WITH the Government poised to give away billions to help families survive the economic storms ahead, Gordon Brown and David Cameron, like Tweedledum and Tweedledee, agreed to have a battle.
One way or another, there's an election looming before this recession is over. Both claimed the moral high ground, but there was more than a touch of politics at play. Is Labour warming to a spring poll before the worst of the recession bites? What b
etter way to oil the wheels of victory than spraying us with cash.
And what's poor Tweedledum, sorry David Cameron, to do now that he has spoiled his nice new lead in the opinion polls? But going to war is a dangerous game, and both men are taking a big gamble.
The Government says it is right to borrow more to avoid an economic near-death experience, even though it has already hit the nation's plastic to the tune of £60bn this year.
Higher borrowing could send the pound reeling, preventing the Bank of England cutting interest rates again. Money borrowed would have to be repaid in the form of higher taxes in the future.
And crucially, tax cuts from next April will come far too late to stop next year's bloodbath. We could end up borrowing all this money pointlessly.
By contrast, the Conservatives claim to be eschewing tax cuts and borrowing, and promise to stimulate the economy by cutting waste.
While this may be sound economics, it risks looking callous and complacent when so many families are about to be rocked by redundancy. And while we can all think of examples of waste by local and national government, getting rid of them will not be achieved overnight.
If the economy needs urgent stimulation to prevent rigor mortis setting in, surely it needs it now.
So which man is right, or are they both wrong? Our best course of action will depend on the scale of the problem ahead. We've been through recessions before, and unpleasant though they are, eventually there is light at the end of the tunnel.
But the worry is that this time there is no light in the distance because the door at the other end has been bolted. We are trapped in a depression and going nowhere. In that case, much more drastic action is required.
A wave of absolute panic broke out last week as company after company slashed jobs and the realisation of the bloodbath that we are facing sunk in.
Yet that nice man at Next, its chief executive Simon Wolfson, is encouraging us all not to take leave of our senses. He has called for a realistic assessment of the economy, stressing that while we are facing a recession, this is not Armageddon.
Others are not so confident and predict a rerun of the horrors of the 1930s, which will be, as economist Paul Krugman so cheerfully put it, "nasty, brutish and long".
For good measure, medieval soothsayer Nostradamus said 2009 would be a year of major disasters including earthquakes, war and famine when "blood will rain on the rocks".
My money is on Wolfson, more of whose jumpers I shall be buying in future.
I mean, think about it. We never called the last recession a depression or slump, yet we had more than three million unemployed and house prices in some areas fell by half. The entire US mortgage industry went bust, as it regularly does. Plenty of UK building societies hit the rocks and had to be rescued.
Yes, it was awful, as the next 12 months will be. But worse than that? I can't see it.
On this basis, I think it's hard to deny the economy needs help, although I would urge the Chancellor not to go too far with his tax cuts. There is a risk to the pound, and anything which prevents further interest rate cuts must be avoided.
Critically, we need money pumping life back into the economy now and cannot wait until April. I would favour an immediate reduction in VAT to boost Christmas spending, abolishing stamp duty and removing the lowest paid from tax altogether.
Above all, interest rates must be cut hard again and Darling must force the banks to pass the reductions on to borrowers.
But Cameron is right too: we have to cut wasteful spending. Nostradamus spoke of an Iron Lady appearing in 1989, a time of great trouble, and saving the world.
But Nostradamus also prophesied another leader of her tribe emerging a decade later from the hill of knots on a two-wheeled chariot. He is known as Call-Me-Dave and is destined for great things. His ambitions come to naught, skewered by a trusted lieutenant, "when blood rains red on blue rocks".
OK, I made the last bit up.
Festive cheer for bargain huntersTILLS were ringing out Merry Christmas last week even though the festive holiday was more than a month away, as shoppers flocked to cut-price bonanzas, writes Teresa Hunter.
There were bargains galore to be had for those willing to spend. Marks & Spencer staged its first one-day event in four years, when it cut prices by 20%.
And while the M&S one-day event has come and gone, sales continue at other stores up and down high streets and on the internet over the weekend. Retailers including Burton, Debenhams, Selfridges and John Lewis have continued to slash prices.
The big giveaway was prompted by fears that Christmas spending had collapsed as consumers looked fearfully to a bleak new year and kept a tight hold on their purse strings. But as ever, the picture is not all it seems.
Data from the Office for National Statistics showed the downturn on the high street was overstated, with sales down a much lower-than-expected 0.1% in October.
But on closer inspection the figures reveal that while food sales rose 1% in October, non-food sales did fall 1.1%. Clothing was particularly hard hit, with activity falling 3.4%.
And some stores are being hit much worse than others. Marks & Spencer saw like-for-like sales fall 6.1% in the 13 weeks to September 27, while Arcadia Group, the owner of such retailers as Topshop and Burton, experienced a 2.8% drop from 2007.
Place your bets for cutsALL eyes are on Chancellor Alistair Darling who tomorrow delivers his Pre-Budget Report, which will be closer to a mini emergency tax-cutting Budget aimed at stimulating the economy, writes Teresa Hunter.
The bookies' favourite is an increase in tax credits to help the least well off, who are also more likely to spend the money than save it.
Darling is likely to announce the continuation of the increase in personal allowances introduced to sort out the 10p tax row. Planned increases to car tax are likely to be delayed. Other favourites include help for small businesses.
To the right are our hot tips, with some help from PricewaterhouseCoopers.
