Jubilant 'No' campaigners were celebrating on Friday after North East voters rejected an elected regional assembly by a margin of three-to-one.
"No" campaigner John Elliott shows his delight
North East Says No chairman John Elliott praised voters for standing up to ministers and the local "political
establishment", who backed the plan.
"This is a sign of a confident North East," he said.
The Yes campaign was licking its wounds after each of the 23 council areas involved rejected the scheme.
In some cases, the No campaign triumphed by as much as seven-to-one.
Turnout was higher than expected at 48.36%.
Yes4theNorthEast chairman John Tomaney acknowledged the "resounding" defeat.
But he said the result highlighted a deeper problem with British politics.
"There is a larger message here and in view the result says something about the state of politics and parties in the UK," said Professor Tomaney.
And - he argued - the result would do nothing to address the region's deep-seated economic problems.
"The vote for No is not going to solve the problems of the North East, such as jobs, the lack of skills and narrowing the gap between the North and South," he added.
Independent Middlesbrough mayor Ray Mallon, a late recruit to the Yes campaign, was putting a brave face on the defeat, saying the contest had at least put "some colour" into local politics and made it less boring.
He insisted there were ways other than an assembly of uniting the region and bringing change.
"I am a positive and optimistic person and we are going to progress the regional agenda," said Mr Mallon.
But the former police chief also admitted he had struggled to find a way of effectively promoting the benefits of an assembly.
He said: "One person said to me this week it might have been easier selling sand to an Arab than selling regional government to the public.
"But I believe the concept was the right way forward."
Deputy Prime Minister John Prescott, who has invested considerable political capital in the project, said he was "surprised" by the scale of the defeat.
And the government would have to work out what lessons could be learned from it.
Mr Elliott, a Eurosceptic local businessman who set up NESNO in June, insisted he had not been motivated by a desire to give the government a "bloody nose".
He said: "I am sure they are honourable people. But I would rather John Prescott has two weeks embarrassment than us be saddled with a £25m white elephant."
He also acknowledged the need for a re-organisation of local government - and a stronger voice for the region.
"There is a big issue with the role of central government and local government - central government interferes too much and maybe local government does things which are too big for them and they should stay more community-based.
"One of my concerns about the regional assembly was it lets central government off the hook because they could say `You have a regional assembly - let them deal with it.'
"We shouldn't be begging government to do things for us - we should be getting what we are entitled to."
Although backed by the Conservatives and UKIP, NESNO was careful to keep the politicians in the background.
It concentrated instead on promoting the message that the assembly would be a costly job creation scheme for "political placemen", summed up by its slogan "Politicians Talk, We Pay".
Neil Herron, who ran his own 'No' campaign from his Sunderland base, said the assembly had been a "political project" that "was never going to get past the people".
But he called on No and Yes campaigners to bury their differences and "work together and drive the region forward", because the status quo was not good enough.