This is a very typically American point of view, which tends to lump a lot of people together as “liberal” despite this internationally not being the norm at all.

Here’s a definition of liberalism:

Liberalism is a political philosophy and ideology that emphasizes individual rights, liberties, and limited government. It promotes ideas like free markets, free trade, and social equality, while often advocating for a strong emphasis on individual autonomy and civil liberties.

Note specifically how it says individual rights. The idea with liberalism is that if everyone is similarly unrestrained by the government, and has the same civil liberties, there is an even playing field in which individuals can personally grow and excel. This neatly links together with the liberal belief in a free market, free trade, etc…

A strict liberal idealogy will also adopt several progressive policies w.r.t. civil liberties, like gay rights (as this causes social equality -> level playing field for competition). But liberalism is still a strictly capitalist idealogy, with a strong emphasis on the free market and free trade.

Generally, this individualistic approach to rights is considered socially progressive and economically right-wing. And we see that this is the case in most countries around the world, e.g. Australia’s liberal party or the Dutch VVD. The Dutch VVD is a good example to look at here, they are considered very firmly right-wing, but their party platform most closely matches to that of the DNC. In the US, the two major parties are both righg-wing, one is a moderately progressive right-wing party (with some left-wingers in there, but they aren’t very influential w.r.t. party policy because it’s such a small minority) and the other is a conservative/authoritarian right-wing party.

Because both parties sit firmly on the right of the spectrum, they’ve come to distinguish themselves on social policy rather than economic policy. They’ve remapped the progressive-conservative axis on the left-right axis and called it a day. But in most countries, these axes are very much distinct. Here’s the “political compass” for the Netherlands for example:

Note how there are only two fairly fringe parties to the right of the VVD. Also it’s interesting to note here that the PVV (the “far-right” party with the bird symbol near the bottom) isn’t even all that far right. Their economic policies aren’t actually all that focused on free market dynamics, and they do promote certain social policies. But their hardline immigration stance pushes them very firmly in the conservative camp. And although there’s certainly a correlation between left-progressive and right-conservative, there are still major differences between the parties along this diagonal axis.

Generally, actual left-wing people (be they progressive or conservative) don’t like being lumped in with liberals, because they don’t focus on as much on individual freedom but rather on collective freedom and on policies that benefit the collective. Hence their insistence on actually looking at the full political spectrum rather than the simplified/reducted version of it.

You’re not wrong that people in the US tend to call liberals “left-wing”, but it’s a very reductive, American perspective not shared by political scientists or the rest of the world.

Yes, liberals tend to define the entire scope of political economy to a narrow, capitalist viewpoint. That doesn’t make it correct. A huge range of viewpoints narrowly occupies the “radical” portion, while an absolute mountain of space comparatively is given to subdivisions of capitalism. It’s a deeply silly graph.