Capitalism Values

I feel like I'm the only person whose mind boggles that Apple is the highest valued company in the world (and by a huge margin). Apple is a gadget company.  They make toys.  They do innovate, but not really all that much when compared with the research done by companies in medical (incl. pharma) and energy markets.  At some level they don't even make their products, they just design them; a Chinese factory makes them, and Apple gets all the profit.

Their high valuation comes not because they make great products that enhance human welfare--everything they make is made by other companies, sometimes (often?) better, and almost always cheaper--but because their product market is massive (pretty much everyone on the globe), and they are able to sell those products with much higher profit margins than any of their competitors.  Buying an Apple product is like buying any luxury good: you spend a lot more money for something that isn't measurably better but that has the proper logo on it.  It's arguably worse since many luxury goods are measurably better than the non-luxury alternatives, whether that is nicer materials or better construction, or simply, somehow more (think houses or boats).

This isn't saying Apple is bad (it isn't) or people are stupid (we are but this isn't really a great example), but rather that capitalism values making money, and Apple is better at that than anyone else.

Most other large companies require huge capital investments to get going--oil companies need rigs, labs, land access, mineral rights..., pharma companies need lots of expensive laboratory equipment, as well as plants for scaling up.  Apple doesn't.

In most competitive markets the profit margins of products get driven down--Amazon's margins are sometimes negative.  Apple doesn't reduce its margins to gain advantage.

This should serve as a major indictment of capitalism (similar to the unhealthy profits and values of banks and other financial institutions).  I'm not sure why it doesn't, but I'm suspicious that the people most vocal about the "evils of capitalism" also happen to like and use Apple, and so can't see that the company that makes their computer is very representative of the problem.

It seems that if capitalism best served human welfare, then the largest companies would be the most welfare enhancing.  But the most welfare enhancing aspects of [most] societies are actually government run: health care, infrastructure (water, power, transportation), and social welfare programs (anti-poverty, unemployment, retirement) all contribute massively to increasing human welfare, but they are government operated precisely because they are not profitable enterprises which means capitalism wants nothing to do with them.

In reality it is neither capitalism nor socialism but some melding of the two that best serve society, but still, Apple's valuation is mind boggling.

10/28/2015 Update: Looks like Vox is following my blog.  Of course they come off more like fans than seeing this as an strange byproduct of the values of capitalism.