You've outlined exactly one dimension of why we need it - without it, it's rent-seeking all the way down.
I am concerned that the emerging "Greatest Generation/Silent Generation/Baby Boom used up all the growth and now we're ... messsed up." becomes a self-fullfilling prophecy, aided by the cumulative nature of assets.
I am loath to call rent seekers "capitalists". Perhaps
that's an error, but it make sense to me.
What I've heard others say is that the internal combustion engine, railroad, electricity, the telephone, indoor lighting, assembly line, the airplane were all huge things. Half of those things our grandparents didn't have growing up. The Internet is more recent and has definitely allowed growth, but not quite has much as the others had and other significant things haven't shown up.
We're still growing just not at the scale as we previously had. Also, there could be some new big discovery that could let us return to previous growth...it's hard to anticipate these things.
Now, growth like what America saw post WW2 was definetly a one off thing: the rest of the world was in ruins, and there was great demand for manufactured goods and services from Western Europe and the rest of the world. Today, many more countries are stable and have the infrastructure to manufacture and provide goods and services. So its quite unreasonable to expect that kind of growth anymore in the US.
Where the US has excelled is in innovation and first comer advantage. e.g. Advanced computing systems, electronics manufacturing, automation, advanced weapon systems, space exploration etc. So, as the rest of the world catches up, the US economy moves on to create new markets where they have the first mover advantage. The only way to make this happen is through innovation.
Example: Can you even build a boat out of mahogany any more?
The only things that got bigger - universities, McMansions, and medical centers - appear to be subsidized. Everything else is smaller.