Bump.
Sad to see "full employment" being conflated here with "workfare" and the like, but this is precisely what I was talking about when I suggested some social democrats are the biggest obstacle to full employment because they have an irrational fear of it replacing the welfare state, or, that full employment would require coercing workers to work.
A full employment policy would mean the state using its power to create what is essentially a "permanent labour shortage" (for lack of a better phrase) in key industries so that the supply of new jobs would always be equal to or more than the number of citizens looking for jobs. This can be done any number of ways (nationalization of certain industries, a permanent stimulus fund, long-term investment in the public sector and in infrastructure, etc.). It's rooted in Keynesian thinking but it is also a fundamentally socialist/progressive concept meant to eliminate unemployment - the unwanted kind of unemployment, that is. The cautious/liberal method would be to allow the private sector to have complete control of the labour market, and then the state would step in as a last resort and provide the residual unemployed with jobs.
Full employment policies have existed, a basic wiki/google search turns up these examples: Clement Attlee's near complete adoption of the Beveridge report in the UK; the U.S. Employment Acts of 1946 and 1978 (which Jacob Richter alluded to above)... they came close but got watered down; and Australia came closest in the immediate post-WWII era.