How Capitalism Was Built: The Transformation of Central and Eastern Europe, Russia, and Central Asia

In the 15 or so years after the end of the Cold War, vast economic changes rippled through the Warsaw Pact countries. Aslund chronicles the sometimes unsteady transition from centrally planned economies to market based approaches. Much had to be done. Privatisation was fundamentally different from what happened under that label in the existing capitalist countries. The latter always had strong private sectors. But in the countries surveyed here, privatisation in some cases meant selling off most of a country. Difficult issues of how to “spin off” housing, land and commercial real estate.

The rise of the Russian oligarchs gets an entire chapter. Explaining how in the Russian rush to privatise, a few nimble men (and they were all men) managed to acquire vast assets from the state. For the most part, they were able to parlay these into huge conglomerates, and sidestep troublesome questions of fairness.

Interesting comparisons are made to the robber barons of the US in the late 19th century. One key difference is that the oligarchs are proved unable to resist Putin’s assertion of centralised rule. While in the US, the barons were able to largely hold off Washington for decades.

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