On October 1, 1949, Mao Zedong, leader of the CPC, proclaimed the founding of the People’s Republic of China in Beijing. Chiang Kaishek took refuge in Taiwan, where permanently claimed the reestablishment of the Guomindang government and until now, is the unique part of China that is not beyond the control of the Communist government.
The new Communist government had to deal with an economic mismanagement and over a century of wars. Almost all China's road and rail network were destroyed, industrial output had slumped, extensive agricultural areas had been abandoned and monetary reserves where insignificant. But the Chinese people assumed the challenge of taking the country forward. By the mid-1950s, with all industry nationalized and land handed over to the peasants as their own, output had an important increased.
During the Mao era, millions of former landlords, communist dissident and political rivals were executed. A new system of education based on Marxism was imposed in order to preserve the revolution. The long period of Western imperialist involvement in China ended. Some regions returned to the Chinese control including Tibet (1951) and Xinjiang in western China.
China established pacts with the nations of the rising Socialist bloc, especially with the Union of Soviet Socialist Republics. The CPC participated in the Korean War (1950-1953), where Chinese troops aided the Communist regime of North Korea against South Korean and United Nations forces. China also aided the Communist uprising against France in Vietnam.
By 1956 China's economy was relative healthy. Mao felt that both government and industry needed to be stimulated to reach a great economic explosion. To this end, in 1957 he decided to repeal the restrictions on public expression to permit to intellectuals voicing their thoughts and complaints. But the plan failed: the campaign known as The Hundred Flowers, resulted in strong attacks to the Communist system and Mao himself. A new anti-rightist campaign confined to jail or killed the people who had criticized the Communism government and Mao implanted more severe restrictions.
In 1958 Mao announced the ambitious project of the Great Leap Forward: 5 hundred million peasants were moved to over 24,000 communes in an unprecedented process of collectivization in rural areas, with the aim of turning small-scale farming units into hyper-efficient agricultural areas; while other peasant had to abandon their agricultural labor to increase the steel production, according Mao's belief that a huge steel production would permit to construct heavy industrial plants, dig canals and drain marshes, but the poor quality of the steel transformed this project into a tragic reality.
The inefficient administration of production had caused that large amounts of crops were lost as the same time that bad weather and the end of Soviet economic aid converted the Great Leap into a great famine with millions of people death. After the disaster, Mao renounced to the presidency, but he always maintained the ideological leadership of the party with great influence on the affairs of state. The principal administrative charges of the country were assumed by Liu Shaoqi and Deng Xiaoping. By the mid-1960s the country was bankrupted although propaganda campaigns had assured perpetual well-being in return for initial hard work and austerity.
In 1966 Mao sought to recoup his authority with the support of Lin Biao, Defence Minister, who in 1964 had formed the Socialist Education Movement. Mao initiated the Cultural Revolution in order to impose socialist orthodoxy and liberate China from old customs and traditions.
Under Mao's direction, a group of students from Beijing organized themselves into a political militia - the Red Guard. Within weeks the Red Guard had taken the streets. Academics were humiliated, books were burned, temples and ancient monuments were desecrated. Shops with foreign stuff were destroyed. With the police and army forbidden to intervene, thousands of innocent people were ostracized, imprisoned, beaten to death or driven to suicide including prominent political leaders, like Liu and Deng. By August 1967 the violence was out of control, with rival Red Guard factions turning on each other. Mao had to intervene ordering the arrest of the most fanatical Red Guard leaders and instructing the surrender of all weapons to the army.
One effect of the Cultural Revolution was the rise of a personality cult surrounding Mao Zedong which image reached quasi-religious status.
In 1964 China exploded its first atomic bomb, taking it into the league of nuclear. United States launched an era of mutual collaboration with China taking advantage of the breakdown between China and the Soviet Union known as ping-pong diplomacy. In 1971 the People's Republic became the official representative of the nation called China, disregarding Taiwan's claims.
The following year US President Richard Nixon traveled to China and met with Mao. Trade restrictions were eliminated and China began commerce with the West and many other nations transferred their diplomatic recognition from Taiwan to the mainland CPC government. In 1972 China restored diplomatic relations with Japan. This drastic reform derived from the great ideological work of Premier Zhou Enlai.
In July 1976 a terrible earthquake in northern China killed almost half a million people. Only two months later Mao died and began a new era for China.