Insight 2: Keynes For Our Times - The Rationale for Stimulus Plans Perhaps the most famous demand management programme of all time is President Roosevelt’s New Deal, which helped restore employment during the Great Depression (although some economists argue it did not ultimately put an end to the Depression). In one of his fi reside chats, President Roosevelt sug-gested Keynes’ central insight was that government policies can be used to boost aggregate demand, thereby in-creasing economic activity and reducing unemploy-ment. He argued that responses to depression should stimulate the economy with an inducement to invest through a combination of two approaches: a reduc-tion that it was up to the government to “create in interest rates and government investment in an economic upturn”, by making “defi nite addi-tions infrastructure. to the purchasing power of the nation”.23 At Investment by government boosts workers’ in-comes, the time however, proponents of the New Deal were not typically associated with Keynesian arguments for government spending as a vehicle for recovery, as they favored balanced budgets. The New Deal did in fact engage in defi cit spending since at least 1933, but the Democratic party was typically apologetic about this, because the rise in national debt opposed its party philosophy. resulting in more spending in the general economy, thereby stimulating production and investment, and resulting in more income and spending. The original stimulus investment initi-ates a virtuous circle of economic activity, with the total effect some multiple of the original invest-ment. 20 Confronting the Crisis: ICT Stimulus Plans for Economic Growth