still been unable to solve its chronic problem of low profitability.

Nor for that matter have the other eastern European countries. They however have be been forced to integrate themselves into the rest of the world market to a much greater extent than the USSR, and they have therefore suffered accordingly as the world market slumped in 1974–75. (There is also no doubt that the 1979–80 slump will have an effect at least as serious.) Take Poland for instance, which, as we have seen, has had one of the best eastern growth records. Its leaders were forced by the strikes and uprisings of 1970–71 to increase living standards. They paid for this and increased their growth by a massive increase in trade with the west, which was itself undergoinghalf of this is with the west. The government has dismantled all controls other than fiscal and credit over enterprises, and is now eliminating all import subsidies. As a result, inflation, which stood at 4% in the late ‘70s is expected to be running at 10% in 1980. To reduce costs and increase flexibility the government is encouraging mass sackings: the creation of a reserve army of the unemployed. The National Bank has declared itself in support of the convertibility of the forint, and there is a good 50% chance that Hungary will join the IMF. On top of this Hungary has moved into the world of finance capital in a big way. It permits majority foreign participation in financial and service ventures, and it has itself, in