After the chaos of the aftermath of the assassination, California had returned to a status quo. In 1886, the Census Department announced with pride that California had surpassed 1 million residents, and that San Francisco was still the largest city with a population of 306,130. As it stood, 81% of the population was Anglo, another 11% was Hispanic, the next 6% were of Oriental descent, and the remaining 2% were everyone else, mostly Afro-Californians who had escaped slavery from Texas and later the CSA and Native Americans (almost all of whom lived in the State of Navajo). Among the 81% that were Anglos, most came from the United Kingdom, the United or Confederate States, France, the newly unified Germany, Scandinavia, Canada, Russia, or Austria-Hungary.
A new demographic had started growing in all of this. After the Boshin War, Japan had been unified, and ended its isolation from the world. As a consequence, the Japanese people had started traveling abroad, and some were moving to California. By the census of 1886, there were 3,613 people of Japanese descent living in California, mostly in the San Francisco Bay Area. Their presence was somewhat complicated, as the Celestial Laws were still heavily in effect, but the Japanese were neither Chinese nor Anglo. Some cities, like Redwood, created "Jap Laws" that had the same principle as the Celestial Laws, while right across the Bay in San Francisco the Japanese were largely corralled into a "Japantown" south of Market along Howell Street, or as it came to be known by the residents, "Hayao Tōri".
With a diverse population, California had evolved into a nation reminiscent of the United States in miniature. In fact, the California Republic had entered a close relationship with the United States after the northern railroad was completed. President Grover Cleveland of the USA wanted a close relationship with California, especially with the growing US economy desiring a greater amount of metals for its industry. Trade quickly began to bloom across the boundary with the USA, and Salt Lake City grew as the last stop going out of California for the trains. At the same time, the town of Las Cruces was also growing as a similar city for the line that connected California with the Confederate States. In the case of both the USA and CSA, they highly valued trade with California, as it meant that they both had access to the Pacific Ocean, with California as a proxy.
To the north, the Dominion of Cascadia had been independent for some time, serving as Britain's arm on the western coast of North America. However, the renewed colonial race in Africa had diverted their attention elsewhere. With this, California had fallen ever more into the sphere of influence of the United States. American culture had started to saturate California, with books and plays working their way all across California. California, however, had also started its own sort of culture, a blend of Anglo, Mexican, and Chinese cultures that served to define California as a "cultural melting pot". Californian culture especially came to prominence in the world when something new happened: an all-Chinese-Californian theater troupe called Huaxia managed to get a booking in 1889 at the Sierra Nevada Theater in San Francisco for a play entitled The Ballad of Hua Mulan, and it was a monstrous hit. The troupe began to play across California, and later all of North America. With a Chinese fable suddenly becoming the next big thing in California, many began to question the treatment of the Chinese living in California.
By 1890, a remarkable new issue had come to pass. President Minett had filed himself as a candidate for President, which to some seemed like a violation of the law that Presidents could not be reelected. However, Minett posited that as he had come to the office after the death of President Welch, he hadn't been elected, therefore he would be standing for his first election, and continue serving as President. While the people were against Minett standing for a second term as President, the Supreme Court decided in Wheeler v. Minett that President Minett could stand for his "first election". The people were outraged, and there was a surge of support for the Freedom Party. In fact, many people registered as Bear Flag voters cast their votes for Freedom, against the idea of a Presidency longer than 6 years. The resultant landslide brought the Freedom Party candidate Campbell Newton an easy victory, and he was sworn in as the 11th President of California.
Newton's Presidency was defined by a new legal struggle against the Celestial Laws. At the same time, a renewed push against Separacíon had arisen. All of this was a fertile ground for the rise of a new element in Californian society: socialism. Long a fringe ideology, it had started gaining ground through three main avenues: the Chinese-Californians, the Hispanic-Californians, and an increasing number of discontented workers seeking to change the frustrating status quo. The growing "Progressive Movement", however, was an interesting sort of change. Unlike traditional socialism, the ideology in California had evolved to merge with other elements of classical liberalism, such as guaranteeing the right to vote for everyone regardless of gender or race, legal protection under the law for all citizens, and a market economy. The end result was a form of liberalism that was more focused on equality than freedom, an ideology sometimes referred to as "Social Liberalism".
With the rise of new Socialist elements in California, the Freedom Party found its support being worn away, as people found Freedom's persistence of maintaining the status quo irritating. More and more people had started flocking to the new socialist parties in California. However, these parties were smaller, regional groups that couldn't coordinate on a larger scale, owing to the fact that their support was still fairly small. In 1892, though, a traveling socialist demagogue named Lester F. Ward, who traveled all across North America, gave a series of speeches in San Francisco, Sacramento, San Diego, Los Angeles, and even several of the smaller cities like Merced, Eureka, and Bakersfield. His speeches rallied many people to the cause of socialism, and catalysed the merging of the 7 largest socialist parties into a single party, the Progressive Party. Its sudden appearance in Californian politics was incredibly dramatic, and in the midterm elections of 1893, 14 Progressive Senators were elected, and 37 Representatives were elected. At the same time, several local towns elected Progressive mayors and other representatives in the various states and territories.
In the leadup to the campaign of 1896, the Progressive Party had been getting an increasing level of support, and their candidate, former mayor of Sacramento William Conagher. In a three-way race, the wave of support for the Progressives drained support from the Freedom Party, and soared to the front of the campaign. In a massive political upset, the Freedom Party received less than 20% of the vote, while the Progressive Party won with 45% of the vote. For the first time in world history, a socialist government had been peacefully elected to power, and William Conagher was sworn in as the 12th President of California.
