Thursday, January 15, 2009

Paterson's "Make My Day" Moment

The Seneca Indians-much as The Mouse That Roared of movie fame-is taking on NY State government in a challenge to the effort by the governor to insure that the tribe collects taxes on all cigarettes it sells to non-Indians. The challenge is to set up their own toll booths on the NYS Thruway. Here's how the NY Post describes this outrage: "Now this is clever: The Seneca Indians, smarting over Gov. Paterson's latest attempt to collect taxes on their booming illicit cigarette trade, this week announced they'd retaliate by slapping their own tax . . . on the New York State Thruway. It's an "illegal business," too - or so the tribe would have it."

What a great opportunity for Paterson to demonstrate that he has the capacity to lead-and to forcefully insure the rule of law. The tribe simply has no legal leg to stand on: "But while the tribe may couch its behavior in high-sounding terms like "sovereignty" and "treaty rights," all they're really showing is a breathtaking contempt for the rule of law. The US Supreme Court ruled 15 years ago that states have every right to collect taxes on reservation cigarettes sold to non-Indians - the vast majority of the Seneca trade. And their Thruway nonsense runs afoul of a 1954 agreement - upheld by a federal court - in which the state paid for the right of way."

But what the Seneca are planning is open insurrection: "Indeed, to hear Seneca leaders talk, you'd think they were already in open rebellion: "Our concern as nation leaders justifies taking any and all prudent actions to protect and defend the nation's economy and the way of life of the Seneca people," declared the tribal president, Barry Snyder - himself a big-time cigarette retailer. And "prudent actions," for the Senecas, are sure to include organized violence. After all, the last time the state tried to enforce the tax, in 1997, bands of Senecas set fire to tires piled on the Thruway and brawled with state troopers who came to clear them away."

Make no mistake about it; this is a declaration of war-and it needs to be met with the appropriate forceful response. In fact, as the governor gets his troops ready, he should propose to the legislature an even more fool proof piece of legislation than the one recently passed that addresses the Seneca (and other tribes) tax evasion practices. The new bill would require that the cigarette manufacturers remit all taxes on their products before their products are even delivered to local wholesalers. Collection simple; case closed.

As far as the Seneca threat, Paterson should be clearing out enough prison cells to accommodate the entire lot of them. As the Post righteously states: "Back in '97, of course, then-Gov. George Pataki responded to the violence by caving in - setting off another dozen years of tax evasion that enriched criminals, starved state revenues and put the squeeze to law-abiding retailers. Paterson can't afford to make the same mistake."