I am normally a bit wary of the views of Kenneth Rogoff since the austerians in Washington, London and Berlin placed too much emphasis on his research which last year was discredited with a critical spreadsheet error.
However, Kenneth Rogoff is one of the World’s leading economists and I am seriously encouraged when he concluded (quoted directly from FT):
I am certainly not arguing that the UK or other advanced countries handled the post-crisis period perfectly. There should have been more infrastructure spending, even more aggressive monetary policy and probably more ruthless bank restructuring. But there has to be a balance between stimulus and stability.
For me, there is still an overwhelming case for policy-makers in London and Berlin to stimulate demand with top quality infrastructure spending (I would normally argue the same for Washington but it’s meaningless with the current standoff between President Obama and the Republican Party’s Tea-Partyists).