Ok, so loosecannon has been telling me in the lumber thread about how evil capitalism is and how he (she?) can prove that capitalism is a deeply flawed system that does nothing but harm, so I'm calling him out. I don't want a large string of opinion or anecdotes, either. I want links. I want reputable sources. I want people with econ degrees. I'd also like you to show me one non-capitalistic society that has a better standard of living for the average poor person than the United States of America.

I'll start off:

Capitalism is an economic principle. Economics is the study of how limited resources are used to satisfy unlimited wants. The two main components of how to do this are production and consumption, also known as supply and demand. The ultimate goal of any economic system is to change supply and demand to a level where all production is consumed, with none left wanting. To this end, there are two basic systems.

Socialism: Socialism is based on the power of the state. Under socialism, production and consumption are both controlled by force of law. Individuals must produce certain resources at a certain level to avoid penalization by law. Once the resources are produced, the state determines their distribution based on percieved need. Consumption, in this way, is also controlled by force of law. To consume more than what is assigned by the state also bring penalization under the law.

Capitalism: Capitalism is based on the powr of the individual. Under capitalism, production and consumption are both controlled by individuals. Each individual produces whatever he/she wants to, then barters that production with others for needed commodities (money is just a very simple barter system that introduces a universal trade medium). Production is increased because greater productions means that the producers will have more goods to barter, and thus, more commodities once barter is complete. Consumption is curtailed by the fact that something must be given up to gain access to those resources one wishes to consume.

Pros and Cons (these can be found in most economic textbooks. I will provide links to any pro or con contested by anyone).

Socialism pros:
100% employment: With everyone assigned a job by the state, no person is unemployed.
Few homeless: With everyone granted resources by the state based on need, anybody without food or shelter is without purely by choice, unless the state has expelled that person from the system.

Socialism cons:
Increased government control: Not all may consider this a con, but socialism grants control of almost everything in the country to the state, putting all citizens at the ultimate mercy of what is typically a bureaucratic monolith.
Decrease in quality: Knowing that their allotment of resources will remain constant, only the morally righteous will even attempt to create quality work.
Constant shortages: With no immediate incentive to produce surplus and no penalty for drawing your full allotment of resources, whether you need it or not, socialism causes mass shortages as seen in the Soviet economic system and in states with socialized health care.
Constantly low living conditions: In socialist societies, all individuals not priviledged by the state live in modest conditions, and have no way to better their station other than to endear themselves to those in power in the government.

Capitalism pros:
Individual power: With both production and consumption being controlled by individuals, a great deal of power is given to the individual, rather than the state.
Increase in quality and innovation: Since capitalistic producers must convince others to consume their products, capitalistic producers must constantly improve their products to keep up with their competitors or their businesses will lose money to those who have better ideas.
Self-Imposed triage: Since evey acquisition of resources requires the expenditure of other resources, consumers in a capitalistic society will rarely take more of something than they are capable of using. High prices during shortages means only those who need the resource bad enough to pay the higher price will get them.
Constant opportunity for improvement: Those who increase their production or the value of their production may constantly raise their standard of living. No person living in poverty is doomed by the state to stay there.

Capitalism cons:
Slipping through cracks: With individual production required to gain resources, individuals who do not produce, are only granted resources by the kindness of strangers. An unfortunate few end up homeless and starving, though in a capitalistic society, this is almost exclusively due to the decisions of those people. Only the presense of voluntary charity can alleviate this and maintain capitalism.
When competition goes too far: Some companies will resort to illegal means to increase production. Only through intervention of the state or escalation by other companies can curtail this.

Given those, I would prefer capitalism. If there's another system that is vastly different from these two, feel free to chime in.