Capitalism equally seems good on paper, but in reality there are many problems associated with it.
As with any form of bigotry (such as racism, sexism, homophobia), there are advantages to being in the priveleged class that give those an unequal boost at life.
There are many that work longer and harder and receive barely enough to sustain themselves. Look at the use of foodstamps in the USA. How is that anyone working full time should need to rely on govt subsidies to survive?
The Magna Carta, created in 1215, was an important step in creating freedom for the serfs of England. The basic truth in equality of birth has not changed.
The very idea of personal freedom is threatened by both capitalism AND socialism as we know it. There is no freedom when some people are "more equal than others".
Why do you have to tie racism sexism and homophobia with a system? It has nothing to do with it, that just how humans are.
Gay people were stoned to death 5000 year ago, far before capitalism existed. Women were heavily discriminated, and definitely colored people too.
This shit goes on for tens of thousands of years, while capitalism is only about 200-300 years old.
This is human behaviour, nothing more. And it will be the same in socialism too.
So what you want to send homophobes to gulags? Will that be better solution?