Put at its most basic the Third Way is something different and distinct from liberal capitalism with its unswerving belief in the merits of the free market and democratic socialism with its demand management and obsession with the state. The Third Way is in favour of growth, entrepeneurship, enterprise and wealth creation but it is also in favour of greater social justice and it sees the state playing a major role in bringing this about. So in the words of one of its gurus Anthony Giddens of the LSE the Third Way rejects top down socialism as it rejects traditional neo liberalism.
UK Politics
What is the Third Way?
Tony Blair has committed his government to treading the Third Way. Both US President Bill Clinton and German Chancellor Gerhard Schröder espouse the same doctrine. But what does it really mean? BBC Social Affairs Editor Niall Dickson digs behind the rhetoric.
http://news.bbc.co.uk/2/hi/458626.stm
The so-called “third way” is merely a slippery slope slanting leftwards. Can’t be left socially without also being left economically.
I think we used to have a term called “mixed economy” which encompassed those countries (more or less all of them) which had elements of both capitalism and government involvement. Aside from Marx, I don’t know of any theorists who talked about having no state activities. That being the case, I’m not sure that any of these labels help much. It seems that we have learned that there is a need for incentives to boost production. At the same time, it’s hard to imagine any complete withering away of the state. Private property, the rule of law, and some government seem to be the ingredients that we can expect.