesses but it was all captured on video. Which we saw. Yet we only found him guilty of a lesser charge that sent him to Rikers for 15 days. It was only because we deliberated for two days that he got anything.

The reason for the lesser charge? More than half of the jury were minority and they all felt he was just a patsy. He was also a minority and they believed he was part of an insurance scam by the store and may not even have know he was stealing. They didn’t think he should get any time because the store management organized the crime. They felt he may have been just asked to move the sculpture. They couldn’t believe a minority could enter this store without being immediately surrounded by staff unless it was part of a plan. They also believed the police knew of the plan and were waiting for him.

He did not testify nor did his lawyer mention these possibilities.

It was a very frustrating experience for me. I don’t think we reached the right conclusions. Yet the majority of the jury reached their similar conclusions without ever having met each other beforehand. Their experience with authority and the legal process was clearly far different than mine.

I hope this much more serious case is decided using the law, the facts, and common sense. Whatever the result is, I hope they’re right.

– Posted by Bruce

Sean Bell: arrested 3 times (including once for firearm posession).

Joseph Guzman: arrested 9 times (including once for firearm posession). Spent 5 yrs in prison.

Trent Benefield: arrested 3 times (including once for firearm posession).

I’m sorry this young man is dead, but why such outcry over 3 dangerous law-breakers. Other than companionship to their friends and (presumably) love to their families, what contributions do/did any of these individuals make to society?

Lets get mad when the police mistakenly kill a real achiever, a real contributor… because that happens so often.

No one supports police brutality, but these three were zeros. This circus is just such a waste.

– Posted by surrr

This is America’s most cosmopolitan city, of course.

It is manifestly clear and has been proven in practice and by the facts of all revolutions that a struggle for ideals, for improvements of any kind whatsoever, absolutely must be supplemented with a struggle against some social class or caste.

My object is to create first-rate revolutionary upheavals, regardless of what methods and means I have to use in the process. Earlier revolutions were directed either against the peasants, or the nobility and the clergy, or against dynasties and their network of vassals, but in no case has revolution succeeded without the presence of a lightning rod that could conduct and channel the odium of the general masses.

With this very thing in mind I scanned the revolutionary events of history and put the question to myself against which racial element in Germany can I unleash my propaganda of hate with the greatest prospects of success? I had to find the right kind of victim, and especially one against whom the struggle would make sense, materially speaking. I can assure you that I examined every possible and thinkable solution to this problem, and, weighing every imaginable factor, I came to the conclusion that a campaign against the Jews would be as popular as it would be successful.

There are few Germans who have not been vexed with the behavior of Jews or else have not suffered losses through them in some way or other. Disproportionately to their small number they account for an immense share of the German national wealth, which can just as easily be put to profitable use for the state and the general public as could the holdings of the monasteries, bishops, and nobility.

Once the hatred and the battle against the Jews have been really stirred up, their resistance will necessarily crumble in the shortest possible time. They are totally defenseless, and no one will stand up to protect them.

~Adolf Hitler, as interviewed by Major Josef Hell

(Via Bryan Caplan)

I still haven’t managed to get my jaw off the floor after reading that.  The implications stagger me.

I won’t pretend that I understand quantum physics, or quite understand what the actual issues regarding CERN’s new Large Hadron Collider are, but the final paragraph of an article about it in the New York Times gives one of the greatest article closers I’ve ever seen:

Dr. Arkani-Hamed said concerning worries about the death of the Earth or universe, “Neither has any merit.” He pointed out that because of the dice-throwing nature of quantum physics, there was some probability of almost anything happening. There is some minuscule probability, he said, “the Large Hadron Collider might make dragons that might eat us up.”

OK, so here’s the thing: everything I’ve read of Naomi Klein’s, and everything I’ve read about “The Shock Doctrine”, has me convinced that it is crap.  But people who I know and consider quite smart such as Turkana and Meteor Blades think it is the best political book in ages.

So, anyone want to tell me what is so great about it?  I’ve seen it panned in great detail, but nothing but the most vague explanations of how awesome it is supposed to be.

No one can force us to give up that culture-even the suicide bombers. There is a very clear polarization taking place…on one side those striving for peace, nonviolence, and a future of cooperation with the international community, and on the other those who stand for confrontation and hatred. They are men of violence, but we refuse to be cowed. We may lose, but we will make a stand.

Asfandyar Wali Khan, grandson of Ghaffar Khan, Muslim follower of Mahatma Ghandi.

So, after yet another rate cut by the Federal Reserve, along with better than expected earnings from Lehman Brothers today (who many feared would follow the path of Bear Stearns), the Dow rocketed up over 400 points.  Economy solved, right?

Nope.  Doesn’t mean anything.  Don’t let anyone fool you into thinking it does.

First of all, the market in equities is now a mere fraction of the size of the market in derivatives.  The assets which are toxic right now are derivatives; Collectivized Debt Obligations and Credit Default Swaps primarily.  The big problem is that everyone knows these derivatives are worth less than they thought, but no one is sure just how much less.  So, no one wants to buy them, out of the fear that the bottom is a long way off.  Compared to these assets, stocks are incredibly stable – the market should do alright, even as these assets get worse.

But second, stock prices increasing doesn’t by default mean what you might think.  For a neat example, Bear Stearns makes for a fascinating example.

The Fed-brokered JP Morgan bailout of Bear is at a share price of $2 a share, as most everyone aware of this story knows.  So why on earth did shares of Bear Stearns close at about seven dollars the day after the sale price was announced?

The big winners from the Bear Stearns acquisition are Bear’s bondholders. They came close to an event of default this weekend; if all goes according to plan, they’ll soon own nice safe debt from JP Morgan Chase. The only thing which can derail their glide path (if Krugman can mix his metaphors, so can I) would be if the deal doesn’t go through at $2 as planned.

The main thing that needs to happen for the deal to go through is that shareholders vote in favor. And the only way that bondholders can ensure yes votes for the deal is to own those shares and vote them themselves. Says Neubert: “They will eat the difference between where they buy the equity and $2.00 in order to protect much higher numbers in debt.”

There’s another reason for bondholders to buy stock above $2.

…if the deal falls apart, the value of the company might go down, all the way to zero eventually. But on the way there, volatility will be huge – and if volatility is high then the value of the equity will go up. In this sense, the equity is a hedge against the deal falling apart. If JP Morgan doesn’t buy Bear, bondholders’ bonds will fall in value – but their stock will rise, helping to offset the loss.

So, shares of Bear are going up because Bear’s bond holders are hoping those shares go down, and are planning to vote for the shares to be sold for less than they paid for them.  But the shares also make a nice hedge for them, since if the sale fails, their bonds will become worthless but their shares will go up.  But nothing about this at all speaks to any macro positive news about the state of the economy.

America’s most valuable blogger (which I’ve been saying for a while, but it is great to see much bigger bloggers than I agree), has a must-read post countering some of the worst anti-drug legalizations arguments out there.

It wrongly assumes that the all of the problems we associate with drugs–the bloody turf wars, the presence of particularly potent drugs like meth, the lengths to which dealers will go to get their premium, etc.–are the product of the drugs themselves, and not the product of them being prohibited. This chart helps slay that argument. When was the last time you heard about a Michelob deal gone bad?

Read the whole thing.