The North East will suffer badly from the hell-for leather cuts unleashed by the "tax and axe" Budget.
A hapless minister let the cat out of the bag when he blurted out in the Commons that those in greatest need ultimately bear the burden of paying off the debt. We have been here before with the Tory Party's faith in the market that inflicted the depression of the 1930s and the recession of the 1980s. These cast a long shadow over regions like ours to this day. This Government lacks a mandate for this. The Lib-Dems opposed Tory cuts this year as did Labour and many more people voted against than backed this over-reaction.
The Lib-Dems then cobbled together a coalition with the convenient fig leaf that they had changed their mind because of events in Greece. We should be more worried about Japan where cuts before recovery plunged the country into a deeper and long recession.
Ministers claim that places like the North East are over-dependent on public spending and are dogmatically wedded to shrinking the State in the belief that this will free the private sector.
TUC chief Brendan Barber rightly says:
"Far from holding back the private sector, the public sector educates and trains their workforce, buys many of their goods and services, keeps their staff healthy and provides the vital infrastructure without which the UK would travel back to the 19th century."
Take a local example. At Christmas 2008, Nissan was on the edge and 1,200 people faced the dole. Nissan worked with MPs, local councillors and colleges to keep people in work and training. When Nissan's fortunes picked up, the factory went back to work and is doing better than ever.
Yet the Government is going to scrap One North East which has done so much good work in helping private industry. The Government should reduce borrowing with fairer taxes.
It should focus on fat-cat tax evasion: 20,000 tax collectors lost their jobs in recent years to save just £100m, but evasion and avoidance cost up to £120bn. The Government should close that gap first.
My own union, Unison, suggests several options to save our services. For example, a 50% tax rate on incomes over £100,000 would raise £5bn a year, while £15bn could be raised by stopping tax reliefs which subsidise incomes over £100,000.
The Lib-Dems received a sop with a slight increase in the threshold for paying tax, but service, job and benefit cuts as well as other tax rises will devour this small handout.
I welcome the bank levy but it's far too modest and the banks could cough up more: £30bn could be raised every year by introducing a Robin Hood tax on UK financial institutions. The Government keeps spinning the lines that the deficit is due to Labour's reckless spending and that we are all in this together.
These mantras are like vuvuzelas, an irritating background buzz, trumpeted by George Osborne. Saying something often and loudly does not make it any truer.
Our debt was racked up because we had to clear up the mess caused by the banks. We know those with money will be looked after and those without will go to the wall.
We are two nations, split by geography as well as history and, left to themselves, markets have failed. Why slash vital services and jobs when people who have robbed this country blind are getting away with more robbery?
We cannot defy gravity by denying that the deficit should be reduced. The big question is how ... but this Government is going too fast in the wrong direction.
Newcastle Chronicle and Journal
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