During the 16th and 17th centuries, Russia developed largely in isolation from the West, both economically and politically. Virtually landlocked, the boyars (great nobles) of this feudal empire crafted a centralized bureaucracy.
During the 16th century, early in the Romanov dynasty, the state sanctioned serfdom by curtailing peasant rights to leave a landlord. Taxation left those tethered to the land impoverished.
The movement of tradesman and craftsman was similarly restricted. All segments of the working population were subject to heavy taxes. This guaranteed regular peasant riots. The greatest peasant revolt in 17th century Europe was in 1667, as the Cossacks – free settlers of south Russia – reacted against state centralization and heavy tax burden.
Serfs escaped their landlords and joined the rebels. The Cossack leader, Stenka Razin, incited peasant uprisings as he led his followers up the Volga River. The tsar’s army finally crushed the rebellion in 1670. Razin was captured and beheaded a year later.
Urban citizens were equally bumptious. Muscovites revolted against the Romanovs over taxes in the Salt Riot (1648); the Copper Riot (1662), over inflation from debasing the currency; and the Streltsy Uprising (1682), a civil revolt by state-employed guards (streltsy) in Moscow, who easily incited mobs of impoverished residents to riot and loot.
The coming to power of Peter the Great in 1682 led to Russia becoming a more modern and bellicose state. Peter deliberately set out to economically modernize and culturally westernize his country. Peter subsidized western European entrepreneurs and artisans to settle in Russia and practice their commerce and crafts. He built St. Petersburg on land conquered from Sweden. This provided a convenient port onto the Gulf of Finland, which led into the Baltic Sea. Peter set out to build a navy.
All of Peter’s policies and reforms had a singular goal: to render Russia a great military power. The country was at war, mostly offensively, for all but 2 years of Peter’s reign.
Government administration was centralized and rationalized. An efficient tax system was devised, as Peter put it: “to collect money, as much as possible, for the artery of war.”
When domestic industries could not produce government demand for armaments, Peter set up state-owned mines, foundries, factories, and shipyards, staffed by Western managers and technicians.
These managers were supposed to train a native labor force. But since the labor supply consisted of illiterate serfs, the effort met with scant success. Only copper and iron industries in the Ural Mountains, where ore, timber, and waterpower were plentiful and cheap, became viable.
Peter’s highly regressive tax regime failed to deliver sufficient income to fund his army and bureaucracy. All the while, the only truly productive force in the economy – peasants – toiled away for a bare subsistence after the extractions of their masters and the state.