It is not so much that capitalism leads to an epidemic of mental illness, it is more that there are many conditions, many people that are so incompatible with capitalism that making them comply will cause the system to lose any human face. We are categorized as sick, because else the system would have to be categorized as such.

And it gets even worse if you try playing the game, and accept the system, as identifying yourself with your “success” and the idea that your worth derives only from what you produce causes so much stress, that it can break your psyche.

Not a psychologist, but I see this happening all the time:

1. People start to derive their self-esteem from their job.
2. They put so much effort into being better at it, as it is the only way for them to feel better that their burn out.
3. Later, they start losing some of their capability (either from burning out or from just getting old), and their entire ego is broken, as a result.