I don't think capitalism itself is the problem. Capitalism is basically just a policy of individual freedom extended to control of production, which honestly is hard to argue with. The main problem in my mind is that as a culture we've bought into the mistaken notion that more goods and services mean more happiness. Of course, this notion is primarily the result of the capitalist propaganda machine we call advertising. If we restricted advertising it would do a lot to tame the beast. Another problem is that we've walled everything off, so if you want to live you need to play the capitalist game. People should be able to opt out if they want.

That being said, while I'm mostly pro-capitalism, I'm also in favor of income redistribution. Happiness from wealth has hardcore diminishing returns, and visible inequality directly creates unhappiness. Based on these facts, significant income redistribution is really a moral imperative.