It does seem as thought ere are a number of industries that are pretty much mature, and there is little that capitalism can do to improve them.
The benefit of capitalism is that it encouraged innovation and entrepreneurship to fill in niches of consumer needs and wants without any need for direction from a higher power or authority. Someone sees a need, and profits off of filling that need.
The problem with this, is that when an industry has become mature, and there really is nothing more that can be done with it, capitalism starts o fail. Investors want to see not only a profit, but an increasing profit, competition prevents unilateral price increases, and the maturity of the industry means that there is little or no room to innovate in ways to decrease costs or increase value of the product.
If the government invested into these industries, and ran them in such a way as to simply break even, not requiring a profit motive, they would quickly outcompete the private industry in the same market. This would provide more plentiful higher quality goods at a lower price than a mature industry can under capitalism. Remember, in free market economics, profit is defined as an inefficiency in the system, not needing to return increasing profits to investors would allow publicly run industries to operate much more efficiently.
There is no need to abolish or outlaw private industry in the sectors the government represents. Private industry will not be able to compete in those sectors. If an innovator comes up with a better method, they could set up their own and compete then. If an innovator comes up with niche variations that the govt does not produce, they can make a profit off of serving that niche. Overall, though, most of the products and services from mature industries can be provided by public enterprise more efficiently than by private.
If the govt is able to provide the goods and services that come from mature industries, then the govt is capable of providing for its citizen’s needs. The public sector can cover all of the basic necessities of life and survival with ease, leaving the private sector to cover the more nebulous and extensive wants of humans.
In my mind, the govt should provide the following necessities.
Food: This one is actually really easy. People need about 2000 calories of nutritious food a day. We know pretty precisely what the base needs for food consumption are for any population. We may not know how many will want a lobster dinner or caviar, and that is what the private sector can pick up.
Clothing: Well, clothing is cheap, really. I cannot see how it would be difficult at all to ensure that everyone has appropriate clothing to avoid exposure to the elements. Private sectors can play with name brands and fashion.
Shelter: This one is a bit of a tougher one to get the govt in on, as where people live is a personal thing, and it is always unpredictable exactly how things will play out if you gather people together into one area. Ultimately though, people need one roof over their head, and that should not be all that hard to provide, there is plenty of land in this country, and there are plenty of building materials.
Transportation: The govt should get more involved in the transportation sector. Building or bulking up mass transit, but it should also get into the business of making cars. Cheap, reliable but no-frills cars that can be nearly given away to those who need them because the mass transit s not sufficient.
Education: Not only should the govt be providing k-12 as a public education, but it should also be providing the secondary education that nearly all good paying jobs require. Along with this should be massive reforms in the methods of teaching and assessing student’s aptitude, as well as making all the educational materials that are used in public school part of the public domain, so that everyone has access to them.
If the govt took up about a third market share in most of the larger industries that are pretty much mature, then that would create a better situation for stability of that industry, its employees, and its products.