And prior to FDR the Democratic party was the party of small government.
I'm referring the United States in the present day, where (generally speaking) the word liberal refers to Democrats more often than Republicans, and the idea that taxation is theft is an order of magnitude more closely associated with the latter than the former.
Classical liberalism : The word "liberal" in common discourse :: Classical literature : Harry Potter
"Economic liberalism contrasts with ideologies like social liberalism and social democracy as well as economic orders such as socialism, market socialism, welfare capitalism, mercantilism and state capitalism [...] opposes government intervention on the grounds that the state often serves dominant business interests, distorting the market to their favor and thus leading to inefficient outcomes"
Et cetĕra.
See also:
- http://en.wikipedia.org/wiki/Classical_liberalism
- http://en.wikipedia.org/wiki/Laissez-faire