The policies of Chiang's government undermined Nationalist support. In contrast, the Communists, led by Mao Zedong, gained strength throughout the country. In the areas they controlled, communists worked to win peasant support. They encouraged peasants to learn to read, and they helped to improve food production. As a result, more and more recruits flocked to the Communist' Red Army. By 1945, much of northern China was under communist control. The aid from U.S wasn't enough to save the Nationalists, whose weak military leadership and corrupt, abusive practices drove the peasants to the Communist side. After more than 20 years of struggle after Chiang fled to Taiwan, the communists ruled all of mainland of China, and established a new government called Republic of china.
The U.S refused to accept as china's true government. The American public was stunned and conservative republicans and democrats attacked the Truman administration for supplying only limited aid to chiang. Fear of communism began to burn out of control.