Unemployment and inflation were high. The island’s unions were riddled with communists, many Chinese-¬educated, inspired by Mao Zedong’s rise to power and eager to stage a similar revolution in Singapore. Offering his legal services for free to unions, Lee built up a grassroots electoral base and became a rival to the communists, who were officially banned. In 1954 he formed the People’s Action Party (PAP) in the basement of his house. Two of the men sitting inside that basement, Goh Keng Swee and S. Rajaratnam—the former to be his economic mastermind, the latter his envoy to the outside world—would help Lee through the many crises that would test Singapore in the coming years.