A mixed economy, such as the system in the present-day United States, combines features of liberalism, fascism, and other forms of socialism. Although some vestiges of individual rights remain, large areas of economic and personal life are subject to governmental regulation, and various programs may seek to "redistribute" income to subsidize politically favored groups. Individual freedom is recognized only on a conditional basis, subject to abrogation whenever it is deemed to conflict with the "public interest," so that in a basic sense freedom can be said no longer to exist at all.

The mixed-economy system is sometimes also called the "welfare state." Indeed, because of its propensity to engage in foreign military interventionism as well as domestic interventionism, some have dubbed it the "welfare-warfare state." The term "welfare," however, may lead to the mistaken impression that the programs of such a state primarily serve the less affluent, since they are the intended recipients of the programs usually designated as "welfare." In reality, as will be demonstrated later, mixed-economy programs are almost inevitably directed toward fulfilling the personal desires of members of the most politically powerful groups, usually including the wealthiest segments of society—even though those same programs may sometimes be represented as having humanitarian intentions. In order to avoid confusion, therefore, the term "mixed economy" is preferred in this course.