By HENRY J. STERN

We took note last week of Democratic Senate leader Malcolm Smith's highly unusual remarks to a conference of lobbyists, in which he said that early contributions to the Democrats' war chest would be similar to participating in an IPO in business. An IPO is an initial public offering, where stock is offered for the first time to the general public, rather than being entirely owned by insiders, often the company's founders. If a stock rises, the purchasers at the IPO will make more money than those who buy later.

Since taking money to influence one's vote on legislation is a state crime, there was a problem if Senator Smith's remarks were to be taken literally. When the story was published, the Senator explained that it was all a joke, that he was simply trying to entertain the visitors after their golf games were rained out.

It is true that Senator Smith was joking, but his joke consisted of telling the truth to the chickens who were being plucked. It is a joke because it is unexpected. Most pols would simply lie while they sucked the prey dry.

The role of wit was first described by none other than Geoffrey Chaucer (1343-1400), who wrote, in Canterbury Tales, "A man may seye full sooth in game and pley"

In 1665, a scant 343 years ago, the Roxburghe Ballads contained the saying: "Many a true word hath been spoken in jest."

The world knows that people, and causes, receive more favorable consideration if they have made appropriate contributions to those in a position to be helpful. So it is, and so it has been for as long as the mind runneth. One hand washes the other. In some cases, anger at graft is a matter of degree - how much is expected compared with how much is given. There is also a matter of timing. A feminist group is called Emily's List. Its acronymic maxim is, "Early money is like yeast."

If there is a disconnect between the parties on the size of the gift or the speed of its delivery, there will be volatility in the relationship of predator and prey, until the gap is at least narrowed. A side gift or two may ease the situation, particularly if they are not reportable.

No one, on either side of a transaction, licit or illicit, likes to be shorted. That is what happens when the cops find a drug dealer or buyer shot to death, and they tell the press that it was "a drug deal gone bad." Or "gone sour." What then is a good or a sweet drug deal? It is when full value is paid, without skimming, and the drug itself is not thinned or adulterated with cutting agents, and both buyer and seller are satisfied.

Peace Before Primaries

The Legislature convened last week, for a special session at the request of the governor, expressed in an unusual 5-minute radio and TV address to the state. It is in the interest of all three men in the room to come to an agreement that would appear reasonable to the public and to their supporters, whatever it actually is or not.

Senator Skelos wants to hold his tiny Senate majority by showing he is for lower taxes and not an obstructionist. Speaker Silver wants no new conflicts before his Sept. 9 primary, and Governor Paterson does not want to appear isolated so early in what he sees as his first term. The triumvirs compromised quickly, rather than after prolonged negotiations, while assuring their supporters and funders they had fought to the end on their behalf, and if they were not there, the outcome would have been much worse.

Governor Paterson came off quite well in all this, showing strength in dealing with both houses in Albany.

It will be fascinating to see what happens if the Senate turns Democrat. We predict it will be no easier to reach agreement if the three men in a room are all from the same party. This is in part because the leaders will feel somewhat responsible to the more extreme members of their conference. Weakness by the leaders, or their successors, would give their colleagues, their natural rivals, the opportunity to adjust the balance of power in their favor.

The basic problem, in New York, is that there is a substantial structural imbalance in the budget, which almost everyone knows full well. While the spendthrift Federal government can print and borrow trillions (until someone or something pulls the plug), the 50 state governments must squirrel away their borrowing with a variety of subterfuges.

There are different versions as to whether, and if so to what extent, pork was reduced in New York State. We must wait for the budget to be printed and examined by experts before choosing sides. Oral comments are often wrong. One object of budget making is to make everyone feel that they received the best deal possible while spending the least amount of money. That intrinsically requires a measure of deception, so although we may be disappointed, we should not be surprised that public officials speak as they do, on different days and to different audiences.

The strain of campaigning becomes acute as elections approach. Old enemies come out of the woodwork to seek revenge. Sometimes long-held grievances result in unusual endorsements, often more informed by who is being opposed rather than by who is being supported. Some claims have merit, but what is a reasonable time frame? What is appropriate retribution for real or fancied slights? And what is the just result if the accused is more competent than his/her challenger?

StarQuest@NYCivic.org