I don't think this thought experiment is appropriate. On it's face you can use it to justify the status quo more or less at any time in the world. It's not a strong argument against the position that improvement is slow or stagnant.

Beyond that, no one believes that material wealth is fully useless. But we know that material wealth is not useful beyond a certain baseline to one's happiness, except as a means for the exertion of power. The hedonistic treadmill is inexorable.

If I could live in a world free of rent seeking and social domination with the equivalent of ~40k/year in material product each year, I would do it. Most of the reason most people work beyond that is to acquire fundamentally scarce goods such as housing ans land for which capitalism won't make the pie grow, is due to artifical demand brought forth by marketing, or simply doesn't actually benefit to individual happiness.

We already have fairly conclusive research on this, once you have enough money to be insulated against catastrophy and acquire stable living conditions as well as a sufficient social status, the marginal effect of increased income on your happiness is roughly zero.

Which is, by the way, not the opinion of the Soviet ideology, they were fairly committed to growth for a prolonged amount of time, though their economic system did not necessitate it to survive (geopolitically it was necessary for military reasons though)