Well, sure, Communism as a theory has its flaws, although those lie mostly in the later part of the theoretical system. But capitalism has its flaws also. The biggest flaws in both theories are that they underestimate human nature and the influence "compensatory elements" like money or property have on human nature (I think Rousseau, one of the founders of modern democratic theory, was it that stated, that the first time a man stuck a pole in the ground and said "this ground is from now on my property" was the fall of mankind). That's why capitalism needs a certain degree of government regulation. But capitalism is the model that shows so far the best compatibility with democracy. Most historians and political scientists are of the opinion, that there is no system better suited to go along with democracy.
In my opinion, the best model is that of "Soziale Marktwirtschaft" (social market economy) like in Germany or some Scandinavian countries, where the goal of captalism is not just to enrich the individual with the most "entrepreneurial spirit" but to further the wealth of the community as well. Some countries even move a step further and are currently developing a system called "eco-social market economy", where the protection of the environment is becoming a pillar of the capitalistic system. Germany and Japan are doing this with great success by creating tens of thousands new jobs and a huge economy (renewable energy, more conscious and healthy food, making cities more "green", protecting endangered species etc.) in that area.
In conclusion I'd say that captalism surely is a system that can generate a lot of inequality, precarious living and working situations and frustration, but it also gives more opportunities to strive, to prosper and to pursue happiness than most other systems, if implemented with caution and care. For a (post)modern democracy, eco-social market economy is the way to go.
