"Liberalism," you see, wasn't always a dirty word. In fact, most all of the political thinkers who laid the foundation for the American experiment were, in their day, proud liberals. The thinkers who influenced the founders -- Adam Smith, John Locke, John Stuart Mill -- and the founders themselves -- Thomas Jefferson, James Madison, Benjamin Franklin, George Washington -- all bore the liberal label with honor.
In fact, in most of the world, "liberalism" still connotes the values and principles all of those men espoused. In Europe, Latin America and Asia, "liberalism" still means belief in political pluralism, freedom of expression, property rights, the rule of law -- basically all of the ideas and principles free thinkers here in America hold dear.
So what happened? Why is "liberal" such a bad word here in America that even the liberals don't want it? Why, today, do political economists offer two definitions of liberalism, one for the likes of Locke and Jefferson, and another for our more modern impression of the word -- people like Hillary and Kennedy?
As the Cato Institute's (search) David Boaz writes in his book Libertarianism: A Primer, "around 1900 the term liberal underwent a change. People who supported big government and wanted to limit and control the free market started calling themselves liberals. The economist Joseph Schumpeter noted, "As a supreme, if unintended, compliment, the enemies of private enterprise have thought it wise to appropriate its label."
So what Smith and Mill called "liberalism" we today call "classical liberalism" or "libertarianism." Conservatives too sometimes lay claim to old-school liberalism, though I think that in doing so, they underestimate just how much distrust the original liberals had for the state. There are lots of policy proposals put up by conservatives today that would have made the original liberals cringe.
Just word games....
