Cigarette Burn, New York Post

Smokers, after shouldering price hikes for years, have mounted a sullen strike. (Legal) cigarette shipments were down 5 percent last year -- startling executives and tax collectors, who thought that the smoker would always keep smoking without regard for damage to lungs or wallet.

But the state Health Department said last week that 188,000 New Yorkers have quit smoking since 2000 -- mostly due to tax hikes. If the feds force Big Tobacco to hike prices again, Silver, Bruno and Pataki may find that they've built their budget on the wrong end of a tipping point -- consumers may be unwilling to pay $8 a pack, and tobacco payments to New York would shrink.

And what if Big Tobacco won't settle -- and opts for a game of chicken with the governors' lobby?

This possibility illustrates the real danger of the states' collusion with cigarette salesmen: States are now major creditors -- and thus agents -- of Big Tobacco. Tobacco execs know that states -- led by Pataki and California Gov. Arnold Schwarzenegger, whose two states get more than a quarter of the tobacco-settlement proceeds -- would have to fight the Bush administration to avoid an industry loss at trial, to save the tobacco companies and themselves.

Thus, the states' fiduciary relationship with Public Health Enemy No. 1 -- one of intimate and consummate hypocrisy -- will seep upwards to the federal level. The feds, with their own federal deficit and mushrooming health-care costs, could become just as dependent on a regular tobacco take.

Because Pataki and other big-state governors across the country have utterly failed to manage their state budgets, Big Tobacco has finally become too big to fail -- and a federal settlement of the RICO case will ensure that it never will.