Obama is betting that Keynesian theories will put the brakes on the downward spiral, but in truth those theories have never been tested.

from wiki article

But to many the true success of Keynesian policy can be seen at the onset of World War II, which provided a kick to the world economy, removed uncertainty, and forced the rebuilding of destroyed capital. Keynesian ideas became almost official in social-democratic Europe after the war and in the U.S. in the 1960s.

Keynesian economics have basically been used in the west since 1945, sure you can argue about the effectiveness of keynesian economics but his theories have been widely applied and thus tested... your argument may hold more water if you concentrate on the fact they haven't been tested on this scale..

Since ww2 very few countries have actually followed a free market route such as that advocated by smith, the IMF has put various countries into a smith style economic system, but if you look at the vast majority of countries (or developed ones at least, less sure about 2nd and 3rd world ones) they practice keynesian economics...