Why ALC is a feedback loop: the amplifier (or the transmitter's own final stage) senses when the input drive level is too high and sends a control voltage back to the exciter stages to reduce output. That keeps the amplifier operating within its linear range, preventing flat-topping, splatter and possible damage to the amplifier. The ALC line on a modern transceiver and linear amplifier exists for exactly this purpose.
Watch out Reducing harmonic radiation is tempting because overdriving does create distortion products, but harmonics are suppressed by the amplifier's output filtering and low-pass filters, not by ALC. ALC also does not improve efficiency or shape audio response.
ALC = Automatic Level Control: it turns the drive DOWN, it does not clean up the output.