How did the term "liberal" acquire the connotations of social democracy in America?

[Stirnerian]

I understand that it occurred around the time of the New Deal, but I can't find any specific information about it on-line. Is it something New Dealers took to calling themselves?

Obviously Europeans have always used "liberalism" to refer to pro-business economic policy (though the conflation of American libertarianism with "classical liberalism" seems inaccurate - certain historical liberals like Gladstone favored limited reformist measures). Am I correct in assuming that "liberalism" in an American context would have had the same connotation in nineteenth-century America as it does in Europe at present?

[ComradeAllende]

America was founded on the basis of classically-liberal ideals: individual rights, private property, meritocratic rule, as well as an on-again off-again relationship with free capitalist markets. Thus, liberalism is the default setting for American politics and philosophy, and all political leaders/movements must pay fealty to this reigning ideology. Whereas in Europe liberals (and later the socialists) had to contend with the feudalistic aristocrats, who still maintained power in a number of European countries (Great Britain, Prussia, Hapsburg Austria, etc). Also, the reigning two-party apparatus plays a role; the social democratic program of industrial regulations, trade unions, and social welfare was adopted by the Democratic Party during the New Deal (the GOP still holding to classically-liberal ideas on fiscal and economic policy), thus preventing the rise of a contending socialist/social democratic party and effectively co-opting the social-democratic platform under the "liberal" mantra. It's funny cause before the New Deal, the Democrats were traditionally associated with white-ethnic populism and conservatism (with their Southern base), while the Republicans were favored as more socially and economic progressive (at least after the Civil War).

It's helpful to note how the ideologies that rivaled/contended with "liberalism" shaped the movement's identity on both continents. In Europe the classical liberals (and later the socialists) had to deal with the feudal conservatives, who held significant power in most European countries (France being the only meaningful exception). Eventually the liberals compromised on certain issues in order to gain representation. America, on the other hand, never had this clashing dynamic; liberalism monopolized the political discourse, and modern "liberals" are associated with the more social-democratic wing of the movement whereas modern "conservatism" arches toward traditional classical liberalism (along with large doses of traditionalist morality and the imperialistic "neoconservatives").

[Stirnerian]

That explains a good deal, actually: the argument is that American "liberalism" is simply liberalism within a liberal context, and that American "conservatism" is liberal conservatism.

I think this terminology, even absent any critique of its contents, is unhelpful and confusing. It should have called itself "social democracy" in the first place.

At any rate, I'm convinced that articulating an opposition to the liberal welfare State (as demeaning and disempowering) without arguing against those who benefit from it is one of the most urgent tasks of the American Left - and I say that as a beneficiary of it. The same logic that allows for transfer payments allowed for the catastrophic bailouts of the Great Recession, and a segment of the American working class senses that and is intuitively angered by it.

If we could forge a thoroughgoing criticism of welfare capitalism without ceding ground to market anarchists and foreground that in our rhetoric, I think it would materially advance class consciousness.

That would of course have ramifications on any economic platform we put forward; worker ownership as against a universal income, for example (or, at least, a coordinated campaign to use the latter to acquire the former, not unlike the reimbursement to feudal lords during the abolition of serfdom in various European nations).

[ComradeAllende]

I think this terminology, even absent any critique of its contents, is unhelpful and confusing. It should have called itself "social democracy" in the first place.

It should have, but it couldn't. Social democracy used to imply the revolutionary struggle through mass-based electoral politics, which in turns implies Marxist socialism. Liberalism, being what it is, cannot fathom any movement beyond capitalism (as old-line conservatives could with feudalism), and so they make deep strides to separate themselves from the socialists (especially the more socially progressive ones).

[Left-Wing Nutjob]

It is important to note that even at the height of the "classical" (problematic term, since IMO the alleged dichotomy between "classical" and "modern" liberalism is far from simple or straightforward) Liberal (note the capitalization) period in the UK, there was a wide range of views among British Liberals in regard to regulation of the capitalist economy, the size and role of government itself, and how extensive the liberal welfare state ought to be.

As for American liberalism, the primary reason that it acquired connotations of social democracy was the fact that, as ComradeAllende aptly noted, liberalism monopolized the dominant political discourse. However, I would also add that the extremely conservative political system - in conjunction with liberalism's ideological hegemony - of the United States has meant that any "reforms", regardless of their nature, have had to be filtered through the particular context of American political life ( a context that is, frankly, extremely constrained in terms of economic and social reforms - even during the height of the New Deal years). Consequently, socialists and other Left-radicals (or even Left-reformists) have had to operate outside of the electoral system in the U.S. to a far greater extent than in many (if not most) other Western bourgeois countries.

The upshot of all this is that it in the context of the American political and electoral system, it is has historically been liberals (and in the 20th century, specifically through the Democratic Party) who have pushed for economic and social reforms - up to a point. However, the liberal capacity (and willingness) for progressive reform has been severely undermined ever since the "neoliberal turn" - which has, of course, restored Capital to a hegemonic position over the American (and global) economy. It was only when the American capitalist class recognized that they (along with the entire system itself) were facing imminent, serious threats that they adopted any significant reforms to the capitalist system (while simultaneously, undermining the radical Socialists and Communists who organized, agitated, and fought for those reforms, especially by the time WWII ended and the USSR rapidly replaced Nazism/fascism as the existential threat to the Western capitalist system; the most egregious example, of course, being McCarthyism).

As for Libertarianism...ugh. IMHO Libertarianism is to Liberalism as 20th century American fundamentalism is to Protestantism: a dogmatic, reactionary interpretation or variant of an ideology that selectively draws on certain themes of that ideology, while at the same time, ripping those themes from their historical context - all for the purposes of serving certain political ends.