Despite dramatic increases in poverty, unemployment, and social inequalities, the Central and Eastern European transitions from communism to market democracy in the 1990s have been remarkably peaceful. This book proposes a new explanation for this unexpected political quiescence. It shows how reforming governments in Poland, Hungary and the Czech Republic have been able to prevent massive waves of strikes and protests by the strategic use of welfare state programs such as pensions and unemployment benefits. Divide and Pacify explains how social policies were used to prevent massive job losses with softening labor market policies, or to split up highly aggrieved groups of workers in precarious jobs by sending some of them onto unemployment benefits and many others onto early retirement and disability pensions. From a narrow economic viewpoint, these policies often appeared to be immensely costly or irresponsibly populist. Yet a more inclusive social-scientific perspective can shed new light on these seemingly irrational policies by pointing to deeper political motives and wider sociological consequences. Divide and Pacify contains a provocative thesis about the manner in which political strategy was used to consolidate democracy in post-communist Hungary, Poland, and the Czech Republic. Pieter Vanhuysse develops a tight argument emphasizing the strategic use of welfare and unemployment compensation policies by a government to nip potential collective action against it in the bud. By breaking up social networks that might otherwise facilitate protest, through unemployment and induced early retirement, governments were able to survive otherwise difficult economic circumstances. This novel argument linking economics, politics, sociology, and demography should stimulate wide-ranging debate about the strategic uses of social policy.