: The capitalist looks around for a need that is not being met
SDF: "Need" is irrelevant propaganda -- the capitalist looks for money to separate from its owners. That's the essence of effective demand, it's the total amount of money that a product will fetch, price times the number of consumers able to pay it. "Need" is not effective demand. Haven't you been paying attention to the debate around here? Homeless people may need vans to live in, but no capitalist is going to make a living selling vans to the homeless.
: As capitalist societies become more developed, the earning power of the capitalist workforce must naturally rise,
SDF: In reality, nobody's earning power "naturally" rises -- please see Barry's response -- the working class has had to fight for its meager benefits every step of the way, mostly through union organizing. When the working class has "joined capitalism" in trying to earn more, this results in phenomena such as the Panic of 1837 and the Depression of 1929-1932, so some relief from capitalism is necessary, preferably socialism. As you said above, every capitalist will pay as little as possible for labor.
: if for no other reason than to provide a market for all that productivity (a resolution to Marx's "shrinking markets"; even Henry Ford picked up on this).
SDF: Ford paid his employees extra so that they would be willing to work in a Taylorized workplace, where they would have to do the extra work of having their bodily movements monitored and re-positioned by experts on "management science," thus eliminating "goldbricking" -- goofing off on the job. He didn't do it because he was a nice guy.