The government should not even try to grow the economy. That's a decision for the market to make. Instead, the government should promote efficiency. With efficiency, overhead costs would decline and the savings would be passed on to consumers. As to what people do with the extra discretionary income, that should be a decision for them to make. If they want to spend it on other things and so grow the economy, that's their choice; but if they choose instead to just work few hours and maintain the same quality of life due to the reduced cost of living, that should be their choice too. Maybe they want to spend more time with family and friends, enjoy life more, or start a new project with the extra free time.
Instead, the government attempts to coerce people into growing the economy by purposely promoting 2% inflation every year so as to punish savers. And then that same government complains about rising household debt. Well, if we adopt a 2%-inflation policy to encourage people to not save, then let's not so hypocritically complain about people indebted themselves when the government actively encourages it.
A stable economy is preferable to a growing economy. If it grows in a stable manner, then that's an added bonus, but it's not up to the government to decide to punish a person who chooses to work fewer hours and live within his means with less money. We're not the government's work machines.
