My understanding is that capitalism is a system which allows us, as a society, to produce things very efficiently, and to distribute resources. It hasn’t failed in that role, has it?

When you look at the growing wealth inequality over the past 70 years, it’s pretty easy to argue that it is failing at that role currently.

Overall, capitalism / free market are a powerful decentralized system for resource allocation, but they have a lot of problems that aren’t being addressed.

Externalities like environmental damage aren’t accounted for, anti-competitive behaviour (like Apple’s walled garden) prevent fair competition and resources being allocated to the right spot, same thing goes for advertising and marketing which are by and large exercises in using money to psychologically manipulate people instead of making a better product. When wealth concentration is not reinvested in the product / business for societal betterment but is instead hoarded for personal gain it causes resources to be spent on frivolous rich bullshit (yachts instead of food), and capitalism has no inherent mechanism for caring for the less useful and those unable to work.

Yes it sounds great when you frame it in the context of a business making a better product getting more money, but it sounds a lot more soulless when you’re talking about someone being born a little slow having to live a shit life just because of how their dice were rolled.

Even if you correct for all of these, capitalism falls apart in an information economy. At a very fundamental level, capitalism and trading is based on the idea of things being finite, which mass and material is. If you possess an object, I cannot possess it. But information doesn’t work the same way as matter / energy. Information can be duplicated and replicated instantly, across impossible distances, and our technology to do this has gotten so advanced and global that we can now duplicate any information an infinite numbers of times anywhere around the globe nearly instantly. In this context, capitalism falls apart, because as soon as information is created, there’s no reason for it to be scarce, meaning it has zero value.

In this light we created copyright and patent systems to assign ownership of information, but what these systems really do is create artificial scarcity where there is no need for scarcity, just so that they can fit into a capitalist model. Do you know what would be better for overall useful economic growth? If all companies open sourced all their software. You know what won’t happen because capitalism is the only system we have for assigning resources? That.