At the beginning of June 1989, I was sitting in the bar of the Hotel Europejski in Warsaw and reassuring Tadeusz Mazowiecki that his decision to stay on as editor of Solidarity's main publication rather than run in the forthcoming momentous, half-free Polish parliamentary election would in no way affect his political future. Neither of us imagined then that within three months, on September 12, as a result of that election (for he did run after all), Mazowiecki would become the first prime minister in Eastern Europe since the war to head a government in which the Communists were genuinely junior partners. And that this unprecedented event would precipitate a hundred days of spectacular change--one regime tumbling after another--climaxing in the total collapse of the Soviet empire. Indeed, the next couple of years would bring German reunification and the breakup of the Soviet Union. It was the end of a historical epoch.

What was really surprising was the speed of events. The Poles, given a chance, rejected the regime in a ballot. The East Germans did it by voting with their feet, leaving their country in growing numbers. The liberal Hungarian government, breaking the Communist rules, allowed these refugees to cross the Austrian frontier. On November 9, yielding to mounting pressure domestic and foreign, Erich Honecker's successor permitted East Germans to move freely to the West. The jamboree that followed and the dismantling of the Berlin wall were the symbolic climax of the European drama. But already the Czechs were in the streets quickly carrying out their "velvet revolution"; on December 29 Vaclav Havel was unanimously elected President by the Czechoslovak Parliament. By Christmas, with the Romanian regime overthrown, it was all over; the summary execution of Nicolae Ceausescu and his wife, after a parody of a trial, added a final sinister touch to what, up to then, had been a joyful and almost bloodless transition.

The absence of any serious resistance is the other striking feature of the period. Historians may draw from this the conclusion that the system was ripe for surrender: The ruling classes wanted to perpetuate their domination and, therefore, base it not on party rank but on property; the workers were not foolish enough to believe they were the "masters" of their factories and of society and therefore had something to defend. Whatever the future verdict of the historians, what can already be said with certainty is that Mikhail Gorbachev and his perestroika played a crucial role in the transformation of Eastern Europe. It was the Soviet leader who urged the reluctant East Germans to get on with the reforms and who told the Czech hard-liners that they could no longer rely on Soviet tanks to keep them in power. His rejection of the "Brezhnev doctrine," which called for military intervention in the Soviet zone of influence, gave the Eastern European revolution its chance. Indeed, it was a deliberate policy, though whether Gorbachev was aware that it would lead to German reunification and the dissolution of the Soviet Union is another matter. In any case, his perestroika enabled Eastern European dissent--until then, except in Poland, the work of a tiny minority--to become a mass movement. From Berlin to Bucharest the people suddenly entered the stage proclaiming their rejection of "really existing socialism."

But they did not stay on that stage for long. Euphoria soon gave way to disenchantment. Eastern Europeans envisioned capitalism as a cornucopia of consumer goods as well as freedom. But they soon discovered that really existing capitalism meant a drop in living standards, rising unemployment, reduced social benefits and growing inequality. Once the Communist regimes collapsed, they were replaced by nineteenth-century capitalism applied with Thatcherite ruthlessness. Elaborated in Washington and sponsored by the International Monetary Fund, the treatment, known as shock therapy, was applied in varying degrees and with differing success throughout the region.

If the purpose of the operation was to destroy the old order, then it worked. Under the combined impact of the official offensive, the wild forces of the market and foreign competition, the decrepit state sector crumbled. By now more than 80 percent of the national product in Hungary and the Czech Republic is from the private sector, and Poland is not far behind. But a political price had to be paid for this full conversion to classical capitalism. The people, who had expected to have a choice between the Swedish and the West German models but were offered a Latin American future instead, did not like it. The unbelievable happened. The Communists, who in 1989 were spectacularly cast into the dustbin of history, were returned to office in a free election--in Poland in 1993 and in Hungary a year later, admittedly dressed now in Social Democratic clothing. To make matters more complicated, since what they were interested in was power and privilege, not ideology, their conversion to capitalism was genuine; their policy did not greatly differ from that of their predecessors, and a few years later, they were out of office, the pendulum swinging back to the right.

The results of shock therapy varied greatly from country to country. In Russia it has proved a total disaster. In Eastern Europe, where the Stalinist system had been imposed from above and from outside, the restoration of capitalism was less difficult. Yet even in Poland, where the gross national product was 16 percent higher last year than it was in 1989, for the bulk of the people it was quite a painful tale. It took seven lean years, with belts tightened and unemployment in two-digit figures, for national output to recover its pre-1989 level. And benefits, even now, are unequally distributed. The countries of Eastern Europe, which under Communism had a smaller gap between top and bottom incomes than their Western European counterparts, now have a bigger one and are approaching the American model.

Money plays an increasing role in housing, health and education. In Poland, the industrial workers from the big plants, who were the backbone of Solidarity, feel they have been cheated out of their victory by their own leaders. The peasant farmers, still accounting for more than one-fifth of the labor force, who saw in capitalism a guarantee of their property rights, now perceive Poland's possible admission to the European Union as a serious threat to their very survival. All those social tensions in a country cited as a success story show that conversion to capitalism is a much more painful operation than its panegyrists pretend.

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