Dan brings up the money thing from last week, and Rufus says that the money issue is over, because Lily fucked it all up and got Serena arrested in the bargain. "I suggest you kids stay out of it. Let these van der Woodsen women fight it out themselves." Jenny tries desperately to care, but considering it's Rufus-related, it's like really hard.
Lily has about one thousand memories walking down the hallway in the police station, which seem really meaningful but actually are just snapshots from the episode to come: her Dad driving away, a picture of herself as a child with her sister. Maybe Owen died, maybe CeCe had him murdered, but either way it's just sort of stuff that happens, and since we haven't met Owen yet it's just some guy's horrible face for a second, fading away.
Serena, whom it would seem has the run of the police station, is hanging out in some office giving her mom the stinkeye when she comes in. Lily's like, "Have you learned your lesson?" I guess the lesson "don't not steal things" is a biggie for them. Serena says the only lesson she's learned is that Lily is crazy, and Lily calls her to task once again for solving the huge problem that she solved last week before Lily fucked it all to hell. Lily lays some speech on her about how moms don't always win popularity contests, and Serena says when she's a mother she will be nothing like Lily, and in fact would rather give her kids up for adoption than be like Lily. "Oh, wait. You did that." For Serena's first attempt at sarcasm, it's pretty good, but also incredibly mean. Lily says she's there to chillax and put the whole thing behind them, and Serena's like, "I didn't even call you." Whom did she call?
CeCe, who appears behind Lily and leans in with a stage whisper: "Ironic, isn't it? If only she knew." What CeCe means is that Lily once got arrested for an even stupider reason.
"For those who complain about the youth of today: if you think we're bad, you should've seen our parents!" What Gossip Girl means is that Lily once got arrested for an even stupider reason. Everybody needs to take five minutes and explore the actual definition of "ironic," because this isn't ironic, because in fact there is no parallel to be had here, because of all the failures of this episode -- and there are only slightly more failures in this episode than there are awesome moments -- the fact that Lily got arrested for being at a party and hitting a man with her purse once in 1983 is, considering what a constant crutch it is for the whole first act, a largish one.