China

Nationalist deterioration

The military weakness in 1944 was symptomatic of a gradual deterioration that had taken place in most aspects of Nationalist Chinese public life. Inflation began to mount alarmingly as the government pumped in large amounts of paper currency to make up its fiscal deficits. Salaries of government employees, army officers, teachers, and all those on wages fell far behind rising prices. For most, this spelled poverty amid growing war-weariness. Dissatisfaction with the government’s policies spread among intellectuals. Inflation gave opportunities for some groups to profit through hoarding needed goods, smuggling high-value commodities, black market currency operations, and graft. Corruption spread in the bureaucracy and the armed forces. As the war dragged on, government measures to suppress dissidence grew oppressive. Secret police activity and efforts at thought control were aimed not only against communists but also against all influential critics of the government or the KMT.