Scott Sumner sums up contemporary stimulus proposals well
...Old hydraulic Keynesianism from the 1960s was already a pretty implausible model. But what's happened since 2009 involves not just one , but at least five new types of voodoo:
1. The claim that artificial attempts to force wages higher will boost employment , by boosting AD.
2. The claim that extended unemployment benefits---paying people not to work---will lead to more employment , by boosting AD.
3. The claim that more government spending can actually reduce the budget deficit , by boosting AD and growth. Note that in the simple Keynesian model , even with no crowding out , monetary offset , etc. , this is impossible.
4. More aggregate demand will lead to higher productivity. In the old Keynesian model , more AD boosted growth by increasing employment , not productivity.
5. Fiscal stimulus can boost AD when not at the zero bound , because . . . ?
In all five cases there is almost no theoretical or empirical support for the new voodoo claims , and lots of evidence against. There were 5 attempts to push wages higher in the 1930s , and all 5 failed to spur recovery. Job creation sped up when the extended UI benefits ended at the beginning of 2014 , contrary to the prediction of Keynesians. The austerity of 2013 failed to slow growth , contrary to the predictions of Keynesians. Britain had perhaps the biggest budget deficits of any major economy during the Great Recession , job growth has been robust , and yet productivity is now actually lower than in the 4th quarter of 2007.