Pope John Paul II said Thursday communism has failed but warned Western capitalists against viewing that collapse as a "one-sided victory of their own economic system, and thereby failing to make necessary corrections in that system."

At the same time, the Polish-born pontiff said in a new encyclical - or teaching letter - that the collapse of communist regimes in Eastern Europe presented "a real danger" that longstanding hatreds in those nations "will re-explode . . . provoking serious conflicts and casualties" unless there is continued economic and moral assistance from the West.