Yes, we certainly knew how to do jargon in those days!
Of course, both propositions are true. Marxists from Karl onwards have agreed that bourgeois democracy is the preferred form of capitalist state. Why? Because under capitalism, economic power is decentralised (private ownership of the means of production) so some kind of inclusive politics is the best method of synthesising overall political policy. If the state achieves the political autonomy of autocracy or dictatorship we have the familiar principal-agent problem. How do we get the state to properly advance the (weighted average of the) interests of the distributed capitalist power-elite? How do we stop the state going off on some crazy project of its own?
The Nazis in Germany are the usual case study, and my analysis above broadly paraphrases Trotsky's writings about the rise of fascism there.
The democratic government is distinguished from its dictatorial cousins by its unwillingness to decisively back one faction of society over everyone else, even if such a focussed policy is objectively necessary to break some social logjam. "We all know what has to be done; it's just that none of us knows how to be re-elected afterwards."
Bourgeois democracy is like pacifism - it's an unstable equilibrium requiring all sides to show restraint and be prepared to accept being overruled. It's when a significant social force won't accept compromise and sticks to its guns come what may that you get the logjam. The inclusive speech of liberal politicians becomes strained and ineffectual - weak hand-wringing and appeasement. The logjam-party takes heart while ordinary folk begin to despair. Oppositional parties calling for effective action begin to gain traction, parties which don't much care about discredited 'democratic' ideals. What if we're rather blasé about being re-elected afterwards, anyway - or we believe that subsequent 'facts on the ground' will make all the difference, come the day?
Returning to the party-of-the-logjam, there's nothing like a sharply defined and highly-deprecated religious identity to underpin a hard-nosed refusal to compromise under any circumstances: 'our martyred dead' and so forth. You can see where this is going: bourgeois democracy can handle small to medium logjams by uniting the majority and deploying state force against the obstructionist, unyielding minority and winning - Margaret Thatcher is the textbook example. But if the logjam gets too big and/or intractable, you slide into civil war (cf Libya) and the democratic state is swept aside and is transformed, or collapses.
None of these drastic things will be happening in Western Europe any time soon; we're at the very start of a long, tortuous and only semi-slippery slope. However, to mix metaphors, when your problem is currently a small but extremely intractable hole, it's surely time to stop digging?
