This is all sick in it's own way, but it's not capitalism. Why do people equate every system in which someone makes a profit with capitalism?
In the same way that the USSR wasn't communism. Does that matter if it's the result when you don't just deal with spherical humans in a vacuum?
(Technically, it should be called fascism, since it's the binding together (fasces) of government and business in an unholy union.)
But the big people in charge (or at least with connections) forcing the little people to send them resources? That's a pattern far older than the notion of capital investments, and dates back to our early primate days, before our most basic notions of investing in the future through things like, say, agriculture. So I say it's pretty much orthogonal to capitalism.
This sounds like feudalism to me, though I know the word has negative connotations, and is now associated only with the distant past.
The idea that communism or socialism is free from this kind of thing is ridiculous.
Oh, sorry, I was referring to the problems specifically described in the article, not to "the idea of making people pay for their own punishment" in any general sense. I should have been more clear about that, or maybe you should be more careful about setting up straw men.