Just as in any economic system, capitalism is one that must balance the scarcity of resources about the wants of those resources, or the Law of Supply and Demand. Although the demands of humans (consumers) are limitless, resources do have limits as to how long they will be available for consumption. The purpose of the economic system in place must allocate the resources, which have variable usage, to satisfy the wants of human consumers. However, capitalism is not only seen as an economic system but as a social system and governmental system as well. To understand one, it is important to have a basis for all implementations of capitalism. The purpose of this paper is to discuss the principles and practices of capitalism or laissez-faire capitalism as an economic system, as well as to compare the two largest, most advanced and successful systems of capitalism in the World, that of Germany and the United States of America. While capitalism as a whole has certain fundamental similarities, there are differences that reside in the two systems, most undoubtedly due to the differences in culture of the two countries. The differences, similarities, positives, and negatives of capitalism will be discussed, as well as the effects that capitalism brings to a group of consumers in a democratic society. First, the theories of capitalism will be discussed and then how those theories are applied in actuality in the two countries. Then, the fundamentals of each country's system of capitalism will be presented and compared. Finally, the effects of government intervention in each scenario will be presented.
             Laissez-faire capitalism is complete separation of the economy and the state (government), similar to the separation of church and state, as in the United States. Capitalism, as a social system, is based upon the private ownership of resources which involves complete uncontrolled and unregulated economy by governmental entities, where all land is ...