When you're in a Keynesian hole . . .

Keep digging, says Nobel laureate Paul Krugman, in the NYT.

Try something different, says Ambrose E-P in the Telegraph.

I'm not confident enough of my grasp of macroeconomic theory to comment on what form of stimulus is more likely to get the US engine running again.

But as an historian I do know that Krugman, I must presume knowingly, is grossly oversimplifying why World War II lifted the USA out of the Great Depression. First of all, the Roosevelt administration took the opportunity to force Britain into a fire-sale of assets.

Secondly and far more significantly, wartime forced savings resulted in a massive surge of pent up demand after the war, which the country's greatly increased manufacturing capacity was able to satisfy while effortlessly winning international markets from its shattered European competitors.

None of those conditions apply today; and Krugman certainly knows, from his own lifetime, that Keynesian stimulus without those conditions resulted in the stagflation of the 1970s.