ABSTRACT
First, Kalecki's affirmation that full employment adversely affect profits represents a radical departure from the classical Marxist theoretical tradition within which he wrote. Indeed, the argument that profits undergo a wage-induced decline during an economic upswing actually reinforces Kalecki's basic thesis that full employment is not generally in the interest of business. The assumption that a Government will maintain full employment in a capitalist economy if it only knows how to do it is fallacious. In this connection the misgivings of big business about maintenance of full employment by Government spending are of paramount importance. The attitude was shown clearly in the great depression in the thirties, when big business opposed consistently experiments for increasing employment by Government spending in all countries, except Nazi Germany. And the policy of full employment based on loan financed Government spending does not encroach upon profits because it does not involve any additional taxation.
