I would have to disagree that American liberalism broke down and could not solve the problems of the country effectively. "Before the New Deal gave the term liberalism its modern American meaning, it was a little-used word that referred to a belief in laissez-faire economics and limited government." (http://college.hmco.com/history/readerscomp/rcah/html/ah_053200_liberalism.htm) The New Deal, The Fair Deal, The New Frontier, and The Great Society all brought about social change within the United States.
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