That’s the whole point of technology: achieving more with less. It’s also part of the promise of technology: freeing people from annoying social structures that they wish they could opt out of, anyway. But there’s a problem: 30-year treasuries and defined-benefit pension plans don’t pay out in terms of hours of enjoyment or numbers of yoga classes—they pay out in dollar terms. A heavily indebted country doesn’t have the freedom to allow deflationary forces without facing some serious consequences. Interestingly enough, these consequences are somewhat balanced: older people tend to spend far more money on the Internet, and they tend to get far more of their income from fixed income sources, whatever those might be. So this web-based deflation will transfer money to older, wealthier savers—who will promptly transfer some of it right back to web companies. Whether that is an unstable equilibrium or a self-balancing one depends mostly on whether or not web companies will hire more people.
That's Byrne Holbert at Digital Due Diligence.