THE COLLAPSE OF COMMUNISM HAS COINCIDED WITH A crisis of capitalism. At the very time when discredited Marxist dogmas have been abandoned and the former Communist countries are seeking to privatize their industries and replace planning with the market, the capitalist economies have again displayed their traditional weaknesses. For inequality has widened, and large numbers of people are still said to be in poverty notwithstanding the fact that expenditure on the welfare state in its various forms absorbs much the larger part of public expenditure. Increasing scepticism about the welfare state has been accompanied by a loss of faith in macro-economic policy. Not only has mass unemployment returned on a scale that would once have been thought inconceivable but it appears to be assumed, with gloomy resignation, that the number without work, even if reduced by a cyclical recovery, will remain high for an indefinite period ahead. In these respects, the rich West presents a discouraging prospect to the aspiring East.