The Liberal Democrats of the United Kingdom are founded on a blend of liberal and social democratic ideologies. They primarily advocate for social liberalism, which supports wealth redistribution while maintaining a critical view of increased state power.

The party emphasizes the intrinsic link between liberty and equality, promoting investments and progressive taxation alongside championing civil liberties and advocating for a less centralized economy. This approach sets them apart from many European liberal parties, which often focus more on classical liberalism.

Political Positioning and Influence:

The Liberal Democrats position themselves across the centre to centre-left spectrum, fluctuating in emphasis over time. Historically seen as centre-left, they were perceived as more centrist during the Cameron–Clegg coalition era.

Economically, they often find themselves between the Conservative and Labour parties, generally leaning closer to Labour. Influential figures like Leonard Hobhouse and Anthony Crosland have notably shaped the party's ideology, particularly in aligning with Crosland's vision of social democracy.

Policies and Reforms:

The party is a strong proponent of constitutional reforms, advocating for a decentralized federal structure within the UK, including significant devolution of powers to Scotland, Wales, and English regions. They have consistently supported electoral reforms towards more proportional representation and maintain progressive stances on social issues like LGBT rights and drug reforms.

Their internationalist outlook is evidenced by their sustained advocacy for European integration, including support for the UK adopting the euro, while opposing a European army.

Party Dynamics and Internal Diversity:

There is a notable ideological diversity within the Liberal Democrats, with various factions advocating different shades of liberal thought. The majority faction, the Social Liberal Forum, supports extensive social liberal policies.

Other groups like the Liberal Reform and "Orange Bookers" propose more economically liberal policies. The party has also debated but not implemented policies like all-women shortlists, reflecting ongoing discussions about equality and representation methods.

Economic and Social Welfare Policies:

The Liberal Democrats have a history of supporting social welfare spending and economic policies that balance free market operations with social protection mechanisms. They have proposed various reforms over the years, including education investment, opposition to further privatization or nationalization, and tax reforms aimed at supporting lower-income groups while ensuring fiscal responsibility.

Foreign Policy and European Union Relations:

The party has taken a strong stance on several international issues, supporting interventions where internationally lawful and advocating for responsible foreign policies regarding arms and conflict. They have been a vocal proponent of the UK's involvement in the European Union, promoting policies that enhance integration while also accommodating Eurosceptic perspectives within the party at times.