History of Russia deficit required borrowing, primarily from Amsterdam; five percent of the budget was allocated to debt payments. Paper money was issued to pay for expensive wars, thus causing inflation. For its spending, Russia obtained a large and glorious army, a very large and complex bureaucracy, and a splendid court that rivaled Paris and London. However, the government was living far beyond its means, and 18th-century Russia remained "a poor, backward, overwhelmingly agricultural, and illiterate country." Peter I was succeeded by his second wife, Catherine I (1725–1727), who was merely a figurehead for a powerful group of high officials, then by his
Peter II of Russia of state. Foreign witnesses proclaimed that “All of Russia is in terrible disorder ... money is not paid to anyone. God knows what will happen with finances. Everyone steals, as much as he can.” Moving the court and several other institutions from St. Petersburg back to Moscow was painful for the new capital, as well as the nobility forced to move with it, as Peter the Great had put much effort into developing St. Petersburg into a large and lively city at the time. Peter II returned to St. Petersburg from time to time, but continued an aimless life full