An economic and political system whereby the means of trade and commerce is controlled by private individuals and companies conducting trade and commerce on a voluntary basis with the goal of bringing profits to those involved. 

Ideally, this system is not influenced by government entities or restrictions other than respect for other people and their property.

The natural laws of supply and demand through competition play an important role in capitalism. The more competition there is in an industry, the harder it is to profit. The amount of supply and demand of a product or service will help to determine its price and value to individuals.

It is important to understand that western countries do not have true capitalism. The system practiced in the west today would be considered a mixed economy, where capitalism is heavily influenced by the state in regards to taxation, regulations and central economic planning.

We currently have aspects of capitalism, however when the state removes a large portion of a person or companies profits through coercive taxation and also controls the price of money through central banking and sets arbitrary restrictions on people or businesses the ideals of voluntary exchanges become perverted.

Ideally, a person could trade any form of currency they want with another person so long as both parties voluntarily agree to the deal without fear of any portion of that trade being stolen from them through the taxation.

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Those who nourish the hope that it will be possible to keep central government free of the corrupting tendencies of power and to staff it with a freedom-loving elite, overestimate the virtues of both the electorate and the elected, and underestimate the normative power of structural processes even over well-intended functionaries.

- Robert Nef