The Soviet idea was that 1) if it's state-owned, then it's people-owned and not capitalism, 2) it's people-owned, because USSR is a union of soviet republics, where soviet is a democratic (initially) entity, 3) it's socialism, not communism, as we've not built that yet, 4) it's still socialism as we use money to buy things and not receive them as we need automatically, as the planning precision doesn't allow for this.

(A soviet is initially like an elected body, where every member on level zero is elected by constituency, like certain factory's workers or inhabitants of some street, as this thing was static in the USSR, or on every level above zero by an underlying level soviet ; the main difference between this and normal democracies is that those factory workers or that underlying soviet can vote anytime to recall and replace their representative, which turned out to make it more authoritarian all by itself ; well, also obviously these in fact decided nothing in the USSR anyway, the party structures did).