Go to any third world country that switched to a more capitalistic system and saw their middle class increase. India. China. Colombia. Brazil. NAFTA was great...for Mexico.

I'm no laissez faire capitalism guy. Is consider myself more in line with Nordic socialism but even they have capitalist systems.

Saying the free market never solved anything is pretty ignorant. The reason the first world is considered the first world is because of their ability to distribute wealth using a combination of capitalism and social services. It generally improves the lives of everyone by bringing costs down and individual wealth up. Even Noam Chomsky wouldn't argue against that.

The danger with pure capitalism is that it allows people to fall through the cracks. That's the problem most people have with capitalism, the lack of safety nets and ability of concentration of wealth over generations to corrupt civil law.

Some fun reading regarding ma bell.

http://www.pcworld.com/article/155840/bell_breakup.html

Some quotes:

Telecom analyst Jeff Kagan, agrees that breaking up Ma Bell has led to a tremendous amount of innovation within the wireless world, but says that several telecom firms had to start merging in order to really see the market develop. The reason for this, he says, is that innovation requires a lot of capital that cannot be spent by smaller firms.

"The fact is that other countries didn't break up their telephone companies and they are in the same place today that we are," [Crandall] says. "Whether we could have gotten to this place today without breaking up AT&T is an interesting question, but it's largely irrelevant."

If you're wondering what this has to do with capitalism, money and the opportunity to make more of it drives the innovation that improves our lives. I no longer need a $5,000,000 computer with only a 64kb hard drive to write have this conversation. Instead, I'm using a $150 phone. All because someone thought they could make a short load of money making it. And it wasn't some government organization that said "smart phones? Let's get on that".