That, at least, is a fair argument. The argument (fallacious as I believe it is) that the FDIC and Federal Reserve create a system in which deregulation of part would be harmful, even while deregulation of the whole would be beneficial, is valid.

Glad we agree on something. I think you should think further about the Federal Reserve. So long as there is a federal reserve, we will always be an entire world away from real capitalism. Market interest rates are the price of money. Money pervades every nook and cranny of our economy and is a cornerstone of every transaction. The idea that we can fix and manipulate interest rates and ever have a healthy, stable economy is what people like Ron Paul believe is the most grievous of our misunderstandings. As he likes to point out, nearly ALL economists agree that price and wage controls don't work and lead to dysfunctional markets (see: communism), and yet all the mainstream economists don't see a problem with controls on interest rates.

your argument becomes untestable

It's not untestable. It's just that we're unlikely to ever have a civilization willing to test it. Having said that, we've had periods in American history that come pretty close. Also, look at places like Hong Kong as pretty good examples of what laissez faire capitalism looks like.

That's certainly an interesting claim. Of course, we can look at what was wrought of a system without the federal reserve, FDIC, or banking regulations. It was about a century ago.

We can, and should. It was not perfect but it was not the constant boom-bust-crash cycle that we have had over the past century.

If we take for granted that without the wholesale dismantling of the regulatory systems in America, no deregulation can prove the harm of pure capitalism, the corollary must be true: that it cannot prove the good of pure capitalism either.

As alluded to earlier, we've had decent evidence that nearly-pure capitalism can work.

Also, I can make a different proposition. Instead of measuring in terms of regulation vs. deregulation, think in terms of interference vs. non-interference.

So the crux of my previous argument is basically that, if you have a regulation that allows (indeed, requires) the big banks to essentially interfere with every transaction by manipulating the price of money (which influences where money goes, which influences what goods and services exists, which influences what people buy and what jobs they get, etc, etc), that's a net negative. If you legalize highly-leveraged fractional reserve lending, and then insure everyone's bank accounts so they don't feel a need to inquire what their banks are doing with their money, you've interfered with the natural process, which would have been for people to be leery about putting their money in low-or-no-yield accounts to be gambled with by the banks and potentially lost.

If you then pass laws that remove interference on how the banks can lend out that money, that's not really removing an interference, it's amplifying the original interference. Or rather, you've removed interference on the banks but vastly increased interference on everyone else in the market. When the banks make riskier loans as a result, the Federal Reserve will print more money to stabilize the banks, which increases the interference on the price of money, which hurts everybody else.

So, if you want a sliding scale that's fair to use, look at interference vs. non-interference. My original point is that not all de-regulation amounts to reduction in interference, in fact it's very frequently the exact opposite. But I don't think it's necessary for us to say "only pure capitalism can prove or disprove the efficacy of capitalism."

People, trading freely and openly amongst each other on an individual basis, en masse, that is the best protection against economic problems. The whole premise of capitalism is mutually beneficial trade. The further removed and invisible something is from those doing the actual trading, the more likely the trade will not be mutually-beneficial (but the parties won't realize this). That's why it's detrimental for you and I to make a trade involving a currency that others are manipulating far away from us. That's why it's detrimental for a health insurance company and the government to be creating so much complication and indirection in a medical transaction that the doctor and patient don't dare try to even have a down-to-earth conversation about the cost of various treatments and what's in the patient's long-term interest. Etc, etc.

Less-obstructed capitalism will result in lower prices, higher quality, increased stability, increased employment, increased prosperity. More obstruction will do the opposite.

That's my point, more simply stated.