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Buddhist modernism is a scholarly (and increasingly, popular) term for the variety of ways that Buddhism has been adapted, both West and East, to recent (last couple hundred years) Western cultures, philosophies, societies and intellectual traditions. It includes (not an exclusive list):
See the Wikipedia article for more details and references.
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Buddhist modernism just refers to Buddhists who only accept the aspects of Buddhism they consider to be compatable with the modern world. Usually the term is used to describe Buddhists who reject things like Karma and Rebirth but still see the Dharma as having things to offer. It's not a movement, just a catch all term used to describe people like that.
I think it is worth noting though that the term is relative to some extent. For one group of people it would be considered modernism to suggest that the traditional stories passed down aren't 100% accurate, and in other groups rejecting such stories might be the norm. I also think that there is a legitimate place for questioning and analyzing the core claims of Buddhism, although I think that the claims actually stand up whereas people who get called Buddhist modernists tend to think that's not the case for some of them.