I wonder if rent-seeking and other forms of non-productive passive income aren't at the root of it all. We're generating wealth and value and "growing" the economy, but how real is that growth when a) nothing is actually being produced (i.e., there's no product with inherent value), and b) wages don't increase anyways.
All this wealth is being generated, but it's going disproportionately (historically speaking) to the wealthy. Well, the problem with that is that the wealthy have an extremely low marginal propensity to consume, so, all they do is invest. That means that both more wealth is available to build businesses and less wealth is available to purchase the resulting products. So, it's easier than ever to create a business because investment dollars are cheaper than ever, but it's harder than ever to make it profitable because nobody's buying. That should depress costs, but the race against inflation has got to catch up eventually. You can keep making it cheaper and cheaper to run a business, but if wages don't increase and cost of living continues to increase just due to inflation, then it doesn't matter how cheap your goods are. There's no middle class left with the money to purchase luxury goods. Then what?
Edit:
> Austrian economics doesn't claim that short-term inefficiencies do not exist in markets, but rather that they are less harmful than attempts to fix them.
This seems -- at least partially -- bogus on it's face. Sure, you can definitely regulate a market into collapse (see the Soviet Union) but deregulation can just as easily create supermonopolies which are equally unjust and ineffective. The point of the market isn't to generate wealth, it's to distribute resources efficiently so that the nation as a whole (or state, or world, or whatever collective noun you want to use for human civilization) gets their required products. Generating wealth is a complete side effect of the market as far as the benefits to society are concerned.