Actually, I think they are compatible…but in a VERY specific way. I believe that government should provide all basic necessities to people, such as food, shelter, healthcare, transport, gasoline, and so forth. Capitalism can be used for luxury items, such as fashionable clothing, bigger houses, flavored toothpaste, singing bass decorations, ect. In this way, money is used for lifestyle, rather than being a requirement for survival.

This effectively allows people to strike or protest at will, since the coercive power of government and corporations is much reduced. We get to keep the efficiency of capitalism, while keeping it from metastasizing into a cancer.