"What's so great about the work ethic?" Mark Kleiman, a professor of policy studies at UCLA, asks on his blog. Maybe Germans, who apparently work about 70% as many hours per capita as Americans, have it figured out better than Americans?
An increase in income tends to make someone happier, and a decrease to make someone less happy. Being higher in the income distribution is correlated with being happier. But over time, as whole countries get richer they don't get noticeably happier (once they're at a level above about half of current US GDP/capita), and the correlation between average income and average happiness across countries (again, omitting those who are actually poor) is close to zero.
Kleiman's post throws some interesting questions out there and is worth a look. I actually stumbled upon it reading Joe's Dartblog, where you can find a funny jingoistic nonsequitur response fitting right into the exact ratrace capitalist logic being questioned: We Americans work harder because we're "perennially hungry" to "stay on top."