It is efficient because it adapts, for example by enlisting the state to help reconcile the supply/demand average with a price that reflects a market from which the world has long since moved on.'inefficient at setting prices for hiring labor"? The market should be the benchmark for setting prices for hiring labor. The market is the most efficient system to date so far, which is why our poor still live far better than the poor in other nations. It is the essence of democracy. People put their money in the places they choose, not where they are told to put it.
It is not, of course, the most efficient, which is why it was the USSR and not the U.S. that went from candlelight to space travel in 2 generations.
The reason the poor in the U.S. live better than the poor in other nations is that such inequality is maintained by means of the well-known imperialist system, because the divide-and-conquer premises of that system are fundamental to capitalism. The super-exploitation of workers in the colonies and semi-colonies, who on average are paid less than the cost of subsistence, allows the ruling class to reap fantastic super-profits. Some of the surplus of the profits are then redirected back to the American workers, who are paid on average more than the cost of subsistence, doled out in quasi-scientific fashion to induce us to turn our backs on our fellow workers and join the camp of the class enemy.