This article gives an analysis of the political economy of transformation which stresses the major achievements of some countries, the fact that the transformation is not yet over, the existence of both winners and losers, and the limitations of transition orthodoxy. Attention is paid to the implications of transformation up until now for social philosophy and the Washington Consensus. It is argued that among the surprises of transformation were the importance of a sound banking system, of a strong, but limited, state, and the fact that transformation is a long and difficult process. In addition, the initial stress on the need for rapid privatization turned out to be one-sided. More important for the resumption of economic growth is the development of new private firms. There are political dangers on the road ahead which, for the successful applicants, will be reduced by EU membership.