According to the Government, the teachings of John Maynard Keynes could provide the light that will help us find the path to safety during this gloomy time.

Keynes, who has been dead for more than 60 years, would have been bemused by our modern world, with its instant communication systems that can spread destructive rumours in the blink of an eye.

Alistair Darling would like us to believe that Keynes's benevolent spectre is guiding his plan to shield us from the worst of the economic downturn by pouring billions of pounds of our cash into public works.

Despite the dire state of our public finances, which are likely to be placed under even heavier strain by falling tax revenues, Mr Darling plans to press on boldly with spending on large projects.

To quote Mr Darling: "At a time like this, it would be wrong to start taking money out of the economy, in terms of cutting back on spending, in terms of tax. Much of what Keynes said still makes sense. You will see us switching our spending priorities to areas that make a difference – housing and energy are classic cases where people are feeling squeezed. They expect the Government to help them. We'll do that."

Inevitably, this will mean taking on more debt, which is bound to place a severe burden on Mr Darling's successors.

The belief that governments can spend their way out of recession has been unfashionable for years. Since the heyday of Thatcherism, many pundits have argued that the economy should regulate itself. However, the bailout of the banks has shown that, at times of crisis, the Government cannot avoid coming to the rescue of troubled institutions. In the case of the recent banking crisis, failure to act would have had catastrophic consequences.

So would Keynes have approved of his name being attached to Government policy? He's long dead, but thankfully, his life is well documented. A number of biographies, such as Robert Skidelsky's three-volume masterpiece, bring his world to life.

Keynes's last act was his greatest service to the nation. Although gravely ill, he stopped Britain going bankrupt after the Second World War by negotiating a £3.75bn loan from the US. Britain had won the war, but was struggling to feed its people. Keynes's diplomacy saved millions of Britons from starvation. Keynes had a waspish intellect which he could employ to devastating effect. Of one American negotiator, he said: "No wonder that man is a Mormon. No single woman could stand him."

Keynes the economist is best known for his General Theory of Employment, Interest and Money, written during the height of the Depression in 1936.

At the time mass unemployment was the burning issue of the day. Much of Keynes's work is devoted to tackling this issue. As the dole queues lengthen and private sector investment dwindles, the Government can kick-start a revival by spending cash on public projects, Keynes claimed. Keynes's supporters also argued that a policy to keep wages in line with prices would keep inflation under control.

Keynes's beliefs had a powerful influence on policymakers from 1945 until the 1970s, when industrial strife and economic turmoil persuaded the voters to place their faith in Mrs Thatcher and monetarism. But, if the banking turmoil shows that the economy cannot regulate itself, isn't it time for Keynes's teachings to make a comeback?

We are in danger of forgetting how much the world has changed since 1936. Firstly, cutting taxes and interest rates might prove a more potent way of giving the economy a shot in the arm.

Over the weekend, a group of senior economists branded the Government's plan to spend its way out of the looming recession a "misguided and discredited" approach that could make things worse. Secondly – and far more important – the tortuous bureaucratic process means that any grand scheme paid for by the taxpayer could take years to come to fruition. Just think how long it can take to get planning permission for the humblest public building.

Keynes could not have foreseen the mass of red tape that governs our lives. There are dangers of using Keynes's 72-year old work in the same way that a drunk uses a lamppost, for support rather than illumin-ation. Keynes was our national saviour in 1945.

Devising policies based on a simplistic interpretation of his 1930s treatise could have disastrous consequences today.