There were several answers to this question, all posted below.
1.
Hi all,
I hope this text comes through.. not sure it will.
I just noticed I had this question yesterday and have done some prelim research but haven't uncovered source yet. The urgency is immediate, so I'm going to ask for help because I can't get back to it until later tonight.
I have done a quick Google search trying to find a source. Didn't see one but doesn't mean it's not there. I searched Lexis-Nexis quotations db but, not surprisingly, it didn't come up. I searched a number of academic databases looking for phrases and general articles are Thomas.. nothing. I spent only about an hour doing this, so this may still be fruitful. I'm in a job with limited access to "good" dbs, but did search JStor, Academic Search Elite and Expanded Academic ASAP. The contents of these varies from campus to campus so that info probably isn't too helpful.
That is as far as I got.
Oh, and I skimmed the one Thomas book I have "Socialism Re-examined" and did not find this quote nor any similiar statements.
Thanks for your help! Would love to hear other suggestions for how to search (other quote dbs?). I'll be able to pick this up later tonight if no one responds.
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2.
Sorry this is far from "immediate" as your urgency note requested. About 6 of us have had no luck yet finding this anywhere except in web sites and books that do NOT give a source for it. This is a great example of "you can't prove that someone DIDN'T say something"
We can build evidence for the possibility, or questionability, of this by looking at other people's efforts to find it - for example, books.google.com search: liberalism socialism "norman thomas" gets 84 hits, including Lou Cannon. Governor Reagan: His Rise to Power. PublicAffairs, 2003. ISBN: 1586480308. (F866.4.R43 C36 2003 in most academic libraries; in 979.4... or BIO section of most public libraries). On page 125, Cannon says [of Reagan] ..."a favorite line was this supposed prediction of Norman Thomas...", and "This is a suspect quotation, and Reagan gave no reference for it". Cannon also says in a note "If Thomas said this, I have been unable to find evidence of it...."
Naturally, a thorough researcher would try to find many other such books, from people of various political bents, to build a case that such a quote is either probable, possible, or unlikely. One would think such a striking quote would make it into biographies of Thomas; try the tables of contents and indexes for "Liberalism", etc. Even statements from social and political historians (who claim to have looked for such a quote) can help build a case for or against it.
But it IS a good example of how even a false quote can take on a life of its own, because it shows how hard it is to prove a person did NOT say something - even if a "grand champion" history reference expert DOES end up finding this particular quote somewhere in unpublished Norman Thomas correspondence.
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3.
I wanted to elaborate on what we actually searched for the alleged Norman Thomas quote on liberalism vs socialism. We checked quotations in Bartletts (Bartleby.com), Lexis Academic, the text of news articles from New York Times and Washington Post Historical - searching: liberalism and socialism and "norman thomas"; a few biographies of Thomas,
including: "Norman Thomas: The Last Idealist" by W.A. Swanberg (1976), and "Prophets of the Left" by R. Hyfler (1984).
Web searches turned up a related quote from Upton Sinclair (which ALSO should be double checked!) in Wikipedia -
http://en.wikiquote.org/wiki/Upton_Sinclair :
"The American People will take Socialism, but they won't take the label. I certainly proved it in the case of EPIC. Running on the Socialist ticket I got 60,000 votes, and running on the slogan to 'End Poverty in California' I got 879,000. I think
we simply have to recognize the fact that our enemies have succeeded in spreading the Big Lie. There is no use attacking it by a front attack, it is much better to out-flank them. Letter to Norman Thomas (25 September 1951)". See also at the bottom of http://www.spartacus.schoolnet.co.uk/Jupton.htm
