While various countries have come close, no country can boast of being a purely capitalist or socialist country, not in the purest form anyway. There are aspects of socialism in capitalist countries and there is enough evidence of the price mechanism at work in socialist countries. l do agree with some of the points you make, but the conclusion is overly simplistic.
NO, true power doesn't lie behind the barrel of a gun. This was the thinking behind to race to amass weapons in the 70s and 80s, but going by that the USSR would still be existing. l could go on, but you get the drift.