I am a Schumpeterian not a Keynesian economist, but what are the rest?
In economic policy, timing and scale is everything, but so is the design of the policy mix and a sound understanding of industrial demand dynamics and employment structure. Building houses, for example may produce growth, but it has just produced debt and inflation when demand -lomg term - was unsustainable and it produced an unsustainable economic dynamic. Income distribution towards building up average incomes without inflation is part of this benign design.
Krugman is absolutely right! But, why should this be a surprise? Too many crap economic policies have dulled the professions's understanding of the basics. Fortunately, Krugman is not among those that do not understand very simple economics. Perhaps, we need to take away a few economics PhD's from the others? Or, do they try to push median incomes into the ground and to create unemployment.
http://www.ibtimes.com/articles/342853/20120518/krugman-fiscal-stimulus-paul-unemployment.htm
Scratches to Sketches