That's a weird take, meaningful fines are rare, except for parking/speeding tickets (because it's an easy way for cities to get cash), prison is very rare, you have to really go for the large crimes to not get probation. The one exception is coercive detention ("Beugehaft"), which they hand out instead of fines. It's a dumb concept, but it's also not that common.
I also generally disagree that Germany is capitalist. Most markets are heavily regulated and full of subsidies, taxes are extremely high, and there's a fundamental mistrust of individualism.
Fines are neither extrajudicial nor cruel and unusual. It's in everyone's interest for you to pay a fine if you don't file your taxes than for you to receive a prison sentence.
Again, it's rare. The state is financed via very high taxes in Germany, not by abusing fines as a money grab. Some local admins get overzealous with speeding + parking violations, but even that is pretty cheap. And what's the alternative? Would you prefer your car to be towed and your license invalidated? Paying 20€ is cheaper for everyone involved ... and if you're really allergic to paying money and the picture isn't perfect, you can usually get out of it by claiming "that person could be anyone".
I also generally disagree that Germany is capitalist. Most markets are heavily regulated and full of subsidies, taxes are extremely high, and there's a fundamental mistrust of individualism.