Several studies show that the expansionary effect of lower interest rates has often outweighed the contractionary effect of lower government spending.

ECONOMIST: Tightening economic policy

This does not mean that monetary policy alone can offset the contractionary effect of the current massive disruption in the credit markets.

WSJ: The Fed Still Has Plenty of Ammunition

The contractionary effect of the end of 5 years of loose Fed monetary policies will hit the economy at the same time as the already enacted tax rate increases due to Obamacare and the expiration of the Bush tax cuts.

FORBES: Wasteful Politicians, And The Fed's Coming Recession