Modern social democracy deviates from socialism, which in the traditional sense aims to transcend the capitalist system in its entirety, and is unlike socialism in the Marxist sense, which is to supersede capitalism through a proletarian revolution  . Instead the goal of social democracy is to reform capitalism through parliamentary and democratic processes in order to achieve a welfare state, government regulation of the market, and various state sponsored programs to ameliorate and remove the inequities and injustices inflicted by the capitalist market system. Social democrats do not aim to replace the fundamental aspects of capitalism; private-ownership of the means of production, the system of wage-labor and commodity production; instead social democrats advocate capitalist mixed economies, such as Third way positions and the social market economy. The term itself is also used to refer to the particular kind of society that social democrats advocate.
Historically, classic social democracy was a socialist movement that advocated the establishment of a socialist economy in the strict sense through political reforms, which were to be achieved by class struggle. In the early 20th century, however, a number of socialist parties rejected revolution and other traditional ideas of Marxism such as class struggle, and went on to take more moderate positions. These moderate positions included a belief that reformism was a desirable way to achieve socialism. However, modern social democracy has deviated from socialism, now championing the idea of a democratic welfare state which incorporates elements of both socialism and capitalism. Social democrats aim to reform capitalism democratically through state regulation and the creation of programs to counteract or remove the social injustice and inefficiencies they see as inherent in capitalism, such as Bolsa Família and Opportunity NYC. A product of this effort has been the modern democratic welfare state. This approach significantly differs from traditional socialism, which aims to replace the capitalist system entirely with a new economic system characterized by either state or direct worker ownership of the means of production.
In many countries, social democrats continue to exist alongside democratic socialists, who stand to the left of them on the political spectrum. The two movements sometimes operate within the same political party, such as the Brazilian Workers' Party and the Socialist Party of France. In recent years, several social democratic parties (in particular, the British Labour Party) have embraced more centrist, Third Way policy positions. This development has generated considerable controversy.
The Socialist International (SI) is the main international organization of social democratic and moderate socialist parties. It affirms the following principles: first, freedom—not only individual liberties, but also freedom from discrimination and freedom from dependence on either the owners of the means of production or the holders of abusive political power; second, equality and social justice—not only before the law but also economic and socio-cultural equality as well, and equal opportunities for all including those with physical, mental, or social disabilities; and, third, solidarity—unity and a sense of compassion for the victims of injustice and inequality. These ideals are described in further detail in the SI's Declaration of Principles.