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Theocracy is a state where the country and its people are ruled by a group of people who are believed to be guided by the almighty. Thus it implies that in a theoretical state the ruling body is chosen on religious basis. Democracy is however a completely different scenario. In a democratic state the governing body is chosen by a system of elections.  

However it is not so difficult to conclude that with the examples of theocratic countries such as Iran, theocracy as compared to democracy is not a very progressive form of government. It tends to curtail basic human rights and can be misleading in the name of religion. It has its advantages as well but they are few and there is no real positive effect.

Theocracy is a form of government in which a state is understood as governed by immediate divine guidance especially a state ruled by clergy, or by officials who are regarded as divinely guided.[1]

Israel operates under a parliamentary system as a democratic republic with universal suffrage.[10] However, Israel is frequently described as being a theocratic state.[11] Since Israel was founded by the Zionist movement as a Jewish state, and Judaism as a religion is often conflated Judaism as a nationality,[11] Israel can have the semblance of guiding theocratic principles in its government. Mitchell Bard writes:[11]

My long experience with human nature - I'm 80 years old now - suggests that it is possible that fascism, not democracy, is the natural state.

promotion of human rights and the protection of national security as in inherent tension

President Bush’s 2002 U.S. National Security Strategy speaks of a “commitment to protecting basic human rights.” In the same document, President Bush makes it clear that “defending our Nation against its enemies is the first and fundamental commitment of the Federal Government.”

unnecessary and strategically questionable. A more effective U.S. foreign policy would view human rights and national security as correlated and complementary goals.

Applied fully, the Shariah is a code for living that Muslims should adhere to, including prayers, fasting and donations to the poor. Shariah is the totality of religious, political, social, domestic and private life. Shariah is primarily meant for all Muslims, but applies to a certain extent also for people living inside a Muslim society.