From 1945-1989, the city of Berlin was the dividing line between two hostile camps.
West of Berlin lay a coalition of capitalistic liberal democracies spearheaded by the United States – to the East laid a string of communist totalitarian dictatorships dominated by the Soviet Union.
When exactly modern capitalism emerged is a subject of academic debate, but by the beginning of the industrial revolution the most advanced economies in Europe began to transition away from government-backed mercantilist monopolies and towards private ownership of major business enterprises. The expansion of private enterprise was concurrent with a philosophical movement known as the Enlightenment, which emphasized the importance of individual reason and insisted that people could and should make important decisions for themselves rather than being dictated to by a central authority.
These ideas were associated with the rise of scientific rationalism and political liberalism, and the inchoate elements of this new capitalistic model were most pronounced in areas such as Great Britain and the Netherlands, both of which began to experiment with forms of representative democracy. While the system had been acted out to varying degrees for decades or centuries, the theoretical underpinnings of capitalism would be codified in 1776 by Scottish economist Adam Smith in “An Inquiry into the Nature and Causes of the Wealth of Nations.” Among other things, it observed that wealth was not a fixed quantity and competition was not a zero-sum game.
“Nobody ever saw one animal by its gestures and natural cries signify to another, this is mine, that yours; I am willing to give this for that. … But man has almost constant occasion for the help of his brethren, and it is in vain for him to expect it from their benevolence only. He will be more likely to prevail if he can interest their self-love in his favour, and show them that it is for their own advantage to do for him what he requires of them. Whoever offers to another a bargain of any kind, proposes to do this. Give me that which I want, and you shall have this which you want, is the meaning of every such offer; and it is in this manner that we obtain from one another the far greater part of those good offices which we stand in need of.” -Adam Smith, “The Wealth of Nations”
The simple observation that self-interested people, when left to their own devices, will seek out mutually beneficial arrangements to provide the many necessities of life to the best of their ability, would turn out to be a decisive turning point in human history, as more and more people were afforded the freedom to do exactly that.
“The Wealth of Nations” remains the foundational text for modern economics and is the second most cited source in the social sciences written before 1950.
The most cited source in that category is “Das Kapital” by Karl Marx.
Compared to capitalism, communism has much more definite origins: “socialism” emerged into the intellectual vernacular during the 1830s and referred to a variety of collectivist moral and economic theories that were largely negative reactions to prevalent modes of private enterprise. Alexandre Vinet, the man who claimed to have first used the term, succinctly described it as “the opposite of individualism.”
While in a generic sense “socialism” refers to any system or ideology that advocates for the “collective ownership of the means of production” the most consequential variant would be exposed by Karl Marx and his collaborator Friedrich Engels, first in their “Communist Manifesto,” published in 1848, and later in agonizing detail “Das Kapital,” a lifelong project that was only completed after Marx’s death in 1883.
While Marx and Engels praised capitalism for its destruction of feudalism and its economic dynamism, they also excoriated it for its uneven distribution of wealth. While capitalism had inarguably created more material prosperity it had also, in their view, created gross inequalities and left the average man alienated from the fruits of his labor, as nothing more than a cog in the machine.
Marxist theory viewed capitalism as fundamentally unstable — it argued that all economic value was derived from labor, and that capitalists grew rich by expropriating a share of that value via exploitation. The fierce competition between capitalists for their ill gotten gains would drive more and more people into the alienated working classes as wealth and power accrued in the hands of a smaller and smaller group. The rich would get richer and the poor would get poorer until the working class, conscious of its own oppression, unified and overthrew their masters to usher in a new “dictatorship of the proletariat.”
“Scientific socialism” as Marx called it, was not merely a moral critique of capitalism but an all-encompassing theory of the social sciences. It held that human societies progress down a predictable path of development, through definite stages defined by class struggle and punctuated by revolutionary change.
“The history of all hitherto existing societies is the history of class struggles. Freeman and slave, patrician and plebeian, lord and serf, guild-master and journeyman, in a word, oppressor and oppressed, stood in constant opposition to one another, carried on an uninterrupted, now hidden, now open fight, a fight that each time ended, either in a revolutionary re-constitution of society at large, or in the common ruin of the contending classes.” -Karl Marx and Friedrich Engels, “The Communist Manifesto”
The transition from feudalism to capitalism was one such change; capitalism to socialism would be another. Socialism itself was merely a transitional stage to the end of human history, communism: a classless, stateless society where property would be held in common and all would provide for all. “From each according to his ability, to each according to his need.”
Marx’s theory would become increasingly in vogue over the next 100 years and remains influential in academic circles to this day, but despite his predictions the socialist revolution would not begin in the most industrialized nations — Germany, Britain, the United States — but instead in the feudal backwater of Russia.
Russia was only beginning to industrialize and had been utterly thrashed in World War 1, so much so that a group of Marxist radicals were able to seize power in late 1917, after all other Russian institutions had been discredited and its people had been sufficiently demoralized. Over the following decades, tens of millions of Russians would die in civil wars, political purges, and government-induced famine as the first Marxist experiment ran its course.
In Europe, however, other socialist experiments were also taking root. After World War 1, a disaffected Italian Marxist named Benito Mussolini would break with the international sensibilities of orthodox Marxism and advocate for a new socialism: a national socialism. A totalitarian collectivist regime would be instituted in the name of race and nation, not class.
Fascism, as it would be called, was acted out before it was fully articulated — Mussolini would seize power in 1925, while “The Doctrine of Fascism” which he co-wrote alongside philosopher Giovanni Gentile, would not be published until 1932, although there were premonitions of it in various schools of authoritarian nationalist thought across Europe in the previous decades.
“Liberalism denied the State in the name of the individual; Fascism reasserts the rights of the State as expressing the real essence of the individual. And if liberty is to be the attribute of living men and not of abstract dummies invented by individualistic liberalism, then Fascism stands for liberty, and for the only liberty worth having, the liberty of the State and of the individual within the State.” -Benito Mussolini and Giovanni Gentile, “The Doctrine of Fascism”
The National Socialists of Germany would rise to power in 1933, and incorporated many of the same ideas, although they would make virulent race hatred a much larger part of their program and their form of fascism was much more nakedly genocidal.
On the eve of the Second World War, Europe was divided into three hostile camps — the liberal capitalists in the west, the national socialists in the center, and the international socialists in the east. By the war’s end, that number would be whittled down to two.
Nazi Germany and Soviet Russia began the war as tentative allies, each carving off a piece of western aligned Poland, but each felt that their worldviews were ultimately incompatible; both knew that this was merely a pragmatic delay to an inevitable clash. That clash would commence in June of 1941, when the Nazis launched a surprise invasion of Soviet territory in the largest military operation in history. The Nazis would penetrate deep into Soviet territory and at their furthest advance came within ~10 miles of Moscow, but with the aid of allied materiel and the monumental sacrifices of Soviet soldiers and civilians, the Nazi invasion would be repulsed, at the cost of over 20 million lives.
By 1943, the Nazis began their long retreat from Soviet territory — by the middle of the year Italy had been invaded and Mussolini deposed from power. On June 4, 1944, the forces of the United States and the British Empire established a beachhead at Normandy in Nazi-occupied France and began their liberation of occupied Europe. The allies would continue their advance until their armies converged and the Nazi regime collapsed in May 1945.
Germany was divided into four occupation zones — controlled by the Americans, British, French, and Soviets. Berlin, the capital, was in the Soviet zone but was likewise partitioned between the Allied Powers.
While the Soviets and the Western Allies had briefly united to defeat their fascist enemies, their own ideologies were equally incompatible and once the common threat had been vanquished tensions between them began simmering once more. There had been talk of holding free elections across liberated Europe after the end of the war, but the Soviets quickly installed puppet regimes across their occupation zone in Eastern and Central Europe.
Their motive was partly ideological and partly pragmatic.
Ideologically, communism was still dedicated to the creation of a worldwide worker’s paradise and the overthrow of the bourgeoisie — the opportunity to establish communist governments across large swaths of Europe was too tantalizing to pass up.
Geographically, however, the Great European Plain that covered much of the north of the continent provided few natural defenses against invasion, and effectively acted as a funnel from Western Europe right into the heart of Russian territory. Napoleon had marched an army into Russia along that exact route in the 19th century, and the Nazis had followed his example in the 20th. Demilitarizing Germany and breaking it up into East and West would go some way to assuaging Soviet fears of another land invasion, but a series of satellite states acting as buffers between the West and the Soviet heartland was additional insurance.
The Western Allies were unenthused, to say the least, but neither side was willing to go to war over the issue so soon after the unprecedented carnage of World War 2.
This general fatigue was compounded by a new weapon of terrifying power — the atomic bomb. The United States had developed the first nuclear weapons, capable of leveling cities in a single shot, in a race against similar programs in Nazi Germany. By 1945, these weapons were fully operational, and were deployed against the sole holdout among the Axis Powers, Imperial Japan, devastating the cities of Hiroshima and Nagasaki. The bombings broke the will of Japan’s military government, but they also may have been meant to intimidate the Soviets by displaying the awesome power of America’s new arsenal.
Unbeknownst to the Americans, Soviet spies had already infiltrated the Manhattan Project that developed the bomb, and passed on crucial intelligence that would accelerate their own atomic research.
In the meantime, tensions in Europe began to rise. Wary of capitalist influences in Soviet-controlled East Germany, in 1948 the Soviets attempted to eject the Western Allies from the divided capital by establishing a blockade on the ground. British and American air forces circumvented the blockade and dropped over two million tons of supplies into Berlin over the course of 15 months, until the Soviets relented and ground access was re-established. While the incident did not escalate to full blown military conflict, it did heighten tensions between the two emerging superpowers.
In April of 1949, the United States and its allies in Canada and Western Europe created the North Atlantic Treaty Organization as a defensive alliance against further Soviet aggression. In August of 1949, the Soviets would complete their first nuclear tests, breaking the American monopoly on the atomic bomb and raising the stakes of a potential conflict exponentially.
For the first time in human history, all-out war between the major powers would be apocalyptic in scope — nuclear blasts could annihilate most major population centers in a matter of hours, and the subsequent radiation could contaminate the surrounding countryside for months or years.
Open conflict was thus unacceptable to both capitalist and communist leaders — both ideologies were anathema to one another but neither stood to gain from a nuclear exchange. Instead, the competing superpowers would spend the better part of the next four decades in a Cold War, building up their arsenals and backing rival governments in a series of proxy wars scattered across the globe.
The division was perhaps most acutely felt in Germany, vanquished and divided by the former allies, where the chance division of a city block separated friends and family into different worlds. The legal division would become physical in 1961, when the government of East Germany erected the Berlin Wall to prevent impoverished East Germans from fleeing into the more prosperous West.
Winston Churchill, the prime minister who led Britain through its darkest days, and foresaw the threat of Nazism long before it came to pass, was likewise prescient in describing the coming decades. As early as 1946, he noted that “An iron curtain has descended across the Continent.”
The specter of armageddon came with it.
WATCH: The Cold War: Part 1, An Iron Curtain