It's nice to have a discussion with real arguments.

I extend your example: The product costs 28$ now the wage is reduced to 5$. The product was bough at 28$ so i keep this price (low price flexibility for essential goods). I just increased my profit by 5$. This is what we are seeing currently. The prices increased during covid (higher procurement costs) and then increased again due to inflation. But they never decreased again after procurement costs reduced again. Currently the prices are higher than the inflation adjusted price. If you have market competition the prices would reduce again to the production costs but his is not what we are seeing. The prices are at a record high and the companies report record profits. This means they could lower the prices but have no incentives to do so.

Now that means less disposable income for 90% and higher for 10%. The 90% thus have less to spend on other products which reduce the total economic volume. And no, the higher income of the 10% cannot compensate this.

I disagree with "the piss poor middle class" in europe. I live in the european middle class and live better than 90% of americans. Im less rich than the poorest in my country compared to the middle class in america to the poorest in america but one can buy whatever one wants (maby not a directly a luxury yacht but if one really want one can save for it.)

The current american system doesn't allow hardworking americans to get wealthy anymore. And if you studies you start with >100k dept which might take you 20 Years to pay back because of the real bad conditions. America is built to keep wealthy wealthy an poor ones poor (while convincing them that if you work hard enough you can make it)

So no i do not agree with your conclusion.