You're picking apart my example of a luxury, not the argument. People aren't forced to spend money on iPhones. If they spend money of iPhones that they need for food they otherwise couldn't afford, then that's their problem, not the world's. Substitute 'iPhones' for any other luxury item. Plus, the agriculture industry is highly regulated, while the cell phone industry is relatively free, which I think has a strong impact on this price discrepancy.

My point is that capitalism allows a significant majority of people to have the basic necessities of life taken care of in exchange for some other contribution to the world.