From Eric Dondero:

And so it begins... The first real signs that we are returning to the 1920s and prohibition. Only this time, it's tobacco.

From Reuters,"Taxed out" New York City smokers roll their own":

bootleggers, bodega owners and even corrupt cops peddling black market cigarettes. The high price of cigarettes has prompted tales reminiscent of the prohibition days of the 1920s when alcohol was illegal.

Smugglers often drive truckloads of smokes into the city from cheaper outlets, such as Indian reservations where no sales tax is collected, and affix fake tax stamps on packs.

A recent General Accounting Office report calculated that a trip from Virginia to New York City with a single case of 12,000 cigarettes -- about what would fit in the trunk of the average car -- could net $3,000.

"It's astonishing how much revenue is being lost to the black market," said Scott Drenkard, an analyst with the Tax Foundation, a non-partisan think tank.

New Yorkers are also resorting to an age old trick of just rolling their own cigarettes.

At Island Smokes, customers pay $3 a pack if they make a carton of cigarettes. By comparison, one pack of 20 cigarettes averages $11-$13 a pack in the city and can be as high as $15.

Predictably, the bureaucrats are getting pissed at all the lost revenue:

Joe Green, spokesman for the New York office of the Bureau of Alcohol, Tobacco and Firearms says untaxed cigarettes are not a victimless crime. He said tax revenue pays for education and other services and that stores selling contraband cigarettes put law-abiding stores out of business.