Clearly, neither of us knows enough of the facts here to make any sort of condemnation. By your own admission, the sister could have seriously exagerated the situation and caused a much larger response than she anticipated (maybe SHE got tired of it?). Mr. Thurber could have exagerated the sitauation in his conversation with the sister. Maybe he's was suicidal and ready to take his entire block out and told that to his sister and is embarrassed about it now.
Until we get more facts, it's all idle speculation. If you have information on why the police felt this was the appropriate response, I'd love to hear it, otherwise you and I are just going to make up our own facts and statistics and probably end up arguing about whether or not the Brazilian death squads were an appropriate response to the pickpocket problem in Rio in the late 80's.