But in 1926, when his younger brother Jose was already an undersecretary in the Department of Justice of the American colonial government, Pedro lost the election for governor of Pampanga.

Instead Pedro, who was already 50 years old, joined his friends Crisanto Evangelista, Antonio de Ora and Cirilo Bognot to study at the Lenin Institute in Moscow, in then Soviet Union.

Marxist principles found fertile ground in Pampanga and the other provinces of the Central Luzon region because of the poverty which farmers blamed on the land tenancy system prevalent at that time.

On October 26, 1932, Pedro founded the Socialist Party of the Philippines when the Partido Komunista ng Pilipinas (PKP) was outlawed by the Supreme Court.

Two years later, together with his assistants Agapito del Rosario, Luis Taruc, Lino Dizon, and others, he organized the Aguman ding Talapagobra ning Pilipinas (ATP) into the Aguman ding Maldang Talapagobra (AMT), similar to the general workers’ unions in Spain, Mexico and France, which advocated the expropriation of landed estates and friar lands, farmers’ cooperative stores and the upliftment of peasants’ living conditions.

Quezon decided to launch it in Pampanga and Pedro's group organized a gathering of farmers and workers at San Fernando in February for the purpose.

Pedro threw his hat in the November 11, 1941 elections, running for president, alongside his Vice-Presidential running mate, Pilar V. Aglipay (widow of the late Bishop Gregorio Aglipay) of the Republican Party, and a 23-man senatorial slate, among them Crisanto Evangelista, Juan Feleo, Jose Alejandrino, Jose Padilla Sr., Mateo del Castillo, and Norberto Nabong.

He was still incarcerated at Fort Santiago when his brother Jose, who was named Chief Justice of the Supreme Court in December of the previous year, was executed by the Japanese.

A bachelor, he joined his protégé Luis Taruc, who had founded the guerilla force Hukbo ng Bayan Laban sa Hapon (Hukbalahap) (Tagalog for People's Army Against the Japanese).