ALISTAIR Darling's pledge to spend his way out of recession revives an economic theory which has been out of fashion for some time.

It was the economist John Maynard Keynes who argued in response to the mass unemployment in 1920's Britain that governments could stimulate the economy by spending their way out of a downturn.

Now that it is obvious the country is heading into a recession, the chancellor Mr Darling has announced he is to revive this theory and spend, spend, spend to keep the British economy afloat.

For some this may be seen as the government showing steely determination to take real control of an economic situation which is now beginning to bite.

For others, it is a dangerous policy which will merely store up problems for the future.

In our view there are merits in the idea but there is also a need for caution and for strict monitoring of how and where the money is to be spent.

The key problem being that in order for this policy to work the government spend will have to be enormous.

It will take significant investment in major construction projects of schools, hospitals and housing or the effect would be negligible.

And the problem with that is that will be hugely expensive for a government which has already invested hundreds of billions of pounds in shoring up our banking system.

The only way for Mr Darling to spend is to borrow and what has been so starkly illustrated in recent weeks is that huge debts tend to have the habit of causing their own set of problems.