Today's liberal debate concerns: neoliberalism. Let me make a small point for the defense. The other Jonathan rightly points out that neoliberal aims helped rehabilitate the cause of fiscal responsibility among liberals. At Tapped, Ezra Klein expresses skepticism that there ever were any fiscally-irresponsible Democrats.
In fact, the merits of deficits were a raging debate during the 1980s. Read this Michael Kinsley article which shows just how controversial a proposition this was at the time. Ezra could also delve into some back issues of his own magazine, which argued during the Clinton years that the administration's focus on deficit reduction over social outlay was completely misguided.
I think Matthew Yglesias's rebuttal makes many of the other key points.