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Brief History of China
  • In the Beginning... Xia (c. 2200 - c. 1750 BC)
Not much is known about this first Chinese dynasty -- in fact, until fairly recently, most historians thought that it was a myth. But the archeological record has proven them wrong, for the most part. What little is known indicates that the Xia had descended from a wide-spread Yellow River valley Neolithic culture known as the Longshan culture, famous for their black-lacquered pottery. Even though no known examples of Xia-era writing survive, they almost certainly had a writing system that was a precursor of the Shang Dynasty's "oracle bones." 
  • Shang (c. 1750 - c. 1040 BC)
There are three things to know about the Shang. One, they were the most advanced bronze-working civilization in the world. Two, Shang remains provide the earliest and most complete record of Chinese writing C (there are a few Neolithic pots that have a few characters scratched on them; however, a few characters do not make a complete writing system C scratched out on the shoulder blades of pigs for oracular purposes. And three, they were quite possibly the most blood-thirsty pre-modern civilization. They liked human sacrifice -- a lot. If a king died, then more than one hundred slaves would join him in the grave. Some of them would be beheaded first. Some of them were just thrown in still alive. Later dynasties replaced the humans with terra-cotta figures, resulting in things like the underground army. They also did things like human sacrifice for building consecrations and other ceremonial events. The Shang had a very odd system of succession: instead of a patrilineal system where power was passed from father to son, the kingship passed from elder brother to younger brother, and when there were no more brothers, then to the oldest maternal nephew. 
  • Western Zhou (c. 1100 - 771 BC)
Most scholars think that the Zhou were much more "Chinese" than the Shang. For one, they used a father-to-son succession system. Also, they weren't too keen on human sacrifice. However, they weren't as good at working bronze as the Shang. Still, it would be centuries before the West was able to cast bronze as well as the Zhou. Some, though not all, scholars believe that the Xia, the Shang, and the Zhou actually were three different cultures that emerged more or less at the same time in different areas of the Yellow River valley. And the historical record supports this view -- the Shang were conquered from outside by the Zhou, as the Xia had been conquered from the outside by the Shang. 
The Zhou actually didn't rule all of what was then China. China was then made up of a number of quasi-independent principalities. However, the Zhou were the most powerful principality and played the role of hegemony in the area. They were located in the middle of the principalities, giving rise to what the Chinese call their country -- the Middle Kingdom. The Zhou were able to maintain peace and stability through the hegemony system for a few hundred years; then in 771 BC, the capital was sacked by barbarians from the west. 
  • Eastern Zhou (771 - 256 BC) Spring & Autumn Period (722 - 481 BC) Warring States Period (403 - 221 BC)
After the capital was sacked by barbarians from the west, the Zhou moved east, thus neatly dividing the Zhou dynasty into eastern and western periods. As might be expected, the power of the Zhou declined somewhat. The so-called Spring & Autumn period, named after a book (The Spring and Autumn Annals) that provides a history of period saw a proliferation of new ideas and philosophies. The three most important, from a historical standpoint, were Daoism, Confucianism, and Legalism. 
Daoism can be a very frustrating philosophy to study. It is based on study of the Dao, literally translated, "the Way." For starters, the oldest great book of Daoism, the Dao de Jing, The Way and Virtue, was allegedly written by a man named Lao-zi. However, we don't know 1) if Lao-zi was his real name, 2) if Lao-zi ever actually existed, and 3) if the book is even the work of one author. Then there are the texts themselves. The first line of the Dao de Jing can be translated as "The Way that can be walked is not the enduring and unchanging Way." It can also be translated as "The Way that can be known is not the true Way," as well as several other translations that, while all having the same general paradoxical meaning, are all different. It is also full of other cryptic and paradoxical sayings, like "The more the sage expends for others, the more does he possess of his own; the more he gives to others, the more does he have himself." Daoists loved this kind of stuff; the story about the man dreaming he was a butterfly, then waking up and wondering if he was a man or a butterfly dreaming about being a man is classic Daoism. Daoism profoundly influenced the later development of Cha'an (also known as Zen) Buddhism. 
Confucius, who lived about five hundred years before Christ, basically believed that moral men make good rulers and that virtue is one of the most important properties that an official can have. He also believed that virtue can be attained by following the proper way of behaving, and thus placed a great deal of stress on proper. Most of what is considered 'Confucianism' was actually written down by a disciple named Mencius, who also believed that all men were basically good. Confucius also codified the status of the ruler in Chinese political thought; the Emperor was the Son of Heaven (while Heaven in a Western context is a place, Heaven in the Chinese context is a divine/natural force) and had the Mandate of Heaven to rule. 
Legalism derived from the teachings of another one of Confucius' disciples, a man named Xun-zi. Xun-zi believed that, for the most part, man would look out for himself first and was therefore basically evil (remember, this is more than two thousand years before Adam Smith argued that self-interest is what makes markets work and is therefore good). Consequently, the Legalists designed a series of draconian laws that would make a nation easier to control. The fundamental aim of both Confucianism and Legalism was the re-unification of a then divided China, but they took different approaches. Confucianism depended on virtue and natural order; Legalism used an iron fist. Legalism has been called "super-Machiavellian;" this is not unwarranted, as it called for the suppression of dissent by the burning of books and burying dissidents alive (maltreatment of the opposition is nothing new in China; because the system starts with the idea that the Emperor is the Son of Heaven and has the Mandate of Heaven to rule, there is no such thing as legitimate dissent and thus no concept of "loyal opposition"). Legalism advocated techniques such as maintaining an active secret police, encouraging neighbors to inform on each other, and the creation of a general atmosphere of fear.
The politics of the Warring States period were much the same as those of the Spring & Autumn period; the major difference was that while in the earlier period, armies were small and battles lasted only a day, much like in pre-Napoleonic wars, the later period featured what modern strategists would call "total war." Massive armies (half a million per army was not an uncommon figure), long battles, sieges, were all common features of the Warring States battlefield. 
  • Qin (221 - 206 BC)
  In 221 BC, the first Emperor of China (so-called because all the previous dynastic heads only called themselves kings), Qin Shihuangdi, conquered the rest of China after a few hundred years of disunity. There are two major reasons why he won; the first is that he was a devout Legalist (so much so that he burnt all [at least what he thought were all] the books in the country) and did things like execute generals for showing up late for maneuvers (this was later to prove to be his downfall). The other reason is because the state of Qin had a lot of iron, and consequently, at the dawn of the iron age, had many more iron weapons than the other armies did. Qin Shihuangdi had a great many accomplishments, not the least of which was the linking together of many of the old packed-earth defensive walls of the old principalities into the Great Wall of China. This is not to say that he built the massive masonry construction that today is called the Great Wall of China; what is today called the Great Wall was actually built close to two thousand years later, during the Ming dynasty.  

The Tomb of Emperor Qin Shihuang
In the year 210 BC Qin Shihuangdi died. It wasn't long before the dynasty fell apart, helped in part by a revolution started by a soldier who, when faced with execution because he was going to be late delivering a group of new draftees (it had been very rainy and the roads had turned to mud), convinced his conscripts to rebel with him (they faced execution as well). And while they eventually were caught and duly executed, the revolution they started ended up destroying the old dynasty and set the stage for the Han. 
  • Earlier Han (206 BC - AD 8) Wang Mang Interregnum (AD 8 - 25) Later Han  (25 - 220)
The Han dynasty plays a very important role in Chinese history. For starters, they invented Chinese history as we know it today. Additionally, the overwhelmingly predominant ethnic group in China is called the Han; they are named after the dynasty. But, most importantly, they developed (actually, it was invented by Qin Shihuangdi, but perfected by the Han) the administrative model which every successive dynasty would copy, lock, stock, and barrel.  

Palace Lantern of Han Dynasty (206 BC-220AD)
Why is the development of bureaucracy so important? Well, first of all, because ancient China was a big country. In 206 BC, when the Han dynasty was founded, China stretched from modern Shenyang (some 500 km north of Beijing) in the north to around Guilin in the south; from the Pacific in the east to well past Chongqing in the west. Until Russia laid claim to Far East Siberia, China was the largest country in the world. It was also the most populous (60 million people at the time), and still is (however, India will probably overtake China in terms of population some time early in the 21th century). This is a management issue of tremendous proportions. How are you going to do things like collect taxes, keep the peace, and basically run a government without bureaucracy? The Chinese bureaucratic system is based on the study of the Confucian Classics, which provide an ideological reference point for proper behavior (which was often ignored, but it worked well enough) and loyalty to the Emperor. By developing this system, the Han emperors were able to run China with a reasonable degree of efficiency.
During the reign of an emperor named Han Wudi lived a historian named Sima Qian. His most important contribution to Chinese history was that he wrote a book known as Records of the Grand Historian (actually, he claimed to just be completing a book that his father, Sima Tan, had started, but most of the book is Sima Qian's). Most history books are very linear: first you talk about the Greeks, then the Romans, then the Dark Ages, and so on. What Sima did was structure his book so that each chapter covered a different topic: one chapter was a political record of the kings and emperors; the next would cover literature; the third, philosophy, and so on. Every dynastic record that followed copied Sima's original. Actually, there is an English-language history of China that loosely follows this model; it's called China's Imperial Past, written by Charles O. Hucker.
Between AD 8 and 25, a man named Wang Mang ruled China. He had been part of the Han royal household; he himself, however, was a commoner and had no royal blood in his veins. He had been appointed emperor after a power struggle in the Han house. History is mixed on him. While he did seem to have some good, reform-oriented ideas (e.g. power back to the people), he really wasn't up to the task of ruling. After his death in AD 25, the Han royal family took back the reins of power, and set up the Later Han dynasty.
The later Han were able to keep it together for about 200 years; however, towards the end of their rule, they become more and more dissolute. More importantly, they were unable to deal with two factors: a population shift from the Yellow River in the north to the Yangzi in the south; and they simply could not control barbarian tribal raiders from the north, which were one reason why people were moving to the south. Eventually, in AD 220, the center had lost so much control to the provinces that it collapsed (a small rebellion in the north helped), plunging China into 350 years of chaos and disunity.
  • Three Kingdoms (220 - 265)  Dynasties of the North and South  (317 - 589)
While there was a great deal of political activity occurring during this period, most of it, consisting as it was of various wars between different kingdoms (one of the great novels of China, The Romance of the Three Kingdoms, is about this period), was not terribly important to the later development of China. Perhaps its greatest accomplishment was to reinforce in Chinese thought the importance of having "one Emperor over China, like one sun in the sky."
Socially, though, there were two important developments. The first was that the ethnic Han Chinese kept on moving south, while 'barbarians' moved into the north and assimilated themselves into Chinese society. The second development was Buddhism, which had had its start in India sometime in the 6th century BC, when the Buddha probably lived. It was introduced into China around the middle of the first century AD (probably about the same time that the early Christians were writing the Gospels), but really didn't catch on until the fall of the Han dynasty.
Buddhism competed strongly with Confucianism, and for a long time, pretty much eclipsed it as a major cultural force. For various reasons -- some political, some social -- it spread very quickly throughout China. It also changed somewhat from the Indian original, which, as far as I know, is not practiced anymore anywhere in the world. From China, Buddhism would spread into Tibet, Southeast Asia, Korea, and Japan.
Buddhism also merged somewhat with Daoism, particularly as a popular religion; and while the process may be compared to Christianity's appropriation of indigenous European beliefs and traditions, Daoism maintained its own identity and was not subsumed into popular Buddhism. 
  • Sui (589 - 618)
The most important thing to know about this dynasty is that it was very short (by dynastic standards) and that it did a pretty good job of re-unifying China. Because it had a northern power base, it was part barbarian, as was the Tang. Despite the fact that the royal houses of Sui and succeeding Tang were not entirely Han Chinese, both of these dynasties are considered to be Chinese, as opposed to the Mongols and Manchus later on.
  • Tang (618 - 907)
The Tang are considered to be one of the great dynasties of Chinese history; many historians rank them right behind the Han. They extended the boundaries of China through Siberia in the North, Korea in the east, and were in what is now Vietnam in the South. They even extended a corridor of control along the Silk Road well into modern-day Afghanistan.
There are two interesting historical things about the Tang. The first is the Empress Wu, the only woman ever to actually bear the title 'Emperor' (or, in her case, Empress).The second was the An Lushan Rebellion, which marked the beginning of the end for the Tang.
The Empress Wu was not a nice person. She makes Catherine the Great look like an angel of mercy. While Empress Wu was still a concubine in the imperial Tang household, she deposed of a rival by murdering her own son, and then claiming her rival did it. In her own vicious, ruthless, scheming way, she was absolutely brilliant. Had Machiavelli known of her, he probably would have written "The Princess."
The An Lushan Rebellion had its roots in the behavior of one of the great emperors of Chinese history, Xuanzong. Until he fell in love with a young concubine named Yang Yuhuan, he had been a great ruler, and had brought the Tang to its height of prosperity and grandeur. He was so infatuated with Yang that the administration of the government soon fell into decay, which was not made any better by the fact that Yang took advantage of her power to stuff high administrative positions with her corrupt cronies. She also took under her wing a general named An Lushan, who quickly accumulated power.
An Lushan eventually decided that he would make a pretty good emperor, and launched his rebellion. The civil war lasted for eight years, and was, for the years 755-763, pretty destructive. The emperor was forced to flee the capital, and on the way, the palace guard, blaming Yang Yuhuan for all the problems that had beset the dynasty (to be fair, it wasn't all her fault; there were forces of political economy at work that were pretty much beyond anybody's control), strangled her and threw her corpse in a ditch. There is a legend that what actually happened was that the emperor had procured a peasant look-alike who was actually the one killed, but as far as I know, that is only fiction. Anyway, the rebellion pretty much shattered centralized Tang control, and for the remaining 150 years of the dynasty, the country slowly disintegrated. 
  • Northern Song (960 - 1125)   Southern Song (1127 - 1279)  
The Song (pronounced Soong) dynasty ranks up there with the Tang and the Han as one of the great dynasties. Fifty years after the official end of the Tang, an imperial army re-unified China and established the Song dynasty. A time of remarkable advances in technology, culture, and economics, the Song, despite its political failures, basically set the stage for the rest of the imperial era. The most important development during the Song was that agricultural technology, aided by the importation of a fast-growing Vietnamese strain of rice and the invention of the printing press, developed to the point where the food-supply system was so efficient that, for the most part, there was no need to develop it further. There was enough food for everyone, more or less, the system worked, and it became self-sustaining. Because it worked, there was no incentive to improve it; the system thus remained basically unchanged from the Song up until the twentieth century. In fact, many rice farmers in the Chinese interior and in less-developed regions of Southeast Asia are, for the most part, still using Song-era farming techniques.
The efficiency of the system not only made it economically self-sustaining, but also re-enforced the existing social structure. Consequently, society and economics were largely static from the Song until the collapse of the dynastic system in the twentieth century.
This is important because one of the factors behind the Industrial Revolution in Europe was that they didn't have enough people to work the fields. There was an incentive to create better technology in Europe; there was no need in China. China actually had a surplus of human labor.
While the Song was a time of great advances, politically and militarily, the Song was a failure. The northern half of China was conquered by barbarians, forcing the dynasty to abandon a northern capital in the early 1100's. Then a hundred and fifty years later, the Mongols, fresh from conquering everything between Manchuria and Austria, invaded and occupied China. 
  • Yuan (Mongol) (1279 - 1368)  
While time of Mongol rule is called a dynasty, it was in fact a government of occupation. While the Mongols did use existing governmental structures for the duration, the language they used was Mongol, and many of the officials they used were non-Chinese. Mongols, Uygurs from central Asia, some Arabs and even an Italian named Marco Polo all served as officials for the Mongol government. One of the more significant accomplishments of the Mongol tenure was the preservation of China as we know it in that China wasn't turned into pastureland for the Mongolian ponies, which not only was common Mongolian practice for territories they'd overrun but had actually been advocated by some of the conquering generals.
The Yuan dynasty also featured the famous Khubilai Khan, who, among other things, extended the Grand Canal. While in many ways, the Yuan was a disaster, the reluctance of the Mongols to hire educated Chinese for governmental posts resulted in a remarkable cultural flowering; for example, Beijing Opera was invented during the Yuan. On the other hand, attempts to analyze the failure of the Song in keeping barbarians out China led to the rise and dominance of Neo-Confucianism, a notoriously conservative (if not outright reactionary) brand of Confucianism that had originally developed during the Song. 
  • Ming (1368 - 1644)  
Then came the Ming. The Ming rulers distinguished themselves by being fatter, lazier, crazier, and nastier than the average Imperial family. After the first Ming Emperor discovered that his prime minister was plotting against him, not only was the prime minister beheaded, but his entire family and anyone even remotely connected with him. Eventually, about 40,000 (no, that is not a misprint) people were executed in connection with this case alone. They were also virulent Neo-Confucianists.
In the early 1400s, a sailor named Zheng He (with a fleet of some 300-plus ships) sailed as far west as Mogadishu and Jiddah, and he may (or may not) have gotten to Madagascar. This is nearly 100 years before Columbus had the idea of trying to sail to Asia the long way around. But once the sailors came back, the trips were never followed up on. Conservative scholars at court failed to see the importance of them. For the first time in history, China was turning inwards, clinging to an incorrect interpretation of an outmoded philosophy. 
  • Qing (Manchu) (1644 - 1911)
In 1644, the Manchus took over China and founded the Qing dynasty. The Qing weren't the worst rulers; under them the arts flowered (China's greatest novel, a work known variously as The Dream of the Red Chamber, A Dream of Red Mansions, and The Story of the Stone, was written during the Qing) and culture bloomed. Moreover, they attempted to copy Chinese institutions and philosophy to a much greater extent than the Mongols of the Yuan. However, in their attempt to emulate the Chinese, they were even more conservative and inflexible than the Ming. Their approach to foreign policy, which was to make everyone treat the Emperor like the Son of Heaven and not acknowledge other countries as being equal to China, didn't rub the West the right way, even when the Chinese were in the moral right (as in the Opium Wars, which netted Britain Hong Kong and Kowloon).
To live during the Qing Dynasty was to live in interesting times. Most importantly, the Western world attempted to make contact on a government-to-government basis, and, at least initially, failed. The Chinese (more specifically, the ultra-conservative Manchus) had no room in their world-view for the idea of independent, equal nations (this viewpoint, to a certain degree, still persists today). There was the rest of the world, and then there was China. It wasn't that they rejected the idea of a community of nations; it's that they couldn't conceive of it. It would be like trying to teach a Buddhist monk about the Father, Son, and the Holy Ghost. This viewpoint was so pervasive that Chinese reformers who advocated more flexibility in China's dealings with the West were often accused of being Westerners with Chinese faces.  

"Banquet at Yingtai" by Zhang Hao (1736-1795)
Other problems that plagued the late (1840 onwards) Qing included rampant corruption, a steady decentralization of power, and the unfortunate fact that they were losing control on too many fronts at the same time. Rebellions sprouted like mushrooms after a rain; apocalyptic cults undermined what little official authority remained. Several of the rebellions, such as the Taiping Rebellion, very nearly succeeded. Compounding the problems was squabbling between various reformers who disagreed on how to best combat the chaos and the West (not necessarily in that order); in hindsight, it is clear that the entire system was slowly collapsing. An excellent account of this period is Frederic Wakeman Jr.'s The Fall of Imperial China.
The attitude of the Western powers towards China (England, Russia, Germany, France, and the United States, were, more or less, the primary players) was strangely ambivalent. On the one hand, they did their best to undermine what they considered to be restrictive trading and governmental regulations; the best (or worst, depending on your point of view) example of that was the British smuggling of opium into Southern China. Other examples included the 'right' for foreign navies to sail up Chinese rivers and waterways, and extra-territoriality, which meant that if a British citizen committed a crime in Qing China, he would be tried in a British council under British law. Most of these 'rights' came into being under a series of treaties that came to be known, and rightly so, as the Unequal Treaties.
On the other hand, they did do their best to prop up the ailing Qing, the most notable example being the crushing of the Boxer Rebellion in 1900 by foreign troops (primarily U.S. Marines). What the Western powers were interested in was the carving up of China for their own purposes, and that, paradoxically, required keeping China together.
But two things happened to prevent that. First, in 1911, the Qing dynasty collapsed and China plunged headlong into chaos. Second, in 1914, the Archduke Ferdinand told his driver to go down a street in Sarajevo he shouldn't have, and Europe plunged headlong into chaos. 
  • Republican China (1911- 1949 ) (Moved to Taiwan after 1949)
During World War I, the Chinese Government, such as it was, sided with the Allies. In return, they were promised that the German concessions in Shandong Province would be handed back over to the Chinese Government at the end of the war. They weren't, and to add insult to injury, the Treaty of Versailles handed them over to Japan. On May 4, 1919, about 3,000 students from various Beijing universities got together in Tiananmen Square and held a mass protest. The movement that was born at that rally (called, not unsurprisingly, the May Fourth Movement) was the first true nationalist movement in China and has consequently served as an inspiration for Chinese patriots of all shades, stripes, and ideologies since.
In the early 1920s, Dr. Sun Yat-sen, as the leader of the (up-to-then unsuccessful) Nationalist Party (KMT), accepted Soviet aid. With the Communist help, Sun Yat-sen was able to forge an alliance with the fledgling Chinese Communist Party (CCP), and started the task of re-unifying a China beset with warlords.
Unfortunately, Sun died of cancer in 1925. The leadership of the KMT was then taken over by Chiang Kai-shek.
After Chiang took over the KMT, he launched his famous "Northern Expedition" -- all the way from Guangzhou to Shanghai. This unified Southern China and, more importantly, let the Nationalists control the Lower Yangzi. Once they got to Shanghai, Chiang, who had never liked the Communists anyway, launched a massacre of CCP members. Among those who managed to escape the carnage was a young communist named Mao Zedong.
The Communists were forced to abandon their urban bases and fled to the countryside. There, the Nationalist forces (aided and abetted by German 'advisors') tried to hunt them down, and in the words (more or less) of Chiang, "eliminate the cancer of Communism." In 1934, the Nationalists were closing in on the Communist positions, when, under the cover of night, the Communists broke out and started running. They didn't stop for a year.
This was the Long March. When the Communists started, they had 100,000 people. A year later, when they finally stopped, they had traveled 6,000 miles, and were down to between four to eight thousand people.
Part of the problem is that they didn't know where they were going. They started in Jiangxi Province, about 400 km northeast of Guangzhou. Then they headed west, past Guilin, and into Yunnan Province, in southwest China. They would have stopped there, but the local warlords weren't really happy about having them. At Kunming, the capital of Yunnan Province, they turned north, past Chengdu in Sichuan Province, and eventually ended up in Shaanxi, near Yan'an. From then on, being a Long Marcher was the mark of aristocracy in the CCP. Deng Xiaoping, the former paramount leader of China, was a Long Marcher. With Deng's passing, there are few, if any Long Marchers left in the Party elite.
While in Yan'an, on the periphery of Nationalist power, Mao consolidated his position (gained during the Long March) as the sole leader of the Revolution. The classic book on this period is Edgar Snow's Red Star Over China, which includes some texts by Mao himself.
While all this was going on, the Japanese were busy occupying Manchuria. This proved helpful for the Communists -- the troops sent by Chiang to the North to contain and eventually eliminate the CCP much preferred to spend their time fighting the Japanese. In late 1936, Chiang's own generals kidnapped him and held him captive until he agreed to fight the Japanese before fighting the Communists.
In 1937, the Japanese invaded China proper from their bases in Manchuria, using the notorious "Marco Polo Bridge" incident as an excuse. Once whole-scale war had been launched, it didn't take the Japanese long to occupy the major coastal cities and commit atrocities. By the time that the war had ended in 1945, 20 million Chinese had died at the hands of the Japanese. The Nationalist Government fled up the Yangzi to Chongqing from Nanjing.
In 1939, World War II started. This initially had little effect on the situation in China, as the Japanese were not involved with war in Europe. However, after the attack on Pearl Harbor in 1941, the main thrust of the Japanese war effort turned away from fighting the Chinese and towards fighting the Americans.
After the Americans entered the war, the Communists started to consolidate their control over North China in preparation for the resumption of the civil war that would occur after the Japanese had been defeated. 
The Nationalists, in contrast to the Communists, were disorganized and corrupt, problems that would only intensify after the war. Moreover, their attempts to fight the Japanese were ineffective at best. The general in charge of US efforts inside China, General Stillwell, lobbied Washington (ineffectively) to channel some aid to the Communists; this was not because Stillwell was sympathetic to their cause but because the CCP, employing guerrilla tactics they had independently developed during the civil war, was simply doing a better job fighting the Japanese than the Nationalists.
At the end of World War II, the war between the Nationalists and the Communists started up again. The Communists were hampered by the fact that the Japanese were under orders to surrender only to the Nationalists, not the Communists. This, however, did not end up making much of a difference. By early 1949, the Nationalists were hamstrung by intractable corruption and huge debts; they paid off their debts by printing more money, which only led to hyperinflation.
By that October, the Nationalists had fled to Taiwan and Mao Zedong had proclaimed the creation of the People's Republic of China. Curiously, while the Red Army was busy re-unifying the south, they didn't bother re-unifying either Macau or Hong Kong, even though it would have been extremely easy, and neither Britain or Portugal would have been in much of a position to protest. 
  • The People's Republic of China (1949- )
In 1950, China intervened in the Korean War to save the North Koreans from being wiped off the map, and by 1953, the Korean War was over (actually, South Korea and North Korea are still technically at war with each other, even though the fighting stopped in 1953).
In 1958, Mao, who was growing increasingly distant from Moscow, launched the Great Leap Forward. The idea was to mobilize the peasant masses to increase crop production by collectivizing the farms and use the excess labor to produce steel. What ended up happening was the greatest man-made famine in human history. From 1958 to 1960, poor planning and bad management managed to starve 30 million people to death. Officially, the government blamed it on "bad weather."
By 1962, the break with the Soviets was complete, and China started to position itself as the 'other' superpower while it recovered from the Great Leap Forward. Unfortunately, in 1966, Mao launched the Great Proletarian Cultural Revolution. The origins of the Cultural Revolution are vague, but probably stem, in part, from a growing separation between Mao's clique and the rest of the CCP. Mao called upon students to rebel against authority, and they did, forming units of Red Guards. China promptly collapsed into anarchy. Schools shut down, offices closed, transportation was disrupted -- it was so bad that even today, the full history is still far from known. In terms of the chaos, blood, and destruction, it was comparable to the French Revolution, though it lacked the same political impact. At one point, Red Guards were fighting pitched battles with Government troops outside of the Foreign Ministry building. Later on in the Cultural Revolution, Red Guard units ended up fighting each other for supremacy. In the summer of 1967, there were massive riots in both Hong Kong and Macao.
One of the reasons why Mao was able to pull off something like the Cultural Revolution was because he was taking on the trappings of an emperor -- indeed, Mao himself often compared himself to the First Emperor of China. Another reason was the political support of the People's Liberation Army, spearheaded by a general named Lin Biao. During the glory years of the Cultural Revolution, Lin became very close to Mao, and was appointed his heir-apparent. Lin was also in charge of developing the 'cult of personality' around Mao. But after 1969, Lin's position began to deteriorate, and he vanished in 1971. Lin apparently died in an airplane crash in Mongolia; the official story is that he was fleeing to Russia. It is doubtful that the whole story will ever be told, particularly as the principles involved (Mao and Lin) have taken their secrets to the grave.

Mao and Lin
While the Cultural Revolution 'officially' ended in 1969, and the worst abuses stopped then, the politically charged atmosphere was maintained until Mao's death in 1976. Deng Xiaoping, who was purged twice during the Cultural Revolution (once at the beginning; once again right before Mao died); eventually emerged as the paramount leader in 1978, and promptly launched his economic reform program.
Deng's actions, initially limited to agricultural reforms, gradually started to spread to the rest of the country. One of his favorite sayings is "It doesn't matter if the cat is black or white; what matters is how well it catches mice." This is in direct contrast to the ideology of the Maoist years, where a favored slogan was "Better Red than Expert," which meant, in practice, that totally unqualified ideologues were put in charge of projects that really needed technical expertise.
In 1982 Margaret Thatcher, then Prime Minister of Britain, went to Beijing to meet with Deng Xiaopeng. Most of the talks concerned the issue of Hong Kong. By the time she had left, the United Kingdom and the People's Republic of China had signed an agreement in principle to hand Hong Kong from the UK over to China. In 1984, the agreement was formalized in a document known as the Joint Declaration.
As the economic reforms on the mainland spread, the question of political reform started to come to the surface, propelled by events in the Soviet Union and Eastern Europe. This came to a head in Tiananmen Square in May, 1989. The leaders of the Communist Party saw this as an attack on their power, and proceeded to destroy it. Officially, 200 demonstrators died. The actual figure is not known, and it is doubtful that there will ever be an accurate roll call of those who died on June 4.
In 1993, Deng Xiaoping, in one of his last major public appearances, toured the Shenzhen Special Economic Zone and emphatically voiced his approval. After that, the Chinese economy exploded, and it has only been recently that the economy has cooled off to more reasonable levels.
One of the most significant developments in recent history was the death of Deng, on February 19, 1997. While he has not been active in politics for some time and has not appeared in public for more than three years, the deaths of senior leaders has always had an unsettling impact on Chinese politics. Given Deng's former position as the paramount leader of the country, the political shockwaves will not only be substantial, but unpredictable.
Longer term, it is impossible to predict what will happen next. China will probably become a leading industrial power sometime in the 21st century, and it will probably become more closely economically tied to its East Asian neighbors. However, predictions that China will become the world's largest economy by the year 2020 are based on unsustainable growth projections. And if the last 150 years of Chinese history tells us anything, it is that the only predictable thing is unpredictability.
(This historical treatise was written by Paul Frankenstein.)
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