Sonny, it's probably another example of the bad writing that pollutes GFIII. It doesn't make any sense. Neither Michael nor any other Don would walk away from profits, no matter how dirty. Michael was no longer involved in the day-to-day operations of the "Olive Oil Business" under Zasa. But Zasa was into drugs--and I'll bet Michael got a tribute from Zasa after having turned the business over to him.

Perhaps the "Palermo is strong" line is a reference to the "Pizza Connection," which, as you know, was a Bonanno Family drugs pipeline to Sicily, organized by Carmine Galante, and which brought "zips" (Sicilians) into high places in that family.