Keynesianism, one of the leading trends in bourgeois political economy in the epoch of the general crisis of capitalism which stresses the need of state intervention in the process of reproduction. The emergence of this theory is associated with the British economist John Maynard Keynes (1883-1946). In the 1930s he greatly transformed bourgeois political economy (known as the "Keynesian revolution”) on the basis of the important changes in the mechanism of capitalist reproduction associated with the growth of monopoly domination and the strengthening of statemonopoly tendencies. The depression of 1929-1933 made a great impact on Keynes’s views, for it graphically demonstrated that the state had to interfere in the process of capitalist reproduction. In contrast to the neo-classical trend in bourgeois political economy which reigned in the late 1800s and the first quarter of 1900s, Keynes concentrated his analysis on the economy as a whole. This approach became known as macroeconomic, thus giving the name of macroeconomics to his theory. The central problem of macroeconomics is the factors determining the level and dynamics of the national income. Keynesianism treats these factors primarily from the viewpoint of realising commodities by way of shaping the so-called effective demand. By analysing the main components of effective demand—- consumption and accumulation (i. e., personal and productive demand) the advocates of Keynesianism concluded that their sum total, because of a possible discrepancy between the aggregate supply of goods and the aggregate demand for them, may be insufficient for sustaining the level of the national income corresponding to “full” employment. From this arises the possibility of forced unemployment, depression and economic crises, and the need for the state to sustain effective demand. This conception served as a basis for the neo- Keynesian theory of the cyclical development of the capitalist economy (Alvin Hansen, John Hicks, Paul Samuelson). Although the advocates of this theory refused to recognise crises during which all the contradictions of capitalist reproduction explode, they were nevertheless compelled to recognise cyclical fluctuations as an inherent feature of the capitalist economy. By viewing them as a result of the insufficiency or excess of effective demand, they put forward a corresponding programme of anti-cyclic measures, based on the possibility of using budgetary, monetary and credit levers to indirectly regulate the economy. The idea is to limit the growth of demand during a boom stage, and hence to restrict price rises and, on the other hand, to expand demand during an economic recession or crisis. After the war, the so-called neo-Keynesian theory of economic growth (Roy Harrod, Evsey Domar) also gained currency. While considering the accumulation of capital as the main factor of economic growth, and by viewing the conditions of this accumulation over the long term, Keynesians claimed to have proved the necessity of state intervention to prevent prolonged deviations from “stable” economic growth. In the 1950s and 1960s Keynesianism became the dominant school of bourgeois economics. Theories in the Keynesian mould were adopted by almost all governments of industrially developed capitalist states as a method of regulating effective demand and as a basis of anti-cyclic (anti-crisis and anti-inflationary) policies. Apart from the anti-cyclic policy, based on the regulation of aggregate demand using budgetary, monetary and credit levers, efforts were made to carry out state policy in medium-term and long-term economic planning. The late 1960s and early 1970s were marked by profound changes in the socio-economic conditions of capitalism. They manifested themselves in a whole series of crises—raw-materials, monetary and financial, and cyclical—and in the rapid development of inflationary processes which greatly undermined the entire world capitalist system. These crises, and especially spiralling inflation, have 183 resuited in a crisis of economic policy. The standard Keynesian schema of anti-cyclic policy according to which inflation, usually coinciding with a boom stage, could generally be controlled by restricting demand, while crises, on the other hand, could be alleviated by expanding demand, proved untrue. It became evident that the Keynesian doctrine of the state-monopoly regulation of the economy by stimulating it via budget deficits was totally impotent. It also became difficult to flexibly manipulate the interest rate, since it had to be raised and credits grew more expensive. All these difficulties stimulated the development of crisis phenomena within Keynesianism itself. The crisis of neo- Keynesianism as an official doctrine of state-monopoly regulation was marked by renewed attacks on the theory from the right, i. e., from the neoclassicists, its traditional adversaries. The central controversy between representatives of these two wings of bourgeois political economy is the role and scope of state intervention in the economy. The crisis in Keynesianism stimulated a search for new opportunities for “renovation” and the further development of this theory among its advocates. This search is continuing, primarily in two directions. The first trend claims to be a "new interpretation" of Keynes, a “reconstruction” of the Keynesian analysis in the spirit of Keynes’s ideas which it is claimed were forgotten or discarded by his “careless” followers. American economists like Axel Leijonhufvud, Robert Clower and Paul Davidson sharply criticised the orthodox, “standard” model of Keynesianism which, they said, distorted the true essence of Keynes’s theory. They have tried to restore the monetary aspects of this theory in order to adapt them to the analysis and regulation of inflationary situations. They also underline the importance of the uncertainty and imperfection of the information which determine, in their opinion, the instability of the capitalist system. The second trend tries to include Keynesianism in a broader political economic system based on the development of its left, or radical, interpretation. Its prime movers are Joan Robinson, Piero Sraffa and Luigi Pasinetti, to mention just a few. This left wing of Keynesianism has now formed an independent—post-Keynesian—trend in bourgeois political economy which sharply criticises the foundations of all orthodox bourgeois political economy. At the same time the advocates of this trend are trying to develop a system of views of their own, based on the traditions of left Keynesianism in macroeconomics and the views of Ricardo in treating the problems of value and price formation. All these new processes in the development of Keynesianism demonstrate that bourgeois political economy is at cross-roads. The old conceptions have lost their value, and there is a need to overhaul economic theory in order to provide new opportunities for defending capitalism.