Last Monday I briefly discussed what U. S. economic history of the past decade reveals about the effectiveness of Keynesian macroeconomic policy. Like it or not, monetary inflation and government spending have not produced prosperity in the U.S. They have done just the opposite.
Robert Murphy has also written a nice piece on Mises.org documenting the same thing. Drawing upon empirical work done by the European Central Bank and economists Carmen Reinhart and Kenneth Rogoff, Murphy compares actual historical examples from several different countries against the Keynesian rhetoric of Paul Krugman and Krugman comes out the loser. Contra Krugman, the various historical examples all tell the same story. Fiscal stimulus does not stimulate.