After The Establishment of The PRC
On October 1, 1949, Mao announced the establishment of the People’s Republic of China. During the ceremony, Liu stood next to Mao. This marked the peak of his career as a military commander. In January 1950, Liu was appointed chairman of the Southwestern Division of the Central People’s Government of PRC, together with Gao Gang, Rao Shushi, Peng and Lin Biao. The rewards of conquering southwestern China, however, proved only to be temporary. Mao soon sent his favorite general He Long to work alongside Liu, to supervise and share the power with Liu. During his short tenure as governor, Liu led his soldiers in the crackdown of bandits and restored law and order, oversaw economic development, and more importantly, made plans for the communist invasion of Tibet.
Towards the end of 1950, Liu was transferred to Nanjing as president and commissar of the Military Academy of the PLA, which would be considered a demotion for Liu. There were no clear or generally accepted reasons on record for his falling out of favour. One popular opinion holds that, during the long period of time that Liu worked with or under Mao, he's never really earned Mao's trust. Liu himself knew that too. From the Chinese history, he learnt that most generals that helped establish a new dynasty ended up getting killed by the suspicious Emperor. In order to prevent that from happening on himself, he tried to stay as far away from politics as possible. Because of his early year military training in Soviet Union, he used that as an excuse to quit his job in the government and become the president and commissar of the Military Academy of the PLA. Mao approved his request. The other story says that, while Liu was still chairman, someone unknown to the public submitted a biography of Liu in support of his promotion. In this biography he described Liu as an offspring of Liu Bang, founder and first emperor of the Han Dynasty, and hinted that Liu himself could set up his own empire as his ancestor did. Knowing of the cruelties and conspiracies in Chinese history, Liu was worried instead of happy, because he knew that it would arouse Mao's suspicions over Liu's intentions. Although Liu had this man arrested, Mao still learnt of the event, and Liu’s worries eventually turned into reality. This only served to further increase Mao’s long-time distrust of Liu.
Despite the demotion, Liu was dedicated to his new job, attempting to bring what he learned during his years in the Soviet Union to the Academy. He organised the translations of numerous military textbooks from the Soviet Union and other countries, introducing major campaigns from ancient times to World War II to students, and sowing the seeds of the PLA's evolution into a modern army. Although Liu was appointed Vice-Chairman of the Central Military Committee of the CPC and PRC in 1954 as a reward for his contributions, these titles did not promise real power as Peng's did. (Peng was appointed Defense Minister for his battle achievements in the Korean War.) In 1955, Liu attained the rank of field marshal, ranking as the 4th amongst 10 field marshals of the PLA, next to Zhu De, Peng and Lin Biao.
In 1956, after Nikita Khrushchev shook the Communist world by making his famous Secret Speech denouncing the cult of personality that surrounded Joseph Stalin, Mao wanted to ensure that a similar incident within the CPC would not happen. He wrote an article, "On Ten Relationships", arguing that the CPC should learn from foreign countries selectively, analytically and with criticism. The CPC center then issued documents to call on all CPC members to overcome the trend of dogmatism and empiricism at work. Investigations and purges were carried out by the military, under the direction of Peng. As an advocate of learning from other countries, Liu became a key target. Some of his subordinates and deputies, including General Xiao Ke (萧克), were censored and kept in custody. Liu had to make rounds of analyses and apologies. Under heavy pressure, his health worsened (he eventually lost all sight in his remaining eye), and he finally submitted his resignation as president.
In 1959, Liu left Nanjing for Beijing and lived in half-reclusion. Although he was since elected as member of the Politburo in the 8th to 11th National Congress of the CPC, Vice-Chairman of the 2nd to 5th Standing Committee of the National People’s Congress, and all the while holding the title of Vice-Chairman of the Military Committee, he did not participate very much in politics, citing health problems as a reason for his absence. This saved him from the following rounds of purges carried out by Mao. Peng, however, was not as fortunate. He was purged in the Lushan Conference in 1959 and later tortured to death during the Cultural Revolution.
By the time of the Cultural Revolution, Liu became completely blind. Nonetheless, he survived the purge and witnessed his long-time friend Deng returning to power again. He supported Deng in the power struggle against Mao’s widow, Jiang Qing, and her Gang of Four, and also advocated Deng's policy of reforming and opening up China to the outside world, a policy that Liu himself had practiced in the Academy decades ago.
In 1982, Liu retired due to worsening health problems. This gave Deng a boost in his calling for the retirement of aging leaders in order to clear the way for younger leaders of the CPC. On October 7, 1986, Liu died in Beijing, at the age of 94. In the lament given to him, Liu was rehabilitated and cleared of all charges against him during the movements against dogmatism.
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