The Liberal Democrats, often known as the "Lib Dems", are a political party in the United Kingdom. They have traditionally occupied the center of the political spectrum, between the Labour Party on the left and the Conservative Party on the right ("liberal" in British political parlance means "centrist" or "moderate" rather than "left-wing", as it does in the United States). They have also been described as "radical center", a political philosophy of having no inherent bias towards the left or right wings, and attempting to resolve political policy and events by taking input and/or advice from all salient viewpoints, and being willing to at least consider radically different new policies, provided those policies are well thought-out and examined. At the present time, the party is seen as being moderately left-leaning.
The Liberal Democrats were formed in 1988 by a merger between the centrist British Liberal Party and the moderately left-wing Social Democratic Party, which had split off from the Labour Party in the early 1980s when the latter became too strongly socialist. The Liberal Party was one of the oldest political parties in the world, tracing its roots back to the Whigs of the era of William of Orange, but it had been in decline ever since the rise of the Labor movement in the early 20th Century, and had not had a prime minister since David Lloyd George.
Since its foundation, the party had steadily increased its presence in the House of Commons at each successive election, until 2010. The party won 62 seats in the 2005 general election - the most that the party or its predecessors had won since the election of 1923. However, in the general election of 2010, the number of Liberal Democrat MPs elected fell to 57.
Their policies can be broadly described as social-democratic, with a libertarian bent. They are in favor of legalization and government regulation of marijuana, and decriminalizing the possession (but not supply) of other illegal recreational drugs, believing that medical treatment for drug addicts is more helpful than prosecution or imprisonment. They also argue for a rationalization of the currently confused status of the various components of the United Kingdom, such as simplifying the benefits system for disabled people.
They support laws against discrimination based on race, gender, disability, religion and sexuality. The party traditionally advocated higher spending funded from higher taxes, but from 2007 onwards have advocated replacing or cutting some taxes, particularly Council Tax, which takes a higher proportion from the poor than the rich. They opposed the Iraq War, but were in favour of the Bosnian and Kosovo wars. They are the most pro-European Union party in British politics, and support an amnesty for illegal migrants that have lived in the UK for a decade without a criminal record, however, they wish to tighten control on immigration, especially illegal immigration, through reforms of immigration law and the creation of an integrated border police force, returning the UK to a policy of entry and exit controls, to monitor movement in and out of the UK. Lib Dems, like most other parties in the UK, want the UK and the EU to take the lead in combating Global Warming. The Lib Dems want to stop global temperatures rising more than 2 degrees Celsius above the 1990 average, by making the UK a zero-carbon economy by 2050, and having more efficient buildings and transport. The party's terms for a coalition have always included introducing proportional representation for elections, and their terms for the 2009/10 election include: to reform government by capping private donations, reducing the number of MPs, having a 100% elected House of Lords (it is currently made of bishops, party appointees, and hereditary peers), and having a written constitution and a Bill of Rights, as current UK constitutional law is confusingly spread out over parts of several legal documents.
There is a growing consensus that the Liberal Democrats have no real policy goals at all, or if they do they are irrelevant. Part of the deal with them going into partnership with the Tories was a referendum on the so called alternative vote, thankfully this was rejected by the UK voters.
Had this passed it would have gave the Lib Dems the whip hand, as under this system it is unlikely that either the Conservative or Labour parties would ever win an overall majority in The House of Commons, giving the Lib Dems the balance, far more power than they will ever be mandated to hold. With this power they would be able to support, and withdraw support to either of the larger parties at a whim, being able to switch sides whenever it suited them, thus becoming the most powerful force in British politics and undermining British democracy. This rather goes against their baby hugging, every-bodies friend image. Thankfully this very real example of liberal creep failed
The party is poorly funded in comparison to its main rivals, leading to them accepting money from almost any source.
Their largest ever donor is convicted fraudster Michael Brown, a former bonds dealer who was convicted of stealing £30 million from his clients, who donated £2.4 million to the party.. They managed to avoid repaying the money after exploiting a technicality in the rules after a year long battle. 
- http://news.bbc.co.uk/1/hi/programmes/politics_show/7148179.stm Clegg nicks it
- http://news.bbc.co.uk/nol/ukfs_news/hi/uk_politics/vote_2005/ Election 2005 results
- http://news.bbc.co.uk/1/shared/election2010/results/ Election 2010 results
- http://www.libdems.org.uk/what_we_stand_for.aspx Liberal Democrat policies
- http://www.libdems.org.uk/media/documents/policies/11CivilLiberties.pdf Protecting Civil Liberties
- http://news.bbc.co.uk/1/hi/uk_politics/3130988.stm Lib Dems vote to axe council tax
- http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2007/09/18/nlibdem718.xml Lib Dems want amnesty for illegal immigrants
- http://www.guardian.co.uk/politics/2007/aug/29/uk.greenpolitics Lib Dems see zero-carbon Britain setting the global green agenda
- http://www.guardian.co.uk/politics/2008/mar/10/liberaldemocrats.nickclegg Clegg's terms for deal in hung parliament
- Arrest warrant issued after Liberal Democrat donor Michael Brown skips bail, TimesOnline, July 30, 2008
- Lib Dems face repaying £2.4m after Michael Brown, party's biggest donor, convicted, TimeOnline, November 29, 2008
- Top Lib Dem donor stole millions, BBC, November 28 2008
- Donations by 5th Avenue Partners Limited to the Liberal Democrats: statement, November 20, 2009