This is what I was thinking it means: that there are natural inequalities in society which will create suffering and so the rest of society (via taxation) should help and support those that are struggling. The inequalities could be: having a disruptive upbringing, being held back educationally and socially by lack of wealth, not having any particular talents or abilities that can be commodified and used to create your own wealth, disabilities, having children young, being of a persecuted race, religion or culture.
And so higher earners would be be taxed which would be used to help the lives and to even out quality of life for those who have a low paying job (e.g. cleaner) or job that generates low level income (freelance artist).
So basically even if society sees your job and your skills as not very valuable you should still have a decent quality of life as you are a human being, and so the rest of society should give some extra money (through taxing) to top them up and equalise it out? Along with this is allowing different view points and voices to be heard and understanding different people's problems and needs in society such as their religions and cultures. Is this sort of what it means?
I know people use the term "liberal" to mean they don't mind how individual people live their lives, but isn't that technically libertarianism? Or can the two terms be used interchangeably?
I think true liberals are libertarians who can be left or right leaning. What you describe is the American definition of the word which is synonymous with leftist.
A liberal is someone who thinks they should be entitled to have everything handed to them on a plate without putting in an ounce of work.
A liberal is someone who has no respect for tradition, and promotes immoral practices such as abortion, homosexuality, pornography, and drug use.
A liberal is someone who calls everything "racist", "sexist", ..., but has no problem sending people death threats and causing violence.
"liberal" is the term conservatives use for any person they disagree with.
People often confuse American liberalism with what liberalism is in Britain. In Britain, liberalism has a much more complex history. In the 1800s Gladstonian liberalism was the main ideology of liberals. Gladstonian liberalism was very centrist. It encouraged limited government intervention and encouraged people to help themselves. By our standards today this wouldn't be considered liberalism and it is more accurate to compare it to the ideology of Thatcher.
Gladstonian liberalism was replaced by something called New Liberalism. New Liberalism called for more government intervention and introduced many policies that were the pre-runners to the welfare state. Both labour and conservative prime ministers supported New Liberalism. This includes Churchill, Asquith, and Lloyd George.
However, after world war one, new liberalism started losing support. There was also a lot of internal conflict between radical progressive liberals and more conservative liberals. The result of this was the radical progressives split to join the Labour Party and the conservative liberals, as you guessed it, the Conservative Party.
All of this makes it difficult to give a proper definition of Liberalism in Britain. The most accurate description of Liberalism in Britain is that liberals support more government intervention in the lives of people. Both parties in Britain support this. This is one of the reasons why the Conservatives and Labour have similar views on social issues like abortion, gay rights, etc. Economically, they are different, which is the reason why both parties formed to oppose each other.
In the United States, their parties are much more polarised, and they have very different views to Britain on what it means to be liberal because of their very different political system.