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In the book "The China Price", a factory worker is discussed who had his hand mangled in an injection molder. He was left to fend for himself with a tiny bit of "compensation" from the factory. No wonder smart people in China want to avoid factory jobs -- they are not like factory jobs in the USA. See:
"The China Price: The True Cost of Chinese Competitive Advantage" by Alexandra Harney
http://www.amazon.com/The-China-Price-Competitive-Advantage/dp/0143114867
"In this landmark work of investigative reporting, former Financial Times correspondent Alexandra Harney uncovers a story of immense significance to us all: how China's factory economy gains a competitive edge by selling out its workers, environment, and future. Harney's firsthand reporting brings us face-to-face with a world in which intense pricing pressure from Western companies combines with ubiquitous corruption and a lack of transparency to exact a staggering toll in human misery and environmental damage. This eye-opening expose offers, for the first time, an intimate look at the defining business story of our time."

China is already moving to increase automation. From a couple years ago:
http://ww5.plasticsnews.com/china/english/headlines2.html?id=1278958338
"In the wake of labor unrest, Chinese factories are adding automation to control rising labor costs. It was bound to happen."

The same issues will play out as in the USA with a declining need for most human labor in all areas. For ideas on what to do about it:
http://www.pdfernhout.net/beyond-a-jobless-recovery-knol.html

I also don't understand why China does not just print money to give out as a "basic income" to Chinese citizens so they can buy Chinese factory products (eventually recycled by taxes when the money supply grows to the right size). While in the past it might have made sense for Chinese factory workers to accept low wages as a sort of "tax" so China could learn how to make things based on Western know-how, it seems that has passed the point of diminishing returns. The big issue is that the Chinese don't have enough cash to buy their own goods, and that should be relatively easy to solve. I guess even the Chinese don't understand modern fiat-dollar economics, let alone the emerging post-scarcity economic model? Of course, I could say much the same about the USA, where there is a shortage of money supply because so much digital cash is either sitting on the sidelines parked in zero interest bank accounts or is in the zero-sum "casino economy" on Wall Street. Related links:
http://www.globalresearch.ca/an-emergency-program-of-monetary-reform-for-the-united-states/5494
http://www.youtube.com/watch?v=Q3p48upXJaA&feature=mfu_in_order&list=UL
http://www.basicincome.org/bien/aboutbasicincome.html
http://www.moneyasdebt.net/

"The economy will never be "post-scacity", as there's only so much shoreline property. "

See: http://en.wikipedia.org/wiki/Space_habitat

However, that is not to completely disagree with your point. It is true that abundances of one thing can sometimes create a complementary scarcity of something else (too much information chasing too little attention). But *material* scarcity is over if we want it -- just like war:
http://imaginepeace.com/warisover/
http://www.youtube.com/watch?v=CbKsgaXQy2k

"Fiat currencies emerged because, as economies grew, you simply couldn't find enough notes to do business"

See:

"Gift Economy: Refuting the Market Logic "
http://www.youtube.com/watch?v=jy4hFVcl6Vo

"Money as Debt"
http://www.moneyasdebt.net/

"RSA Animate - Drive: The surprising truth about what motivates us"
http://www.youtube.com/watch?v=u6XAPnuFjJc

Fractional Reserve banking is a sword that cuts both ways.

Watch this movie for a clear explanation.

Unfortunately, debt *is* money. If you have never seen the video, do yourself a favor and watch it:. Trust me, it is worth your time:

http://www.moneyasdebt.net/

It is fascinating and scary.... and real. Our whole economy is now built on debt, and it really is not a good thing.

To agree with your broad point: http://www.moneyasdebt.net/
See the "Money as Debt II - Promises Unleashed" video. Related except:
http://www.youtube.com/watch?v=rxo_XPdpI_s

It seems to me that once money has moved to the casino economy (like currency speculation), it is no longer available for use in the real economy. This could cause a currency crisis in the real economy, even though the total amount of currency in the system might be huge.

Robotics are going to have the same effect of a concentration of wealth, according to Marshall Brain.
http://www.marshallbrain.com/robotic-nation.htm

"That makes a lot more sense than "quantitative easing" which prints the same amount of money just to give it to a few banks, who then lend it out at rate 10 times that at which they borrowed it."

You've probably seen this, but if not, you might like it:
http://www.moneyasdebt.net/

Parts are on YouTube, and in Money as Debt II there is a great animation of people on a treadmill as debts are created. There is also a section on the "casino economy" where much money ends up just betting on currency fluctuations and such, and is unavailable for transactions in the physical economy.

I liked your points elsewhere about printing extra money, when it is needed, creating more wealth than any inflation. The Social Credit movement argued something like that, and said the printed money should be distributed as a basic income.
http://en.wikipedia.org/wiki/Social_Credit
"Douglas disagreed with classical economists who divided the factors of production into only land, labour and capital. While Douglas did not deny these factors in production, he believed the "cultural inheritance of society" was the primary factor. Cultural inheritance is defined as the knowledge, technique and processes that have been handed down to us incrementally from the origins of civilization. Consequently, mankind does not have to keep "reinventing the wheel". "We are merely the administrators of that cultural inheritance, and to that extent the cultural inheritance is the property of all of us, without exception." Adam Smith, David Ricardo and Karl Marx claimed that labour creates all value. While Douglas did not deny that all costs are ultimately due to labour charges of some sort (past or present), he denied that the present labour of the world creates all wealth. Douglas was careful to distinguish between value, costs and prices. He claimed that one of the factors leading to a misdirection of thought in terms of the nature and function of money was economists' obsession over values and their relation to prices and incomes. While Douglas recognized "value in use" as a legitimate theory of values, he also claimed that values were subjective and not capable of being measured in an objective manner. Thus, he rejected the idea that the role of money is to act as a standard, or measure, of value. Douglas believed that the role of money is distribution of production. ...
Douglas believed that it was the third policy alternative upon which an economic system should be based, but confusion of thought has allowed the industrial system to be governed by the first two objectives. If the purpose of our economic system is to deliver the maximum amount of goods and services with the least amount of effort, then the ability to deliver goods and services with the least amount of employment is actually desirable. Douglas proposed that unemployment is a logical consequence of machines replacing labour in the productive process, and any attempt to reverse this process through policies designed to attain full employment directly sabotages our cultural inheritance. Douglas also believed that the people displaced from the industrial system through the process of mechanization should still have the ability to consume the fruits of the system, because he suggested that we are all inheritors of the cultural inheritance, and his proposal for a national dividend is directly related to this belief."

See also for points on the breakign link between work and income, from 1964:
http://www.educationanddemocracy.org/FSCfiles/C_CC2a_TripleRevolution.htm

Anyway, more hopeful/collaborative reading that many people have long been trying to deal with this social disease of greed and fear and ignorance, even while there is plenty to go around, and more and more every day.

I don't ag

To support your points, consider:
"The Two-Income Trap" (about needing two incomes and being more precarious)
http://motherjones.com/politics/2004/11/two-income-trap
and:
"Capitalism hits the fan" (about 30 years of stagnant wages)
http://www.capitalismhitsthefan.com/

Still, I feel the grandparent post is right about taxes. A 90% progressive maximum tax rate would help deal with a growing rich poor divide, and the fact that since it takes money to make money, the rich tend to get richer, and then a centralization of capital leads to the free market and capitalism breaking down (small businesses can't get started, etc.). Also, there are some needed things that business just won't do because of the risk or time horizon or externalities. That tax rate is part of what pulled the USA out of the Great Depression (justified at the time in part by WWII).

As far as government debt, it could be paid off tomorrow by just printing the money (which can be non-inflationary if the money printed matches the growing need for it). Related:
http://www.amazon.com/Creature-Jekyll-Island-Federal-Reserve/dp/0912986212
http://www.moneyasdebt.net/

Debt by the US government and also citizens for mortgages is a tricky thing, since our economy is based on debt to create money. I think we'd probably be better off with some other approach eventually. Ideas on that:
http://knol.google.com/k/paul-d-fernhout/beyond-a-jobless-recovery

I'm working on a related system to what he describes towards the end of the article -- something that is a partnership between the individual musician and a the computer, to amplify musical creativity, for the Android Smartphone. It's almost ready to release...

People at IBM Research in the past (a decade ago) also did some things also to amplify musical creativity using computers, but unfortunately did not get as much support as they deserved:
http://www.alphaworks.ibm.com/tech/musicsketcher/
http://domino.watson.ibm.com/comm/wwwr_seminar.nsf/pages/sem_abstract_186.html

As David Cope says, part of our musical future may well be more about a partnership.

It's been said, "the woods would be pretty quite if no bird sang there but the best". The real reason to do music is because humans are musical creatures, however they want to express it.

The whole issue of "fame" or "income" is linked to dysfunctional social systems and dysfunctional economic systems. The real issue is that we need a "basic income" for everyone to reflect a human right to draw from the industrial material and informational commons, especially because more and more human labor is becoming worth less and less due to increases in automation, better design, and limited demand (as humans get enough stuff and move up Maslow's hierarchy of needs to self actualization which often can be done fairly cheaply). More ideas I helped put together here:
http://en.wikipedia.org/wiki/Jobless_recovery
And here:
"Ideas for a brickfilm and video games to help avoid a Caprican future"
http://groups.google.com/group/openmanufacturing/browse_thread/thread/cf4ee7f45d631838#

I think we are seeing that now with health care. Much human labor is no longer valuable enough in the USA to earn the money to pay for health insurance -- even as some very few medical specialists who practice medicine or make medical devices (including medical robots) can command vast sums of money for their expertise. Of course, we don't need that many more medical specialists (even if more might be nice), so there is no easy solution to that since we don't need everyone to be a doctor or medical robot maker; so, ultimately, the government will have to intervene more in a dysfunctional marketplace, once the populace moves past the secular religion of "The Market as God".
http://www.theatlantic.com/issues/99mar/marketgod.htm
Capitalism won't work well unless wealth is widespread, and that means the government has to step in and keep money flowing. Otherwise, the rich just put excess money into a "Casino economy" of derivatives and currency speculation that has little relation to the real world. See:
http://www.moneyasdebt.net/
http://www.capitalismhitsthefan.com/

As robots can do more labor, whether creative as in putting together music or physical as in putting together food:
http://www.hizook.com/blog/2009/08/03/high-speed-robot-hand-demonstrates-dexterity-and-skillful-manipulation
http://www.youtube.com/watch?v=nv7VUqPE8AE
we will need a completely new economic ideology if we are to survive the irony of real starvation amidst theoretical robot-produced abundance.

People have been talking about this since 1964 and even before:

Thanks for the great reply. You make some great points. And it is true, most people in the USA have not been socialized to be self-regulating or self-directing. Example:
    http://www.johntaylorgatto.com/chapters/16a.htm
"I'll bring this down to earth. Try to see that an intricately subordinated industrial/commercial system has only limited use for hundreds of millions of self-reliant, resourceful readers and critical thinkers. In an egalitarian, entrepreneurially based economy of confederated families like the one the Amish have or the Mondragon folk in the Basque region of Spain, any number of self-reliant people can be accommodated usefully, but not in a concentrated command-type economy like our own. Where on earth would they fit?"

So, yes, we need to rethink what education means and all sorts of other things. James P. Hogan's novels touch on some of these themes, especially Voyage From Yesteryear. People may need some time to adjust having all their assumptions about the world change.

On money and debt, see the second version of a related film, the YouTube part of the second version (Starting at 2:40) covers some of a rethinking of that:
    http://www.moneyasdebt.net/
    http://www.youtube.com/watch?v=rxo_XPdpI_s
But sure, there are imperatives in the financial system that drive this too, things like tying executive compensation to growth and not sustainability. Some of that can be fixed by mild inflation or demurrage, to keep money moving. But ultimately money is about rationing, and, as Iain Banks said, a sign of poverty.
   

Money isn't currently backed by anything but debt. See this video for a real shocker:

http://www.moneyasdebt.net/