I don't know where you get your take on economic theory or history, but the opposition to Roosevelt's New Deal and the legislative restriction on government spending in the States is well known.
My economics would fall into the Austrian School of Economics, which incidentally predicted the Great Depression, the monetary crises since the last ties to gold were abandoned in 1971, the dot com bubble, and the housing bubble including subsequent mess.
There was no opposition to the New Deal, if anything economists and politicians of the time were saying that not enough money was being spent. The only thing that temporarily slowed down FDRs spending (for only two year) were Supreme Court decisions that forbid him to continue certain activities.
The history of war profiteering and subsidizing the economy via Military spending is also well known - America is not behaving like a sovereign state, but a private enterprise with its own private Army.
I agree that America has a huge history of "subsidizing the economy via Military spending", but this does not make the US a private enterprise. The only way military is subsidised in the way that it is by the state taking money out of the economy by force and then handing it to vested interests. There is absolutely no private company that can do that, only an elected government with powers to take by force with threat of imprisonment can do this.
The history of the American depression also seems to blow your Robinson Crusoe test out of the water - having goods to sell doesn't generate a market.
Need and desire generates the market - offering goods at the right price point satisfies demand - the right price point is not necessarily the lowest - ask any Mercedes or Rolex owner.
Actually the Great Depression perfectly matches up with the Crusoe theory. Here are some fact about the Great Depression and the things that FDR did during same to "boost" the economy:
1) he increased taxation reducing the amount of money in the economy
2) he massively spent borrowed money reducing the amount of capital in the economy
3) he then paid farmers to
not produce on all of their land
4) he spent money on "infrastructure" projects, which meant that labour was used to produce stuff that could not be sold
5) he introduced unemployment welfare, which paid people to not produce
6) he forced minimum wage laws on companies and also forced companies to not reduce wages; this resulted in companies hiring less people, resulting in less production
7) unemployment never went below 15% during the 30%
None of this resulted in increased production of marketable goods. The unemployment rate is most damning factor that shows that people's productivity did not increase. And even when unemployment went down it was because of the war draft and arms manufacture, none of these made Americans better off.
Demand in any market is infinite, what is finite is the ability to satisfy demand, and you can only satisfy your demands by earning money to pay for them.
It is also not correct to say that the same forces of supply and demand influence the price of a Rolex and a cheap Chinese plastic watch. In economic terms they are completely different products with completely different demand. Supply and demand can also be completely different from location to location; a pork chop might have a price tag of €1 here, but in Saudi Arabia it will be completely worthless. Supply and demand do not result in the same price being charged everywhere, they influence in differenct ways at different times in different places.