[andrenth]

But in the contemporary case, there is not enough demand

This is a strong assertion to be made, especially in general like that. There is not enough demand of what, specifically? I agree that current interventionist economic policies are restricting growth, but to conclude from this that "there's not enough demand" is incorrect in my opinion.

machines are beating a large (and ever increasing) proportion of human labour

Just like the cotton-spinning machinery did in the past. We could not compete with it either, and yet the result has been more productivity, hence more jobs, better wages and the ability to support a larger world population.

I think a big part of this misunderstanding comes from the idea that we are competing with the machines when we are in fact making use of them.