Okay, let's take it from the top. I can't recall when the first time liberal was used in a pejorative sense. Perhaps it began with Reagan. More than likely with Goldwater. Regardless, it was something that originated with Republicans which makes demonizing the word all that more incredulous for multiple reasons. If we parse the word, it really comes from the Middle English via Old French from Latin liberalis, from liber 'free (man).' The original sense was 'suitable for a free man', hence 'suitable for a gentleman' (one not tied to a trade), surviving in liberal arts. But how far can we go with demonizing the word or, in the case of liberals, abandoning the word in favor of something like progressives which reminds me more of a soup than of a political ideology.
Republicans as well as Democrats are always using variations of the word liberal in a host of ways. For example, one might think a phrase like liberal arts, which denotes a curriculum privileges general knowledge and develops a student's critical thinking skills, would be sacrosanct unless, of course, one might be in favor of abolishing both public education and the Department of Education. Then liberal arts become a kind of shibboleth for government intervention. Then there's the word liberty, the condition of being free of restraints, which is much closer to the original meaning of the word liberal than most other liberal words. Liberty is used everywhere. From coinage to insurance companies, from select political sects to Constitutional enjoinders. Everywhere. It too is a kind of shibboleth to let other people know how fundamentally liberal we all are. Of course, we can't forget the word liberate, that is to grant freedom from constraints, as we've attempted to do in Iraq and Afghanistan not to mention Vietnam, Panama, Nicaragua, ad nauseum. In those instances, to be liberal is a righteous ideal and anyone opposed to that sort of thing would be, well, unpatriotic which a word of a different measure is.
But the one "l" word that puzzles me is the co-opted word, neo-liberalism. We all know what a neo-con is, but, for some reason, the left has specifically ignored neo-libs. Now there's something the Republicans especially don't want to deal with because even though Republicans are truly neo-libs they could never countenance being associated with any word or phrase associated with, well, liberal. You're asking yourself, "Why is that?" Neo-liberalism is another way of saying economic liberalism which is something the right has never had a problem in enlisting specifically because what constitutes neo-liberalism are such things as free markets, cutting expenditures for social programs, deregulation, privatization, eliminating anything associated with the welfare of the community (i.e. socialism). The best definition of neo-liberalism is that given by Elizabeth Martinez and Arnoldo García; namely,
Neo-liberalism is a set of economic policies that have become widespread during the last 25 years or so. Although the word is rarely heard in the United States, you can clearly see the effects of neo-liberalism here as the rich grow richer and the poor grow poorer. Around the world, neo-liberalism has been imposed by powerful financial institutions like the International Monetary Fund (IMF), the World Bank and the Inter-American Development Bank -- the capitalist crisis over the last 25 years, with its shrinking profit rates, inspired the corporate elite to revive economic liberalism. That's what makes it 'neo.'That definition is exactly what constitutes and has constituted Republican fiscal policy since Reagan. And yet, the left never uses neo-liberalism in defense of its own liberalism. Instead of incorporating an attack on neo-liberalism (a kind of political homeopathy, if you will) the left abandons its notions of liberalism (if not the word itself) in preference of being "progressive" or "centrist" or some other lame euphemism which, presumably, will guard against any right wing attacks on the label. Like the abuse of the word "bi-partisan," the abuse of the word liberal has become a right wing battle cry for their base and an incentive to use those nasty "second amendment remedies" in order to extinguish liberals once and for all.
If anyone on the left is reading this, anyone with more political clout than I have, like David Axelrod, I think it would be wise to be more rhetorically pro-active, politically homeopathic, by using the word neo-liberal as a way to reprogram the rhetorical agenda. I think calling Republicans what they really are, neo-liberals, would, in effect, be the political equivalent of sunshine on Dracula.