The Cause of the Crash
The current economic implosion results not from market failures, but government success. Government exists purely to centralize benefits and socialize costs; anything else is pure marketing.
The most effective means of transferring wealth from the productive classes to the plutocrats is inflation. Government is now dealing with the inevitable consequences of long-term inflation. Of course, the only thing they can do about it is what the US is in fact doing: inflate more.
All the bad behavior by Wall Street, the banks, and the other usual suspects was subsidized, hence encouraged, by the US government, whose partners in crime they were. (The US is massively subsidizing such behavior again, under the guise of "stimulus," i.e. direct transfer payments to the rich.)
How much of this is "capitalism" is a matter of semantics. I'm inclined to agree with Kevin Carson's "free-market anti-capitalism" formulation myself.
The collapse certainly has nothing to do with the markets being "too free." They've been manipulated every step of the way. Meanwhile it was the hard money and real free market types (not the neocons and their conjoined equally-evil twins, the neoliberals, passing off their mercantilism-warmed-over as "free markets) who predicted the meltdown all along.
Mainstream economists, who cheer-led the inflationary bubble and predicted it would expand forever, now tout the Bush/Obama Rich-Only Recovery as "green shoots." One wonders how much of this is innocent stupidity, and how much is paid.
The above is a slightly-edited version of a comment I dropped on John Robb's excellent Global Guerrillas blog. Robb is a most insightful and incisive writer on the continuing collapse of centralization. He really is a good guy, convinced he's doing good work - although he seems sadly unable to recognize that what he's really doing is struggling desperately to preserve centralized power for the ruling class by somehow incorporating decentralization into top-down hierarchy.
Fortunately for us all, that's self-contradictory, and thus can't work for any length of time (indeed in the longer term it hastens the very thing it's intended to forestall.) Unfortunately, by adopting some of his suggestions our rulers could inflict substantial additional harm on us. So it's fortunate they won't listen to him.
Ultimately, Robb makes the same mistake as everyone who uses "we" when they mean the United States: he thinks that means all of us, but it really means those who operate the government for their own private interests. Which is everyone involved in running it.
Postscript: if he's bothered reading any of the several comments I've left on his blog, Mr. Robb probably thinks I'm a total lunatic and dangerous. As a nameless North Vietnamese colonel allegedly said to Colonel Harry Summers, "That may be true, but it is also irrelevant."