Is the Economic Crisis an Indictment of Capitalism?

Every time there's a bit of turmoil in the markets, someone at the BBC trots out that question. I veer between being amused that anyone could be so stupid, and annoyed that they could be so lazy. Then again, the PC mindset at the Beeb requires that anyone who works there be able to believe six impossible things before breakfast, so it's no wonder that their poor dear little brains are pickled in a marinade of socialist group-think.

As luck would have it, Ludwig von Mises considered that very question on behalf of the worriers of his day [short answer: no] :-

It is almost universally asserted that the severe economic crisis under which the world presently is suffering has provided proof of the impossibility of retaining the capitalist system. Capitalism, it is thought, has failed; and its place must be taken by a better system, which clearly can be none other than socialism.

That the currently dominant system has failed can hardly be contested. But it is another question whether the system that has failed was the capitalist system or whether, in fact, it is not anticapitalist policy--interventionism, and national and municipal socialism--that is to blame for the catastrophe.

Hat tip to Shawn R at the Foundations of Economics blog, who concludes:

I was struck by how much of what Mises said about the response of many to the Great Depression applies closely to our current situation. Just like Mises, we must never tire of explaining the fallacies in the thinking of those who think the Great Recession is a clear case of the failure of capitalism. In fact, it is a quintessential example of the failures of interventionism to bring about anything other than economic destruction and relative impoverishment.