>Oh, they would, just a lot slower.[...]If private industry leaves,[...]

Product patents on drugs in most european states were introduced only about 30 years ago. The pharmaceutical industry seemed to do just fine the 100 years before that.

>Litigation is not the norm.

No, but license fees are. Every industry I know of was kickstarted in an IP free enviroment. Patents were ever only introduced/enforced later because they would smother growth and competition. As you were droning about capitalism, you might want to take look at the opinion of, lets say, Hayek about IP.

>The world isn't black or white

Oh, so one can be a bit pregnant?
You were the one bitching about software patents. Show me a real world example of what you would consider sane "IP" law and then we can go on from there.

>[...]recoup some of their costs[...]

Your original answer was that a copy would make them lose time/effort/money, not that they miscalculated how many people would pay for it.

>Except that everyone has a copy anyway.

And Adobe is still afloat. How does that work?

>How many people do that?[..]Obviously not enough to fund the making of movies or major pieces of software.

A "donation" can take many forms. Buying a copy from the author, for example. Something you do even if you don't have to. Further see >>60. There are whole operating systems that are developed and distributed free of charge.

>Why shouldn't they? That was a condition of purchase.

See >>60. And I really would like to hear what you think about software EULAs.

>How is that a response to my comment regarding capitalism?

You don't consider breathing a fundamental right? In a world where everything is private property, where would you get your oxygen from? (Another hint: see it in the spirit of your answer to >>49)

>Hardly a compelling argument for the elimination of copyright.

http://en.wikipedia.org/wiki/Cui_bono
You were arguing copyright is here because it benefits society, remember?

>That book in your hands? Only one person at a time can have it.

But an unlimited number of persons can draw benefit from it without compensating the author. And in the case of a second hand sale somebody is even making money from the author's work.
Person reads hardcopy, author sees no money. Person reads electronic copy, author sees money. The first one is ok with you, the second one not. Why? (If your answer should boil down to "scale", think twice about that)