The Philadelphia Experiment: Firing Line

Out of control spending needs to be cut. Period. You can't tax yourself out of a financial hole, it only makes matters worse.
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BOCA RATON, Fla. (

TheStreet

) -- An interesting thing happened in Philly the other day and no, it wasn't the Eagles finally waking up and ditching McNabb. Which by the way was a brilliant decision by the Eagles: send him to another NFC East team so we can have even more opportunities to throw snowballs at him.

But I digress...

On Thursday night the Philadelphia city council approved a $3.9 billion budget for 2011. Shockingly, there was a $150 million budget gap and to close it the council chose to increase taxes. I say 'chose' like there was a choice. For businesses and mom and pop there would be another choice: cut spending (gasp!). I know...I know... I crack myself up.

The one ray of hope in this Philly train wreck was the defeat of a soda tax that would've added .02 to sales of soda and other "sugary drinks" within the city limits. While I applaud the defeat of this measure, the mentality behind it cracks me up. So now we're looking to add sugar to the list of "sins" that the government can tax.

It may shock many of my readers to know this, but like that other famous Buckley, I fully support the legalization of marijuana. The powerful alcohol lobby has successfully kept this fight down, apparently forgetting that alcohol is the worst legalized drug out there. Pay no attention to the man behind the curtain! Many state budget woes would be eased and even eliminated with such a common sense action. There's no 'war on drugs' but there's been a 'Vietnam on drugs'. The 'war' was declared by President Nixon in 1971. How we doin' so far?

Billions wasted in fighting a war against a drug that if legalized, regulated and taxed appropriately would reduce crime and the overflowing prison population. And for those of you who send me love letters about being a Republican, let me clear up where the Whiz Fighter comes down: I'm a libertarian (not quite Thetian Level 5 yet). But I digress again...

Back to the City of Brotherly Love. The city council decided to plug the budget gap with a 9.9% jump in property taxes. Here's the best part. Are you sitting down? According to city officials, "that increase will only last for two years." LOL! My side... Wow. Does anyone actually believe that two years from now this will go away? Are you high?! Well you better not be because it's illegal. Maybe the city official was drunk when he said this with a straight face.

Back to the soda tax. When Mayor Nutter was out and about meeting his subjects one day espousing the virtues of the sugar sin tax, he bumped into a woman whose husband worked locally for Coke.

According to NBC Philadelphia she said, "If you raise them taxes, what do you think the chances are that my husband will still have a job," she told the Honorable Nutter.

"We have a $150 million deficit, I understand your concern, your husband works for Coke, I get that," the mayor said.

So what puts a smile on my face is that this left wing Democrat finally recognized that raising taxes in this manner would cost jobs. A lesson I wish his national party would recognize.

NBC Philadelphia also reported that "a spokesperson for the mayor says the approved budget is a 'step in the right direction.' But they're afraid unforeseen costs like snow removal and newly negotiated union contracts may put the city back into the red."

Ah the unions... More to come.

Firing Line: Out of control spending needs to be cut. Period. You can't tax yourself out of a financial hole, it only makes matters worse. A wise Marine once told me, "When in a hole, cease digging".

Matthew "Whiz" Buckley is the chief strategy officer of

Options University

, a provider of options education for options traders of all levels. . He is also the founder of Strike Fighter Financial, a business-consulting firm specializing in leadership development, risk management and strategic planning for Fortune 500 companies and related organizations. Buckley flew the F-18 Hornet for the U.S. Navy. He's a graduate of TOPGUN, has close to 400 carrier landings and flew 44 combat sorties over Iraq. After leaving active duty, he worked as managing director of strategy at a Wall Street firm and CEO of a financial media company. He is an internationally recognized speaker and combined his experiences in the military and corporate America in his book "From Sea Level to C Level."