Socialism and Capatalism both work best when working together.
Capatalism should exist to give people freedom of choice and opportunity for advancement and improvement but it does need to be curbed by regulation to prevent it getting out of control - whether that is preventing direct advertising to children of certain products or anti-trust legislation to prevent unfair practices (Microsoft, the recent price fixing cases amongst cigarette companies etc).
More also needs to be done to encourage development where there is little will within the corporations but a strong social arguement. We would have and should have had green transport options which are both cleaner and cheaper for the consumer years ago, but because oil is more profitable, the will was never there to develop the technology. It is only recently, mostly through clean air legislation and dissatisfaction over rising oil prices that companies have finally got their arses into gear in developing the technology or rather implementing it.
It needs to be remembered that capatalism is not always good for the consumers, but is always good for the shareholders.
Socialism needs to exist to help those who are unable to benefit from Capatalist opportunities for whatever reason whether that be due to age, ill-health or job loss when capatalism goes wrong. Rather than socialism a better term is perhaps social justice.
The best thing to ever happen to this country was the implementation of the Beveridge report in the 1940's which tackled the five giant problems (Want, Disease, Squalor, Ignorance, Idleness).
It would take the richest and most mercenary of capatalists not to think the provision of state education, free health care, social housing and benefits for those truly in need were not important and worth safeguarding.
It is true that it could be done better and cheaper, it is also true that the 'benefit net' is perhaps cast too widely at the moment, but the concept of their exitence is sound, even if their implementation needs work.
Labour, or more specifically socialism is not to blame for them mess we are in now - capitalism and the greed of the banks is. America had been a right wing, capatalist country for 8 years before the banking crisis and they were as hard hit as we were in terms of job losses and ensuing poverty.
The difference is in this country, a poor family that have lost their income due to the banking crisis do not have to choose between essential medication for their sick child and feeding the rest of the family.
While I am glad of every opportunity afforded to me through capatalism, I am also glad that I live in a society that at least makes an attempt to take care of its young, sick and poor.
The best societies are the ones where capatalism and socialism work together to achieve equality of opportunity while providing a saftey net for those who need it. I believe Britain works like this - and we do it relatively well - even if we still have some way to go to perfecting it.