Also an Illyrican peasant having risen through the army, Diocletian (284- 304) and his successor Constantine (r. 313-337) reformed the imperial system to the point of remaking Roman state and society. When Diocletian ascended to the Purple, borders had been barely reestablished; Germanic and Sassanid threats continued, just as commerce and farming had decreased, engendering military requisitioning and difficult supply problems. This troubling situation was compounded by the continually decreasing silver content of the coinage, which caused inflation. Upon taking the throne, the first thing Diocletian did was to ensure that he did not go the way of previous military emperors. He withdrew to a secluded palace in Nicomedia (Asia Minor), espousing the idea of a remote, semi-deified monarch, and eschewing the classical Principate idea of imperial primus inter pares and senatorial cooperation in government.
Diocletian then took several measures to reinvigorate the Roman State: 1) Given constant military threats in East and West, he divided the empire into two. Maximian was named co-emperor in Italy, Gaul, N. Africa, and Iberia, with the effective capital in Milan, closer to the limes. Diocletian reserved all else, including the Balkans, to himself, and ruled from Nicomedia. 2) Concerned with succession, he and Maximian, both titled Augustus, adopted trusted generals as sons, naming them Caesars, who acted as deputies that would assume the throne upon an Augustus' retirement. This system was called the Tetrarchate. 3) Reforming the administrative divisions, the 50 existing provinces were subdivided into 100, grouping them into 13 intermediate dioceses. These were administered by a centrally-appointed bureaucracy designed to monitor local decurions' conduct. The bureaucracy created a link between outlying regions and central Rome, curtailing powers of potential rebels and increasing efficiency. The empire now became a bureaucratic state. 4) Defending long frontiers was increasingly impossible given army size. Diocletian doubled it from 300,000 to 600,000. To find soldiers, he decreed that sons of soldiers had to follow their fathers into service. From this decree a caste emerged, creating a ready supply of troops but also increasing social gaps in Roman society. Further, empire-wide conscription was implemented. Since many coastal and older Roman regions could evade the draft, most soldiers from the 300s came from the Balkan, barbarian peoples newly entered into Roman lands. 5) Debasement of the coinage (progressively lessening its silver content) beginning in the Severi years caused runaway inflation. The state had increasing trouble paying its debts, paying its soldiers, and raising new revenues. To end inflation, and raise revenues, Diocletian issued a new, bimetallic currency, consisting of a decent gold coin, as well as a heavier silver one. He also imposed a new land tax, based upon a survey of all the empire's agricultural land. The object was to make the tax fair and bearable, so that the government could estimate available and needed revenues for a year and generate a budget fully supported by taxes. Problems emerged when the exchange rate between the gold and silver coins was incorrect, so that bad money drove out the good, peasants were unable to cover their tax burden and escaped their debts by fleeing to the city, strangling urban environments for food. Diocletian implemented new policies in 302. The peasant was legally prohibited from leaving his plot of land. Though still free in other terms, this began the road to the enserfment of peasants and is a foundation of the rise of the manorial systems. Further, taxes were now payable in kind, in commodities the state could use. Finally, price and wage controls for the entire empire were set, in the hopes that the measure would prevent inflation and guarantee commoners' livelihoods. In order to guarantee receipt of tax revenues, provincial urban business classes, decurions, were forced to serve for life as tax collectors. This new system provided enough revenue, and Diocletian's subsequent establishment of state workshops, whose slave and conscript workers produced arms and uniforms for the army and bureaucracy, allowed the state to avoid market dynamics.
Diocletian and Maximian retired in 304, after which their deputies descended into conflict. Constantine defeated his chief rival Maxentius at the Battle of Milvian Bridge (312). As Augustus of the West he shared power with Licinius in the East until 324, when he defeated Licinius and took sole power over the Empire. Constantine continued the reforms of Diocletian. Imperial court ceremony was made even more strict and exclusive. The senate was demoted to city council of Rome, while the central government's bureaucracy was increased. Masters of the Army, magistri militum, assured imperial control of the military forces. These were increased to 900,000 men, including an increasingly Germanized field army and marginally Romanized barbarian forces stationed along borders as federates (foederati). Provinces increased to 117 and dioceses to 14, all administrated by four civilian praetorian prefectures. Military and civil administration was separated for the first time. Constantine's Crown Council assumed the role of a cabinet. When he found decurions were trying to evade tax-collection by joining the civil bureaucracy, Constantine forbade it and made them a hereditary class.
Constantine went beyond Diocletian in two ways. A) Extending previous rulers' eastern tendencies, Constantine established a new imperial capital for the East, on the Bosphorous remains of the town of Byzantium. With construction beginning in 325, Constantinople took six years to build. Constantine attracted rich senatorial families to settle there, established a senate, and implemented a corn dole to attract lower classes. B) Constantinople was also to be a new kind of Roman city: Christian. Immediately prior to the Battle of Milvian Bridge, Constantine received a vision he interpreted to be of Christian inspiration, and went on to win the battle. From then, he became a generous patron of Christianity and the Church. Whereas Diocletian had implemented a severe round of Christian persecutions, Constantine's Edict of Milan (313) legalized the religion as a corporate body.
Though he did not make it the state religion, the Emperor took several measures to privilege Christianity: 1) He built several imposing churches in the empire's large cities, St. Peter's Basilica being an example. 2) He granted the church large agricultural tracts whose revenues supported church expansion. 3) As the church was known for charity, Constantine gave it access to imperial grain stores so it could be doled out. 4) The Church was allowed to receive legacies, and bequests of land to the corporate church soon made it the greatest Western landowner. 5) To increase the importance of bishops, Constantine allowed them to hold civil court, to which the general population could turn. 6) Decurions were allowed to escape their duties by joining the clergy. 7) Sunday became the official state holiday. These measures, along with the emperor's courting of converts and apologetic stance, allowed Christianity to transform from a small, persecuted group to being a vital part of the Roman state by the 330s, at which time Constantine stripped pagan temples of their agricultural land, as well as their precious metals. He also banned sacrifice, the core of pagan rituals. Constantine died in 337, undergoing a death-bed baptism.
Diocletian and Constantine brought the metamorphosis in Roman state and society to its logical conclusion, given the previous trends and the Empire's perceived needs. Emperors became purposely secluded, orientalized leaders. Gone was any illusion of equality with the Senate, which was sidelined in terms of governing, consultative, and fiscal powers. Political and social hierarchies were made much more rigid, at least on paper. Along with evidencing the influence of long residence in Eastern areas of the Empire on the political thought of the Emperors, it is quite possible that this was done to elevate the emperors—who as Balkans or half-Germans might have felt insecure—beyond the level of being assassinated.