Keynesian Theory and the New Deal

This would      
slowly start a chain reaction and bring the economy back to the way it     
was before the depression. By the end of the 1930's this plan had          
lowered unemployment to 17.2%. To make these organizations it was          
going to take money. Roosevelt had to deficit spend, which is when the     
government spends more than their budget in one year, in order to          
obtain this money. Of course these ideas of supply and demand and          
active government didn't just come to him. He was influenced by John       
Maynard Keynes and John Stuart Mill. There philosophies were the basis     
of the New Deal. John Stuart Mill, who began studying economics at age     
13, was one of the most influential political thinkers of the              
mid-Victorian period. He believed in empiricism and utilitarianism.        
Empiricism is the belief that legitimate knowledge comes only from         
experience. Utilitarianism is the belief by which things are judged        
right or wrong. It is judged according to their consequences. In a way     
he was a hypocrite. When the economy was good he believed in               
Laisezz-Faire, which means "hands off." If the economy was bad,            
though, he believed in an extended role of government. This simply         
meant that the government should take part in the economy and try to       
make it better. The New Deal was a very active government plan because     
it had the government working directly to make jobs and fix the            
economy. Mill died in 1873 and would never had a chance to talk to         
Franklin D. Roosevelt. In a press conference Franklin D. Roosevelt         
once said, "I brought down several books by English economists and         
leading American economists, I suppose I must have read different          
articles by fifteen different experts."(Schlesinger, Pg.650) This          
writing indirectly steered Roosevelt towards a plan which expanded the     
role of government. Mill gave Franklin D. Roosevelt the basis of the       
plan, but it needed to be elaborated on. John Maynard Keynes was the       
man to do this. John Maynard Keynes, one of the most influential           
economists of the 20th century. For many years he was an active voice      
in economics. In 1929 he wrote We Can Conquer Unemployment and in 1930     
he wrote his Treatise on Money. Ten years before he died he wrote his      
General Theory of Employment, Interest and Money. Above all he             
believed in supply and demand. This was an indirect way to let the         
economy balance itself.