  Previous calculations of the polarizabilities of the nucleon within the
framework of heavy baryon chiral perturbation theory have included the
contribution of the $\Delta$(1232) only its effect on various contact terms or
have been performed in chiral SU(3) where systematic errors are difficult to
control. Herein we perfrom a corresponding calculation in chiral SU(2) wherein
$\Delta$(1232) is treated as an explicit degree of freedom and the expansion is
taken to third order in soft momenta, the pion mass and the quantity
$M_\Delta-M_N$, collectively denoted by $\epsilon$. We present the results of a
systematic $O(\epsilon^3)$ calculation of forward Compton scattering off the
nucleon, extract the electric polarizability $\bar{\alpha}_E$, the magnetic
polarizability $\bar{\beta}_M$ and the spin polarizability $\gamma$ and compare
with available information from experiments and from previous calculations.
Concluding with a critical discussion of our results, we point out the
necessity of a future $O(\epsilon^4)$ calculation.
