Westminster is not on the Acropolis
If we put back in its place, i.e. in history, this reality commonly called democracy, we realize how poorly the word is adapted to what it has labelled for a couple of centuries.
Modern times have given an utterly new usage to a notion born in Ancient Greece. Nowadays, the man in the street, the academic or the political activist, everyone uses the word democracy for 5th century B.C. Athens and 21st A.D. century Italy or Sweden. The people who would never dare talk about a prehistoric "economy" or "work" among New Guinea tribesmen see no anachronism in applying the same term to a system where citizenship meant an ability (theoretical but also partly effective) to govern and be governed, and to a system nowadays where, for 99% of the citizens, citizenship comes down to the right to be represented.
This gap was more readily admitted in the early days. James Madison, one of the founding fathers of the US Constitution, differentiated between democracy, where "the people meet and exercise their government in person", and republic (a term of Roman and not Greek origin), where "they assemble and administer it by their representatives and agents". With the passing of time and the rise of the modern bureaucratic State (which Madison opposed), democracy has become a mere synonym for power vested in the people but not exercised by them.
Common wisdom bemoans the limits of a Greek democracy closed to women, slaves and foreigners, and rejoices over the opening of modern democracy to larger and larger sections of the population. The ideal of radical democrats is a demos that would welcome all human beings living on a given territory. They forget that the Ancient Athenian fortunate enough to enjoy citizenship was not a citizen because he was a human being, but because he happened to be a co-owner of the polis : he was a landowner, small or big. The democratic system emerged as a way to manage as smoothly as possible the contradictions within a community of male family heads, inexorably divided by an increasingly unequal distribution of fortune.
It's only because it was limited to a group that shared something vital (a superior social position, albeit undermined by money differences) that Greek democracy could afford to be participatory (which did not save it from periodic crises). In Europe or the US today, nothing can be compared to the demos of Pericles' time. When it's applied to societies ruled by the capital-labour relationship, the word "democracy" tells us more about what these societies think of themselves than about their reality.