In the late twelfth and early thirteenth centuries, under the rule of Pope Innocent III, the papacy attained its height in power and influence. He held the fullness of power in Christendom. All the churches were under his control and he exerted his powers in government as well, appointing a candidate as emperor and making the king of England bow to his will. But this was to change with the next pope, Innocent IV. He deposed the emperor at the Council of Lyons and weakened the empire. Vocations to the monastic life declined, institutions in the church began to decay, and disagreements arose among cardinals in papal election.
In addition, nationalism was on the rise. With the decline of the Holy Roman Empire, Western monarchies rose by writing feudal law in their favor. Eventually these monarchies would come up against papal power and conflict would ensue between them. This is highlighted in the removal of Rome as the center of the Church and replacing it with Avignon, France. This period was called the Babylonian Captivity, named after the Biblical reference to Israel being captured by the Persians. The central power of the Church was at the mercy of the French king. The French cardinals had the upper hand in papal elections, and the Papal State fell into disrepair. Before the papacy finally returned to Rome, there was a period in which three claimed to be the authentic pope. This was known as the Great Western Schism. The Schism further reduced the power of the papacy and its influence. Its credibility had sunk to new lows. The nobility in different countries used this to their benefit in attaining power, land, and money from the church.
Eventually, the Western Schism ended, and the true pope was elected. When the papacy returned to Rome the infrastructure of Rome was in ruins. A mass building project was proposed with the rebuilding of Saint Peter’s Basilica and other major monuments in the Eternal City. Of course this required money, so Catholics throughout Europe were encouraged to give to rebuild Rome. This did not meet with open hands, especially with the nobility. They did not want Rome to become powerful again, because it meant they would lose power.
Another grave problem was the ignorance of the clergy. Since there were no standardized texts or seminaries for the priests to learn from, they were often uneducated. They misinformed people concerning the doctrines of the Church. Bad theology (though never the official teachings of the Church) and ignorant clergy were the impetus for Martin Luther and his 95 Theses.