The term “social democracy” is very deceiving nowadays since it does not pertain anymore to the roots of the ideology which has changed quite drastically in the last century.

The original premise was that socialism could be achieved through reform and not revolution (hence it parted ways with the Marxist position). That is, the State's institutions were suitable enough to “eventually” or “some day” lead to a socialist mode of production, and so cooperation with the state and, by extension, the bourgeoisie were incremental for socialism. This is why socdem parties were firm believers that change comes from the parliamentary electoral structure (Esson, 2022). I am not going to argue why this is problematic—Marx and Engels have said enough regarding this.

However, social democracy as we know it in the modern age is vastly different from what it used to be. The ideology in the 70's has become attached to the Third Way and socdem parties throughout the world gradually adopted neoliberal policies, pressured by electoral competition. And the Scandinavian countries, home of social democracy, are an exemplary case to this. Just compare their parties' agenda before and after WW2 and you will see what I am talking about.

To refer to “social democracy” as anything less than capitalism would be factually fallacious.