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Based on this, I think this is a regional issue. In the US, liberal means left of center.
Here is an example of regional differences.
Here is a wiki page called Liberalism in The United States that also provides a nice summary in the first section.
I would say Bernie is democratic socialist. I would call myself a social democrat, so slightly to the right of Bernie, but slightly to the left of a liberal. I would also say liberals are to the left of moderates who are to the left of conservatives/neo-liberals who are to the left of fascists.
The US Overton window is way to far to the right though.
That's fine, just understand that you're using a US-centric framework that differs from what socialists mean when they say "libs". From our perspective, if you're pro-western-capitalism (and thus pro-neoliberalism) you're a lib. Democrats, Republicans, doesn't matter.
I am a social democrat which is a part of the socialist family as far as I'm concerned. As far as I'm aware, the US-centric framework is what everyone, including socialists, use in the US. Just as socialists else where, such as the UK or EU, use their own meaning for the word liberal.
Based on what you are saying, this particular instance of disagreement does not seem to be a regional one. As regional differences on definitions should translate and be something we both navigate around. What you are describing seems to a disagreement based on definition.
Conflating supporting some form of capitalism, in my case regulated capitalism, ie mixed economy, with neo-liberalism is intellectual dishonesty. You calling me a lib for supporting some form of capitalism is no different than me calling you a tanky for simply being anti-capitalist. Just because you seem to be against capitalism does not make you an authoritarian communist.
Democrats are not currently fascists, so that does matter. I'm registered independent though, so I'm not particularly interested in defending Democrats. If Democrats don't become more progressive, as they are predominately neo-liberals right now, they could easily go the way of the Republican party and become fascist.
Look, I won't argue with you on semantics. You're free to disagree with the common definition of liberalism that socialists use. It's really just a convenient term for people that are pro-capitalist. It's not intended to be a nuanced term, and I doubt most reasonable socialists would directly equate Republican fascists with Democratic progressives, even if they see both as problematic.