In the United States, liberalism means the embrace of an activist, interventionist government, expanding its involvment and responsibility in the economy. In the rest of the world, liberalism means almost exactly the opposite -- what an American liberal would, in fact, describe as conservatism. This kind of liberalism supports a reduced role for the state, the maximization of individual liberty, economic freedom and reliance on the market, and decentralized decision making. It has its intellectual roots in such thinkers as John Locke, Adam Smith, and John Stuart Mill. It emphasizes the importance of property rights and sees government's role as the facilitation and adjudication of civil society.
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How was the meaning of the word altered so dramatically in the United States? During the First World War, some of the leading Progressive writers began to use the word liberalism as a substitute for progressivism, which had become tarnished by its association with thier fallen hero, Theodore Roosevelt, who had run and lost on a Progressive third-party ticket. Traditional liberals were not happy to see their label transformed. In the 1920s, the New York Times criticised "the expropriation of the time-honored word 'liberal' " and argued that "the Radical-Red school of thought... hand back the word 'liberal' to its original owners." During the early 1930's, Herbert Hoover and Franklin Roosevelt duked it out as to who was the true liberal. Roosevelt won, adopting the term to ward off accusations of being left-wing. He could declare that liberalism was "plain English for a changed concept of the duty and responsibility of government toward economic life." And since the New Deal, liberalism in the United States has been indentified with an expansion of government's role in the economy.
