"How did digital photography, which put 140,000 people out of work and, as Yahoo's CEO correctly notes, eliminated the business of professional photography, create more jobs than it eliminated?"

It put 140k involved in the film photography industry out of work. We still have professional photographers (now using digital cameras), and the demand for CCDs and technologies related to digital photography created jobs in the semiconductor industry. The uses of digital photographs for online businesses (like Facebook) has helped to create jobs in that industry. Many people switched to GMail because of the large amount of mail storage it offers, in part because of the space that high-resolution digital images require -- and thus many jobs at Google have resulted. Think of all the people who had to work to expand network capacities, expand storage capacities, and the various services involved with that, to meet the demand of people who send and receive digital photos and videos. A text-only Internet, or an Internet where the only graphics were cartoons, would not have required nearly as much capacity as today's Internet requires, nor would a cell phone network that only carries voice calls or sends text messages.

Digital cameras are not just film camera replacements. A digital camera enables ways of using photos and videos that were substantially harder (or even impossible) with film. You cannot truly believe that something like Youtube would have become popular if people did not have an easy way to record and upload videos. You cannot believe that Facebook would have been a hit if people did not have an easy way to take their own picture.

"How does a shopping website, which eliminates a dozen local small businesses, create more jobs than it eliminates?"

Who packs the site's shipments into boxes and onto trucks? Who builds the site's computers? Who mines the silicon and rare earths used to make those computers? Who maintains the communications systems that enable you to buy things online?

This argument is no different from stage coach drivers who complained about how railroads were killing their business. It is the argument the Luddites made when they smashed industrial equipment.

"I want to believe this is all going to turn out okay, but I'm also watching private companies making record profits and the stock market shooting for the moon while unemployment numbers remain unchanged."

Much like the unemployment of blacksmiths. If people lack the skills needed for this day and age -- if they do not know how to use computers effectively or competitively -- then of course they are going to be unemployed. The unemployment rate for programmers and computer scientists is about one-fifth that of the general population. People need computer programmers, not film photographers or local shop keepers.

Look, I am all for criticizing capitalism, but your criticisms are all wrong. You are complaining about the progress of technology. You are complaining about the fact that I can record a video of the local cops beating up a black guy and within minutes have the rest of the world seeing what I see. Why not instead ask this: why, when new technology doubles the productivity of a single person, do we double our expectations of what that person can do? If one person can do as much as two people, why do we fire half the work force, instead of halving the number of hours we expect people to work? I am not saying this is necessarily a solution, but it is a better question to ask than, "Where did all those Kodak jobs go?"