"The real world" is also in large part a set of habits and decisions, just like capitalism is simply decisions people make each day, instead of making different decisions. As would be any other mode of relating to one another.
> the "why" is, from the lowest worker to the CEO, "if I don't do my job well I'll be fired, and my family will starve."
That reminded me of two things: a senior nurse responding to her boss saying "you have to X" with "I have to die some day, that's all I have to do" (she was very good at her job too, she just insisted on that being her choice), but also this: http://slatestarcodex.com/2014/07/30/meditations-on-moloch/ While it is about machines mostly, this "inevitability" of a supposedly "external" system you seem to be already describing, and I'm not sure I see a meaningful difference between "work/profit for the sake of work/profit" and this:
Everything the human race has worked for – all of our technology, all of our civilization, all the hopes we invested in our future – might be accidentally handed over to some kind of unfathomable blind idiot alien god that discards all of them, and consciousness itself, in order to participate in some weird fundamental-level mass-energy economy that leads to it disassembling Earth and everything on it for its component atoms.
To me capitalism is far from being "last man standing".. just consider all the PR blurb by corporations and politicians. Sure, there's a lot of appeals to egotism or pure numbers as well, but also to all sorts of fuzzy things that apparently do matter enough to enough people that even the most depraved have to pay at least lip service to them.
> It's like evolution -- the winners keep winning and the losers drop out. Eventually people adopt the winning strategies.
I'm thinking it's also a bit like narcissism and other personality disorders; abuse leads to more abuse. And it becomes a cycle: in a constant state of warfare of all against all, becoming more ruthless is indeed "winning" -- but from another perspective, it might be getting stuck in a very low local optimum. My point being that we have a basically infititely big universe around us, that is infinitely hostile to life and also infinitely loaded with resources and adventures -- an infinite enemy to compete with, if you will, instead of severely crippling our ability as a "team" (and I don't just mean humans) to do so by sniping each other.
Imagine a PvE game with friendly fire turned on -- if a bunch of people decided that it's a Free-For-All deathmatch game and start ganging up and spawn killing, then that's what it'll effectively be. Even in an infinite world, they'd never get far from spawn, or discover the more interesting and refined game mechanics. And then the free beta ends, the servers get shut down -- "thanks for playing, I hope you made the best of it" -- the people who had the biggest pile of loot and skulls in this Lord of the Flies scenario would still think they "won". Yeah, they were vastly richer than most others, but compared to what they missed out on, they are infinitely poor.
While I'm rambling, I would say evolution would not stop even in the most utopian of hippie societies, simply because there are infinite of hostile places to "conquer"... and in the long run, there are no "winning" strategies anyway, everything dies. But if there is no joy along the way, what's the point? Just because there is no "ever after" doesn't mean there can be no "happily". It somehow being preferable to die with the most toys, or being the last one to turn out the light, the very idea of winners and loosers is ALSO a made up story, a narrative, IMHO. We are stuck with giving life meaning anyway, might as well give it meaning that fulfills us in the here and now AND allows us to reach higher heights, instead living in an endless, aimless race where nobody ever feels happy, until they inevitably get knocked out of it, by others or by the heat death of the universe.
Evolution lead among other things to our cognition, to empathy, to cooperation, to joy. These are higher-level functions rather than basic ones. I don't mean to say that makes them "better", because evolution doesn't care either way, but I personally like them lots. And while children for example also test their boundaries, they generally don't seem to "intend" to compete with or exploit their parents or others, they want to learn and be happy and make others happy. That's my impression, which might be worthless, but my impression it is. Some get neglected, some get broken, and those inevitably cannot see more than what they can see, they think everybody else is also empty or hurting inside, and just seeking to exploit others to get ahead - but I would claim (or wishfully think? I grant it may be the latter) that this is rather unhealthy narcissism than "perfectly natural", and rather the result of a limitation or trauma, while conversely having empathy and compassion don't preclude having elbows if need be.. it just means having more options than just elbows.