The Berlin Wall – the physical barrier dividing the “communist” east from the “free” west – collapsed under the pressure of a magnificent mass movement in 1989. It was difficult, in 1989, not to be sympathetic with the beautiful sight of ordinary East German workers, physically dismantling an ugly barrier which had disfigured the city of Berlin since 1961. But among those in the West who were sympathetic to the revolt from below, most were influenced by what was without question accepted as a truism – that the collapse of the Berlin Wall symbolized the superiority of the market compared to "state-socialism". East and West started out in much the same shape after the war, the argument goes. But in the west the market, with all its flaws, led to France, West Germany, Sweden, etc. developing into some of the biggest economies in the world, while East Germany, Hungary and the rest of the East stagnated. State control just does not work and the market, with all its problems, has proven its superiority. The problem with this argument is that East and West Europe did not begin from the same point at the end of World War Two.
Western Europe is home to economies which were the first in the world to undergo industrial revolutions. First in Netherlands and England in the sixteenth and seventeenth centuries, followed by France in the late eighteenth century and finally Germany in the late nineteenth century — it was here that capitalism firmly took root, smashing up the old, peasant-based societies, and laying the groundwork for extremely rapid industrialization.
The basis for this industrial strength was driving the peasants off the land, and turning them into wage-labourers in the sprawling new cities of Europe — Manchester, Paris, Turin, Berlin. The wealth produced by an industrial working class – working in large collective workplaces with access over time to more and more machinery and automation – is far greater than that produced by a peasantry working in labour-intensive conditions on small plots of ground in the countryside. The Dutch, the French and the English, on the basis of the massive growth of their industrial economies in the nineteenth centuries, embarked on a global competition for world supremacy, ultimately bringing all or part of every continent in the world under their imperial control.
They were joined by Germany and the New World upstart the United States in the nineteenth century. The rivalries of these capitalist giants twice exploded into world war in the twentieth century.
The situation in what, before 1989, was called “Eastern Europe,” was very different. Much of Eastern Europe had, until very late in the day, aristocratic ruling classes that were much more successful at resisting the advance of capitalism than were their counterparts in the west. The wealth of the aristocracy was based on peasants tied to the great landed estates. Thus the aristocratic ruling class had an interest in preserving the old, peasant-based economies, and resisting the advance of industrial capitalism.
For reasons that are beyond the scope of this article, this ruling class was much more successful in Poland, Russia, Bulgaria, Rumania, etc., in resisting the rise of an industrial capitalist class, than in the West.
In the East, the bulk of the population until well into the twentieth century, continued to live very traditional lifestyles in labour-intensive conditions on the land. The development of the industrial working class occurred, but as a small minority inside society. It wasn't until the 1860s that serfdom was abolished in Russia. When the Russian Revolution happened in 1917, there were 15 times as many peasants as workers in the country. It was only as a result of defeat in World War II that the power of the old aristocratic ruling class in the Austro-Hungarian Empire was broken up.
Similarly the Ottoman Empire – from which came Turkey as well as several of the southern republics of the Soviet Union – survived the beginning of the twentieth century intact, its semi-feudal ruling class a real barrier to capitalist development. Only with defeat in the First World War was this ruling class smashed up and the possibility of industrial development opened up.
In short, the bulk of the "Eastern Bloc" was carved out of those sections of Europe and Asia that had been very late in embarking on a path of industrialization. The bulk of the "Western Bloc" was comprised of those countries that had been the first to industrialize, that had made incredible strides in the nineteenth and twentieth centuries in developing their industrial base, and had been able to, on that basis, spread their economic interests throughout much of the globe.
There are exceptions to this. Spain and Portugal in the Western bloc were late-industrializing countries, while East Germany in the Eastern bloc had been an historical heart of much of German industry. But in general, the pattern of most-advanced economies ending in the Western bloc, least advanced ending in the Eastern bloc, is accurate.
It means that the two sections of Europe that ended up confronting each other after World War II – a Western section under the hegemony of Washington, and an Eastern Section under the hegemony of Moscow – were coming from very different places. In the West, for the most part, were economies with a history and tradition of industrial capitalism going back generations. In the East, for the most part, were economies which until quite recently, had been under the thumb of conservative and reactionary land-based aristocracies, and which were, as a result, considerably poorer and considerably less industrialized than their counterparts in the West. It was not a contest between equals.
Read next: The Legacy of World War II
© 2009 Paul Kellogg
 See E.J. Hobsbawm, The Age of Revolution: 1789-1848 (Toronto: New American Library, 1962); Immanuel Wallerstein, World-Systems analysis: An Introduction (Durham, North Carolina: Duke University Press, 2004).
 In one of his early, and largely overlooked books, Ygael Gluckstein (Tony Cliff) makes this exact point. “Of the total population those engaged in agriculture, fishing and forestry made up in Bulgaria (1934) 80 per cent; Yugoslavia (1931) 79 per cent; Rumania (1930) 78 per cent; Poland (1931) 65 per cent; Hungary (1930) 53 per cent; Czechoslovakia (1930) 38 per cent.” Ygael Gluckstein, Stalin’s Satellites in Europe (Boston: The Beacon Press, 1952), p. 13.