Public Policy Sources #33:
The “Third Way”—A Brief History of the Term

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For more than a century, the term “Third Way” has been employed by individuals, movements, and parties on both the right and the left of the ideological spectrum. In the late 19th century, Pope Pius XII called for a “Third Way” between socialism and capitalism that would put a more human face on the free market. Wilhelm Roepke, the classical liberal economist, said the “Third Way” consisted of the free society, which lay between socialism and historical liberalism. However, a free society (at least by classical liberal standards) was no longer the definition employed by General Francisco Franco’s Spanish fascists when they appropriated the term in the 1930s. During the same decade, the American journalist Marquis Childs suggested that Sweden’s socialist welfare state constituted a “Middle Way” between American capitalism and Soviet communism.10 During his tenure as British Prime Minister, Conservative Harold Macmillan spoke of Britain’s post-war, mixed economy as a “Middle Way.” By the 1960s, many reform-minded Eastern European communists were referring to “market socialism” as a Third Way, as were Eurocommunists throughout Western Europe. The contemporary application of the term originated in the United States in 1990. It was coined by the Democratic Leadership Council (DLC), the national political lobby organization, as convenient shorthand for the allegedly distinctive viewpoint of the “New Democrat” politicians and thinkers who, according to the DLC, were “addressing the very new problems facing the country in a new era.”11

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