The close-knit symbiosis between Throne and Altar known as "Caesaro-Papism" characterized virtually all states throughout ancient history, from the Egyptian Pharaohs who reigned as living incarnations of the god Horus, to the Athenian Democracy which executed Socrates for impiety, to the Roman imperial cult of Sol Invictus, to the literal Caesaro-Papism of the Byzantine Empire.
The first great sundering of the historic partnership of Altar and Throne began with the fall of Rome in the west. The Papacy managed to survive in Rome even after the Empire had died out in the west, and managed to hold sway over the hearts of many converted barbarians, largely through the efforts of men like Gregory the Great. The Papacy used this sway to play off ruler against ruler and to thus maintain a great deal of independence in spite of its diminutive temporal power.
It eventually was able to become dominant in Europe. The moment that perhaps inaugurated its dominance was when Holy Roman Emperor Henry IV trekked barefoot to the Castle of Canossa in Italy in a hair-shirt to beg Pope Gregory VII to lift his excommunication. In humbling the emperor, the Pope instituted the Papal Monarchy and heralded the Res Pulica Christiana of the High Middle Ages.
But this Papal Monarchy did not go on to become an empire. The Church was powerful and independent enough to counter and limit the power of European monarchs, but not enough to become a full Europe-wide state itself. The fragmentation of power that the church imposed upon Catholic Europe emboldened nobles and clerics against kings, lesser nobles against greater nobles, and peasants and burghers against lords.
This unprecedented breakdown of Caesaro-Papism set Catholic Europe on a course widely divergent from the rest of the world. Caesaro-Papism and the despotism it made possible persisted in medieval and early modern times throughout the east, even including Orthodox Russia and Byzantium. It is the history of political fragmentation shared by all of Catholic and post-Catholic Europe and its colonies that most distinctly sets "the west" apart from the rest of the world. The Magna Carta, signed in 1215 in Runnymede was a check on royal power that was most characteristic of this relatively free age.
The relative freedom made possible by political decentralization led to the industrial and commercial revolution of the high middle ages which is egregiously ignored by contemporary popular history. During the middle ages, water and wind mills peppered Europe like never before. The increased energy thus harnessed and its automaticity had an explosive effect on productivity. Cereals grains were processed with unprecedented efficiency. The greater heat of medieval furnace technology initiated the true iron age, during which quality iron was available for widespread use for the first time. There were huge improvements in agricultural technique, including in field rotation. The medieval harness unleashed the motive power of the horse in agriculture, which dramatically increased productivity. Scientific husbandry at monastery sheep farms led to an explosion in wool productivity. All this happened, and much much more.
Unfortunately, 70 years after Runnymede, European saw the coronation of a monarch who would prove to be the herald of an age of absolute monarchy. Philip IV of France (known as "the Fair" for his good looks) committed a wide number of atrocities (bringing on the Hundred Years War, expropriating and expelling the French Jews, expropriating and murdering the Knights Templar, imposing crippling taxes on the vitally important fairs of Champagne). But the most significant of these was his arrest of Pope Boniface VIII in 1303.
As the culmination of an intense power struggle between the King and the Pope (particularly over the king's desire to tax the clergy), Boniface excommunicated Philip. Philip responded by sending two thousand mercenaries to the Papal palace at Anagni. The mercenaries plundered the palace, and captured the Pope, nearly murdering him. Although rescued by locals, the Pope developed a fever shortly after this incident, and died. Within a few years, the Papacy was relocated to Avignon, a French-dominated territory, and was relegated to slavishly generating moral authority for the French crown by rubber stamping its atrocities. Just as the humiliation of a monarch at the hands of a Pope at Canossa signaled the beginning of an age of relative freedom and prosperity, so did the humiliation of a Pope at the hands of a monarch at Anagni ring that age's death knell.