David’s Reviews > Selected Essays on the Dynamics of the Capitalist Economy 1933–1970 > Status Update

"Luxemburg maintained that capitalism is saved by 'external markets'. In her time ut was no doubt exaggerated but it has proved right today." In this case, Kalecki is referring to markets that can absorb surplus value over and above what 'normal' circulation would permit, ie government investment financed by taxing capitalist/rentier profit. Taxing workers merely displaces consumption, it doesn't add any.

"Gross profits = gross investment + capitalists' consumption". Does it mean that profits determine capitalists' consumption and investment? [...] Capitalists may decide to consume and to invest more in a given period than in the preceding one, but they cannot decide to earn more. It is, therefore, their investment and consumption decisions which determine profits, and not vice versa.

"[Capital taxation] has all the merits of financing the State expenditure by borrowing, but ... [has] the advantage of the State not becoming indebted. It is difficult to believe, however, that capital taxation will ever be applied for this purpose on a large scale; for it may seem to undermine the principle of private property."

"If a government borrows from the capitalists at home, spending the proceeds of the loan, e.g. on armaments, payments of doles, or public works, the result is very similar to that of securing a surplus in foreign trade. ... The formula for profits must be modified: in addition to capitalists' consumption, investment and the balance of trade, they also include 'domestic exports'."