Encyclopaedia Britannica, 11th Edition, Volume 3, Part 1, Slice 1 - "Austria, Lower" to "Bacon"
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Meanwhile, renewed trouble had broken out in Vienna, where the radical populace was in conflict alike with the government and with the Slav majority of the Reichsrath. The German democrats appealed for aid to the Hungarian government; but the Magyar passion for constitutional legality led to delay, and before the Hungarian advance could be made effective, it was too late. On the 7th of October the emperor Ferdinand had fled from Schoenbrunn to Olmuetz, a Slav district, whence he issued a proclamation inviting whoever loved "Austria and freedom" to rally round the throne. On the 11th Windischgraetz proclaimed his intention of marching against rebellious Vienna, and on the 16th an imperial rescript appointed him a field-marshal and commander-in-chief of all the Austrian armies except that of Italy. Meanwhile, of the Reichsrath, the members of the Right and the Slav majority had left Vienna and announced a meeting of the diet at Bruenn for the 20th of October; all that remained in the capital was a rump of German radicals, impotent in the hands of the proletariat and the students. The defence of the city was hastily organized under Bern, an ex-officer of Napoleon; but in the absence of help from Hungary it was futile. On the 28th of October Windischgraetz began his attack; on the 1st of November he was master of the city.

The fall of revolutionary Vienna practically involved that of the revolution in Frankfort and in Pest. From Italy the congratulations of Radetzky's victorious army came to Windischgraetz, from Russia the even more significant commendations of the emperor Nicholas. The moral of the victory was painted for all the world by the military execution of Robert Blum, whose person, as a deputy of the German parliament, should have been sacrosanct. The time had, indeed, not yet come to attempt any conspicuous breach with the constitutional principle; but the new ministry was such as the imperial sentiment would approve, inimical to the German ideals of Frankfort, devoted to the traditions of the Habsburg monarchy. At its head was Prince Felix Schwarzenberg (q.v.), the "army-diplomat," a statesman at once strong and unscrupulous. On the 27th of November a proclamation announced that the continuation of Austria as a united state was necessary both for Germany and for Europe. [Sidenote: Accession of Francis Joseph, 1848] On the 2nd of December the emperor Ferdinand, bound by too many personal obligations to the revolutionary parties to serve as a useful instrument for the new policy, abdicated, and his nephew Francis Joseph ascended the throne. The proclamation of the new emperor was a gage of defiance thrown down to Magyars and German unionists alike: "Firmly determined to preserve undimmed the lustre of our crown," it ran, "but prepared to share our rights with the representatives of our peoples, we trust that with God's aid and in common with our peoples we shall succeed in uniting all the countries and races of the monarchy in one great body politic."

While the Reichsrath, transferred to Kremsier, was discussing "fundamental rights" and the difficult question of how to reconcile the theoretical unity with the actual dualism of the empire, the knot was being cut by the sword on the plains of Hungary. The Hungarian retreat after the bloody battle of Kapolna (February 26-27, 1849) was followed by the dissolution of the Kremsier assembly, and a proclamation in which the emperor announced his intention of granting a constitution to the whole monarchy "one and indivisible." On the 4th of March the constitution was published; but it proved all but as distasteful to Czechs and Croats as to the Magyars, and the speedy successes of the Hungarian arms made it, for the while, a dead letter. It needed the intervention of the emperor Nicholas, in the loftiest spirit of the Holy Alliance, before even an experimental unity of the Habsburg dominions could be established (see HUNGARY: History).

The capitulation of Vilagos, which ended the Hungarian insurrection, gave Schwarzenberg a free hand for completing the work of restoring the status quo ante and the influence of Austria in Germany. The account of the process by which this was accomplished belongs to the history of Germany (q.v.). Here it will suffice to say that the terms of the Convention of Olmuetz (September 29, 1850) seemed at the time a complete triumph for Austria over Prussia. As a matter of fact, however, the convention was, in the words of Count Beust, "not a Prussian humiliation, but an Austrian weakness." It was in the power of Austria to crush Prussia and to put an end to the dual influence in the Confederation which experience had proved to be unworkable; she preferred to re-establish a discredited system, and to leave to Prussia time and opportunity to gather strength for the inevitable conflict.

[Sidenote: Triumph of Austria.]

In 1851 Austria had apparently triumphed over all its [v.03 p.0017] difficulties. The revolutionary movements had been suppressed, the attempt of Prussia to assume the leadership in Germany defeated, the old Federal Diet of 1815 had been restored. Vienna again became the centre of a despotic government the objects of which were to Germanize the Magyars and Slavs, to check all agitation for a constitution, and to suppress all attempts to secure a free press. For some ten years the Austrian dominion groaned under one of the worst possible forms of autocratic government. The failure of the Habsburg emperor to perpetuate this despotic regime was due (1) to the Crimean War, (2) to the establishment of Italian unity, and (3) to the successful assertion by Prussia of its claim to the leadership in Germany. The disputes which resulted in the Crimean War revealed the fact that "gratitude" plays but a small part in international affairs. In the minds of Austrian statesmen the question of the free navigation of the Danube, which would have been imperilled by a Russian occupation of the Principalities, outweighed their sense of obligation to Russia, on which the emperor Nicholas had rashly relied. That Austria at first took no active part in the war was due, not to any sentimental weakness, but to the refusal of Prussia to go along with her and to the fear of a Sardinian attack on her Italian provinces. But, on the withdrawal of the Russian forces from the Principalities, these were occupied by Austrian troops, and on the 2nd of December 1854, a treaty of alliance was signed at Vienna, between Great Britain, Austria and France, by which Austria undertook to occupy Moldavia and Walachia during the continuance of the war and "to defend the frontier of the said principalities against any return of the Russian forces." By Article III., in the event of war between Russia and Austria the alliance both offensive and defensive was to be made effective (Hertslet, No. 252). With the progressive disasters of the Russian arms, however, Austria grew bolder, and it was the ultimatum delivered by her to the emperor Alexander II. in December 1855, that forced Russia to come to terms (Treaty of Paris, March 30, 1856).

Though, however, Austria by her diplomatic attitude had secured, without striking a blow, the settlement in her sense of the Eastern Question, she emerged from the contest without allies and without friends. The "Holy Alliance" of the three autocratic northern powers, recemented at Muenchengraetz in 1833, which had gained for Austria the decisive intervention of the tsar in 1849, had been hopelessly shattered by her attitude during the Crimean War. Russia, justly offended, drew closer her ties with Prussia, where Bismarck was already hatching the plans which were to mature in 1866; and, if the attitude of Napoleon in the Polish question prevented any revival of the alliance of Tilsit, the goodwill of Russia was assured for France in the coming struggle with Austria in Italy. Already the isolation of Austria had been conspicuous in the congress of Paris, where Cavour, the Sardinian plenipotentiary, laid bare before assembled Europe the scandal of her rule in Italy. It was emphasized during the campaign of 1859, when Sardinia, in alliance with France, laid the foundations of united Italy. The threat of Prussian intervention, which determined the provisions of the armistice of Villafranca, was due, not to love of Austria, but to fear of the undue aggrandizement of France. The campaign of 1859, and the diplomatic events that led up to it, are dealt with elsewhere (see ITALY, ITALIAN WARS, NAPOLEON III., CAVOUR). The results to Austria were two-fold. Externally, she lost all her Italian possessions except Venice; internally, her failure led to the necessity of conciliating public opinion by constitutional concessions.

The proclamation on the 26th of February 1861 of the new constitution for the whole monarchy, elaborated by Anton von Schmerling, though far from satisfying the national aspirations of the races within the empire, at least gave Austria a temporary popularity in Germany; the liberalism of the Habsburg monarchy was favourably contrasted with the "reactionary" policy of Prussia, where Bismarck was defying the majority of the diet in his determination to build up the military power of Prussia. The meeting of the princes summoned to Frankfort by the emperor Francis Joseph, in 1863, revealed the ascendancy of Austria among the smaller states of the Confederation; but it revealed also the impossibility of any consolidation of the Confederation without the co-operation of Prussia, which stood outside. Bismarck had long since decided that the matter could only be settled by the exclusion of Austria altogether, and that the means to this end were not discussion, but "Blood and Iron." The issue was forced by the developments of the tangled Schleswig-Holstein Question (q.v.), which led to the definitive breach between the two great German powers, to the campaign of 1866, and the collapse of Austria on the field of Koniggratz (July 3. See SEVEN WEEKS' WAR).

(W. A. P.; A. HL.)

[Sidenote: Establishment of the dual monarchy.]

The war of 1866 began a new era in the history of the Austrian empire. By the treaty of Prague (August 23, 1866) the emperor surrendered the position in Germany which his ancestors had held for so many centuries; Austria and Tirol, Bohemia and Salzburg, ceased to be German, and eight million Germans were cut off from all political union with their fellow-countrymen. At the same time the surrender of Venetia completed the work of 1859, and the last remnant of the old-established Habsburg domination in Italy ceased. The war was immediately followed by a reorganization of the government. The Magyar nation, as well as the Czechs, had refused to recognize the validity of the constitution of 1861 which had established a common parliament for the whole empire; they demanded that the independence of the kingdom of Hungary should be restored. Even before the war the necessity of coming to terms with the Hungarians had been recognized. In June 1865 the emperor Francis Joseph visited Pest and replaced the chancellors of Transylvania and Hungary, Counts Francis Zichy and Nadasdy, supporters of the February constitution, by Count Majlath, a leader of the old conservative magnates. This was at once followed by the resignation of Schmerling, who was succeeded by Count Richard Belcredi. On the 20th of September the Reichsrath was prorogued, which was equivalent to the suspension of the constitution; and in December the emperor opened the Hungarian diet in person, with a speech from the throne that recognized the validity of the laws of 1848. Before any definite arrangement as to their re-introduction could be made, however, the war broke out; and after the defeats on the field of battle the Hungarian diet was able to make its own terms. They recognized no union between their country and the other parts of the monarchy except that which was based on the Pragmatic Sanction.[5] All recent innovations, all attempts made during the last hundred years to absorb Hungary in a greater Austria, were revoked. An agreement was made by which the emperor was to be crowned at Pest and take the ancient oath to the Golden Bull; Hungary (including Transylvania and Croatia) was to have its own parliament and its own ministry; Magyar was to be the official language; the emperor was to rule as king; there was to be complete separation of the finances; not even a common nationality was recognized between the Hungarians and the other subjects of the emperor; a Hungarian was to be a foreigner in Vienna, an Austrian a foreigner in Budapest. A large party wished indeed that nothing should be left but a purely personal union similar to that between England and Hanover. Deak and the majority agreed, however, that there should be certain institutions common to Hungary and the rest of the monarchy; these were—(1) foreign affairs, including the diplomatic and consular service; (2) the army and navy; (3) the control of the expenses required for these branches of the public service.

[Sidenote: Delegations.]

Recognizing in a declaratory act the legal existence of these common institutions, they also determined the method by which they should be administered. In doing so they carried out with great exactitude the principle of dualism, establishing in form a complete parity between Hungary on one side and the other territories of the king on the other. They made it a condition [v.03 p.0018] that there should be constitutional government in the rest of the monarchy as well as in Hungary, and a parliament in which all the other territories should be represented. From both the Hungarian and the Austrian parliament there was to be elected a Delegation, consisting of sixty members; to these Delegations the common ministers were to be responsible, and to them the estimates for the joint services were to be submitted. The annual meetings were to be held alternately in Vienna and in Pest. They were very careful that these Delegations should not overshadow the parliaments by which they were appointed. The Delegations were not to sit together; each was to meet separately; they were to communicate by writing, every document being accompanied by a translation in Magyar or German, as the case might be; only if after three times exchanging notes they failed to agree was there to be a common session; in that case there would be no discussion, and they were to vote in silence; a simple majority was sufficient. There were to be three ministers for common purposes—(1) for foreign affairs; (2) for war; (3) for finance; these ministers were responsible to the Delegations, but the Delegations were really given no legislative power. The minister of war controlled the common army, but even the laws determining the method by which the army was to be recruited had to be voted separately in each of the parliaments. The minister of finance had to lay before them the common budget, but they could not raise money or vote taxes; after they had passed the budget the money required had to be provided by the separate parliaments. Even the determination of the proportion which each half of the monarchy was to contribute was not left to the Delegations. It was to be fixed once every ten years by separate committees chosen for that purpose from the Austrian Reichsrath and the Hungarian parliament, the so-called Quota-Deputations. In addition to these "common affairs" the Hungarians, indeed, recognized that there were certain other matters which it was desirable should be managed on identical principles in the two halves of the monarchy—namely, customs and excise currency; the army and common railways. For these, however, no common institutions were created; they must be arranged by agreement; the ministers must confer and then introduce identical acts in the Hungarian and the Austrian parliaments.

[Sidenote: Financial settlement.]

The main principles of this agreement were decided during the spring of 1867; but during this period the Austrians were not really consulted at all. The negotiations on behalf of the court of Vienna were entrusted to Beust, whom the emperor appointed chancellor of the empire and also minister-president of Austria. He had no previous experience of Austrian affairs, and was only anxious at once to bring about a settlement which would enable the empire to take a strong position in international politics. In the summer of 1867, however (the Austrian Reichsrath having met), the two parliaments each elected a deputation of fifteen members to arrange the financial settlement. The first matter was the debt, amounting to over 3000 million gulden, in addition to the floating debt, which had been contracted during recent years. The Hungarians laid down the principle that they were in no way responsible for debts contracted during a time when they had been deprived of their constitutional liberties; they consented, however, to pay each year 29 1/2 million gulden towards the interest. The whole responsibility for the payment of the remainder of the interest, amounting annually to over a hundred million gulden, and the management of the debt, was left to the Austrians. The Hungarians wished that a considerable part of it should be repudiated. It was then agreed that the two states should form a Customs Union for the next ten years; the customs were to be paid to the common exchequer; all sums required in addition to this to meet the expenses were to be provided as to 30% by Hungary and as to 70% by Austria. After the financial question had been thus settled, the whole of these arrangements were then, on the 21st and the 24th of December 1867, enacted by the two parliaments, and the system of dualism was established.

The acts were accepted in Austria out of necessity; but no parties were really satisfied. The Germans, who accepted the principle of dualism, were indignant at the financial arrangements; for Hungary, while gaining more than an equal share of power, paid less than one-third of the common expenses. On the other hand, according to British ideas of taxable capacity, Hungary paid, and still pays, more than her share. The Germans, however, could at least hope that in the future the financial arrangements might be revised; the complaints of the Slav races were political, and within the constitution there was no means of remedy, for, while the settlement gave to the Hungarians all that they demanded, it deprived the Bohemians or Galicians of any hope that they would be able to obtain similar independence. Politically, the principle underlying the agreement was that the empire should be divided into two portions; in one of these the Magyars were to rule, in the other the Germans; in either section the Slav races—the Serbs and Croatians, the Czechs, Poles and Slovenes—were to be placed in a position of political inferiority.[6]

The logical consistency with which the principle of Dualism was carried out is shown in a change of title. By a letter to Beust of the 14th of November 1868 the emperor ordered that he should henceforward be styled, not as before "Emperor of Austria, King of Hungary, King of Bohemia, &c.," but "Emperor of Austria, King of Bohemia, &c., and Apostolic King of Hungary," thereby signifying the separation of the two districts over which he rules. His shorter style is "His Majesty the Emperor and King," and "His Imperial and Apostolic Royal Majesty"; the lands over which he rules are called "The Austrian-Hungarian Monarchy" or "The Austrian-Hungarian Realm." The new terminology, "Imperial and Royal" (Kaiserlich und Koeniglich), has since then been applied to all those branches of the public service which belong to the common ministries; this was first the case with the diplomatic service; not till 1889 was it applied to the army, which for some time kept up the old style of Kaiserlich-Koeniglich; in 1895 it was applied to the ministry of the imperial house, an office always held by the minister for foreign affairs. The minister for foreign affairs was at first called the Reichskanzler; but in 1871, when Andrassy succeeded Beust, this was given up in deference to Hungarian feeling, for it might be taken to imply that there was a single state of which he was minister. The old style Kaiserlich-Koeniglich, the "K.K." which has become so familiar through long use, is still retained in the Austrian half of the monarchy. There are, therefore, e.g., three ministries of finance: the Kaiserlich und Koeniglich for joint affairs; the Kaiserlich-Koeniglich for Austrian affairs; the Kiralye for Hungary.

[Sidenote: Common affairs.]

The settlement with Hungary consisted then of three parts:—(1) the political settlement, which was to be permanent and has since remained part of the fundamental constitution of the monarchy; (2) the periodical financial settlement, determining the partition of the common expenses as arranged by the Quota-Deputations and ratified by the parliaments; (3) the Customs Union and the agreement as to currency—a voluntary and terminable arrangement made between the two governments and parliaments. The history of the common affairs which fall under the management of the common ministries is, then, the history of the foreign policy of the empire and of the army. It is with this and this alone that the Delegations are occupied, and it is to this that we must now turn. The annual meetings call for little notice; they have generally been the occasion on which the foreign minister has explained and justified his policy; according to the English custom, red books, sometimes containing important despatches, have been laid before them; but the debates have caused less embarrassment to the government than is generally the case in parliamentary assemblies, and the army budget has generally been passed with few and unimportant alterations.

[Sidenote: Foreign policy.]

For the first four years, while Beust was chancellor, the foreign policy was still influenced by the feelings left by the war of 1866. We do not know how far there was a real intention to revenge Koeniggraetz and recover the position lost in Germany. This would be at least a possible policy, and one to which Beust by his previous history would be inclined. There were sharp passages of arms with the [v.03 p.0019] Prussian government regarding the position of the South German states; a close friendship was maintained with France; there were meetings of the emperor and of Napoleon at Salzburg in 1868, and the next year at Paris; the death of Maximilian in Mexico cast a shadow over the friendship, but did not destroy it. The opposition of the Hungarians and financial difficulties probably prevented a warlike policy. In 1870 there were discussions preparatory to a formal alliance with France against the North German Confederation, but nothing was signed.[7] The war of 1870 put an end to all ideas of this kind; the German successes were so rapid that Austria was not exposed to the temptation of intervening, a temptation that could hardly have been resisted had the result been doubtful or the struggle prolonged. The absorption of South Germany in the German empire took away the chief cause for friction; and from that time warm friendship, based on the maintenance of the established order, has existed between the two empires. Austria gave up all hope of regaining her position in Germany; Germany disclaimed all intention of acquiring the German provinces of Austria. Beust's retirement in 1871 put the finishing touch on the new relations. His successor, Count Andrassy, a Hungarian, established a good understanding with Bismarck; and in 1872 the visit of the emperor Francis Joseph, accompanied by his minister, to Berlin, was the final sign of the reconciliation with his uncle. The tsar was also present on that occasion, and for the next six years the close friendship between the three empires removed all danger of war. Three years later the full reconciliation with Italy followed, when Francis Joseph consented to visit Victor Emmanuel in Venice.

[Sidenote: The Eastern question.]

The outbreak of disturbance in the Balkans ended this period of calm. The insurrection in Bosnia and Herzegovina immediately affected Austria; refugees in large numbers crossed the frontier and had to be maintained by the government. The political problem presented was a very difficult one. The sympathy of the Slav inhabitants of the empire made it impossible for the government of Vienna to regard with indifference the sufferings of Christians in Turkey. Active support was impossible, because the Hungarians, among whom the events of 1848 had obliterated the remembrance of the earlier days of Turkish conquest, were full of sympathy for the Turks. It was a cardinal principle of Austrian policy that she could not allow the erection of new Slav states on her southern frontier. Moreover, the disturbances were fomented by Russian agents, and any increase of Russian influence (for which the Pan-Slav party was working) was full of danger to Austria. For a time the mediation of Germany preserved the good understanding between the two eastern empires. In 1875 Andrassy drafted a note, which was accepted by the powers, requiring Turkey to institute the reforms necessary for the good government of the provinces. Turkey agreed to do this, but the insurgents required a guarantee from the Powers that Turkey would keep her engagements. This could not be given, and the rebellion continued and spread to Bulgaria. The lead then passed to Russia, and Austria, even after the outbreak of war, did not oppose Russian measures. At the beginning of 1877 a secret understanding had been made between the two powers, by which Russia undertook not to annex any territory, and in other ways not to take steps which would be injurious to Austria. The advance of the Russian army on Constantinople, however, was a serious menace to Austrian influence; Andrassy therefore demanded that the terms of peace should be submitted to a European conference, which he suggested should meet at Vienna. The peace of San Stefano violated the engagements made by Russia, and Andrassy was therefore compelled to ask for a credit of 60 million gulden and to mobilize a small portion of the army; the money was granted unanimously in the Hungarian Delegation, though the Magyars disliked a policy the object of which appeared to be not the defence of Turkey against Russia, but an agreement with Russia which would give Austria compensation at the expense of Turkey; in the Austrian Deputation it was voted only by a majority of 39 to 20, for the Germans were alarmed at the report that it would be used for an occupation of part of the Turkish territory.

[Sidenote: Bosnia and Herzegovina.]

The active share taken by Great Britain, however, relieved Austria from the necessity of having recourse to further measures. By an arrangement made beforehand, Austria was requested at the congress of Berlin to undertake the occupation and administration of Bosnia and Herzegovina—an honourable but arduous task. The provinces could not be left to the Turks; Austria could not allow them to fall under Russian influence. The occupation was immediately begun, and 60,000 Austrian troops, under the command of General Philippovich,[8] crossed the frontier on the 29th of July. The work was, however, more difficult than had been anticipated; the Mahommedans offered a strenuous resistance; military operations were attended with great difficulty in the mountainous country; 200,000 men were required, and they did not succeed in crushing the resistance till after some months of obstinate fighting. The losses on either side were very heavy; even after the capture of Serajevo in August, the resistance was continued; and besides those who fell in battle, a considerable number of the insurgents were put to death under military law. The opposition in the Delegations, which met at the end of the year, was so strong that the government had to be content with a credit to cover the expenses for 1879 of less than half what they had originally asked, and the supplementary estimate of 40,000,000 gulden for 1878 was not voted till the next year. In 1879 the Porte, after long delay, recognized the occupation on the distinct understanding that the sovereignty of the sultan was acknowledged. A civil administration was then established, the provinces not being attached to either half of the empire, but placed under the control of the joint minister of finance. The government during the first two years was not very successful; the Christian population were disappointed at finding that they still had, as in the old days, to pay rent to the Mahommedan begs. There were difficulties also between the Roman Catholics and the members of the Greek Church. In 1881 disturbances in Dalmatia spread over the frontier into Herzegovina, and another expedition had to be sent to restore order. When this was done Benjamin de Kallay was appointed minister, and under his judicious government order and prosperity were established in the provinces. In accordance with another clause of the treaty of Berlin, Austria was permitted to place troops in the sanjak of Novi-Bazar, a district of great strategic importance, which separated Servia and Montenegro, and through which the communication between Bosnia and Salonica passed. This was done in September 1879, an agreement with Turkey having specified the numbers and position of the garrison. Another slight alteration of the frontier was made in the same year, when, during the delimitation of the new frontier of Montenegro, the district of Spizza was incorporated in the kingdom of Dalmatia.

[Sidenote: Italy and the Irredentists.]

The congress of Berlin indirectly caused some difficulties with Italy. In that country was a large party which, under the name of the "Irredentists," demanded that those Italian-speaking districts, South Tirol, Istria and Trieste, which were under Austrian rule, should be joined to Italy; there were public meetings and riots in Italy; the Austrian flag was torn down from the consulate in Venice and the embassy at Rome insulted. The excitement spread across the frontier; there were riots in Trieste, and in Tirol it was necessary to make some slight movement of troops as a sign that the Austrian government was determined not to surrender any territory. For a short time there was apprehension that the Italian government might not be strong enough to resist the movement, and might even attempt to realize these wishes by means of an alliance with Russia; but the danger quickly passed away.

[Sidenote: Alliance with Germany.]

In the year 1879 the European position of the monarchy was [v.03 p.0020] placed on a more secure footing by the conclusion of a formal alliance with Germany. In the autumn of that year Bismarck visited Vienna and arranged with Andrassy a treaty by which Germany bound herself to support Austria against an attack from Russia, Austria-Hungary pledging herself to help Germany against a combined attack of France and Russia; the result of this treaty, of which the tsar was informed, was to remove, at least for the time, the danger of war between Austria-Hungary and Russia. It was the last achievement of Andrassy, who had already resigned, but it was maintained by his successor, Baron Haymerle, and after his death in 1881 by Count Kalnoky. It was strengthened in 1882 by the adhesion of Italy, for after 1881 the Italians required support, owing to the French occupation of Tunis, and after five years it was renewed. Since that time it has been the foundation on which the policy of Austria-Hungary has depended, and it has survived all dangers arising either from commercial differences (as between 1880 and 1890) or national discord. The alliance was naturally very popular among the German Austrians; some of them went so far as to attempt to use it to influence internal policy, and suggested that fidelity to this alliance required that there should be a ministry at Vienna which supported the Germans in their internal struggle with the Slavs; they represented it as a national alliance of the Teutonic races, and there were some Germans in the empire who supported them in this view. The governments on both sides could of course give no countenance to this theory; Bismarck especially was very careful never to let it be supposed that he desired to exercise influence over the internal affairs of his ally. Had he done so, the strong anti-German passions of the Czechs and Poles, always inclined to an alliance with France, would have been aroused, and no government could have maintained the alliance. After 1880, the exertions of Count Kalnoky again established a fairly good understanding with Russia, as was shown by the meetings of Francis Joseph with the tsar in 1884 and 1885, but the outbreak of the Bulgarian question in 1885 again brought into prominence the opposed interests of Russia and Austria-Hungary. In the December of this year Austria-Hungary indeed decisively interfered in the war between Bulgaria and Servia, for at this time Austrian influence predominated in Servia, and after the battle of Slivnitza the Austro-Hungarian minister warned Prince Alexander of Bulgaria that if he advanced farther he would be met by Austro-Hungarian as well as Servian troops. But after the abdication of Alexander, Count Kalnoky stated in the Delegations that Austria-Hungary would not permit Russia to interfere with the independence of Bulgaria. This decided step was required by Hungarian feeling, but it was a policy in which Austria-Hungary could not depend on the support of Germany, for—as Bismarck stated—Bulgaria was not worth the bones of a single Pomeranian grenadier. Austria-Hungary also differed from Russia as to the position of Prince Ferdinand of Bulgaria, and during 1886-1887 much alarm was caused by the massing of Russian troops on the Galician frontier. Councils of war were summoned to consider how this exposed and distant province was to be defended, and for some months war was considered inevitable; but the danger was averted by the renewal of the Triple Alliance and the other decisive steps taken at this time by the German government (see GERMANY).[9]

Since this time the foreign policy of Austria-Hungary has been peaceful and unambitious; the close connexion with Germany has so far been maintained, though during the last few years it has been increasingly difficult to prevent the violent passions engendered by national enmity at home from reacting on the foreign policy of the monarchy; it would scarcely be possible to do so, were it not that discussions on foreign policy take place not in the parliaments but in the Delegations where the numbers are fewer and the passions cooler. In May 1895 Count Kalnoky had to retire, owing to a difference with Banffy, the Hungarian premier, arising out of the struggle with Rome. He was succeeded by Count Goluchowski, the son of a well-known Polish statesman. In 1898 the expulsion of Austrian subjects from Prussia, in connexion with the Anti-Polish policy of the Prussian government, caused a passing irritation, to which Count Thun, the Austrian premier, gave expression. The chief objects of the government in recent years have been to maintain Austro-Hungarian trade and influence in the Balkan states by the building of railways, by the opening of the Danube for navigation, and by commercial treaties with Rumania, Servia and Bulgaria; since the abdication of King Milan especially, the affairs of Servia and the growth of Russian influence in that country have caused serious anxiety.

[Sidenote: The army.]

The disturbed state of European politics and the great increase in the military establishments of other countries made it desirable for Austria also to strengthen her military resources. The bad condition of the finances rendered it, however, impossible to carry out any very great measures. In 1868 there had been introduced compulsory military service in both Austria and Hungary; the total of the army available in war had been fixed at 800,000 men. Besides this joint army placed under the joint ministry of war, there was in each part of the monarchy a separate militia and a separate minister for national defence. In Hungary this national force or honved was kept quite distinct from the ordinary army; in Austria, however (except in Dalmatia and Tirol, where there was a separate local militia), the Landwehr, as it was called, was practically organized as part of the standing army. At the renewal of the periodical financial and economic settlement (Ausgleich) in 1877 no important change was made, but in 1882 the system of compulsory service was extended to Bosnia and Herzegovina, and a reorganization was carried out, including the introduction of army corps and local organization on the Prussian plan. This was useful for the purposes of speedy mobilization, though there was some danger that the local and national spirit might penetrate into the army. In 1886 a law was carried in either parliament creating a Landsturm, and providing for the arming and organization of the whole male population up to the age of forty-two in case of emergency, and in 1889 a small increase was made in the annual number of recruits. A further increase was made in 1892-1893. In contrast, however, with the military history of other continental powers, that of Austria-Hungary shows a small increase in the army establishment. Of recent years there have been signs of an attempt to tamper with the use of German as the common language for the whole army. This, which is now the principal remnant of the old ascendancy of German, and the one point of unity for the whole monarchy, is a matter on which the government and the monarch allow no concession, but in the Hungarian parliament protests against it have been raised, and in 1899 and 1900 it was necessary to punish recruits from Bohemia, who answered the roll call in the Czechish zde instead of the German hier.

[Sidenote: The Customs Union.]

In those matters which belong to the periodical and terminable agreement, the most important is the Customs Union, which was established in 1867, and it is convenient to treat separately the commercial policy of the dual state.[10] At first the customs tariff in Austria-Hungary, as in most other countries, was based on a number of commercial treaties with Germany, France, Italy, Great Britain, &c., each of which specified the maximum duties that could be levied on certain articles, and all of which contained a "most favoured nation" clause. The practical result was a system very nearly approaching to the absence of any customs duties, and for the period for which these treaties lasted a revision of the tariff could not be carried out by means of legislation. After the year 1873, a strong movement in favour of protective duties made itself felt among the Austrian manufacturers who were affected by the competition of German, English and Belgian goods, and Austria was influenced by the general movement in economic thought which about this time caused the reaction [v.03 p.0021] against the doctrines of free trade. Hungary, on the other hand, was still in favour of free trade, for there were no important manufacturing industries in that country, and it required a secure market for agricultural produce. After 1875 the commercial treaties expired; Hungary thereupon also gave notice to terminate the commercial union with Austria, and negotiations began as to the principle on which it was to be renewed. This was done during the year 1877, and in the new treaty, while raw material was still imported free of duty, a low duty was placed on textile goods as well as on corn, and the excise on sugar and brandy was raised. All duties, moreover, were to be paid in gold—this at once involving a considerable increase. The tariff treaties with Great Britain and France were not renewed, and all attempts to come to some agreement with Germany broke down, owing to the change of policy which Bismarck was adopting at this period. The result was that the system of commercial treaties ceased, and Austria-Hungary was free to introduce a fresh tariff depending simply on legislation, an "autonomous tariff" as it is called. With Great Britain, France and Germany, there was now only a "most favoured nation" agreement; fresh commercial treaties were made with Italy (1879), Switzerland and Servia (1881). During 1881-1882 Hungary, desiring means of retaliation against the duties on corn and the impediments to the importation of cattle recently introduced into Germany, withdrew her opposition to protective duties; the tariff was completely revised, protective duties were introduced on all articles of home production, and high finance duties on other articles such as coffee and petroleum. At the same time special privileges were granted to articles imported by sea, so as to foster the trade of Trieste and Fiume; as in Germany a subvention was granted to the great shipping companies, the Austrian Lloyd and Adria; the area of the Customs Union was enlarged so as to include Trieste, Istria and Dalmatia, as well as Bosnia and Herzegovina. In 1887 a further increase of duties was laid on corn (this was at the desire of Hungary as against Rumania, for a vigorous customs war was being carried on at this time) and on woollen and textile goods. Austria, therefore, during these years completely gave up the principle of free trade, and adopted a nationalist policy similar to that which prevailed in Germany. A peculiar feature of these treaties was that the government was empowered to impose an additional duty (Retorsionszoll) on goods imported from countries in which Austria-Hungary received unfavourable treatment. In 1881 this was fixed at 10% (5% for some articles), but in 1887 it was raised to 30 and 15% respectively. In 1892 Austria-Hungary joined with Germany, Italy, Belgium, and Switzerland in commercial treaties to last for twelve years, the object being to secure to the states of central Europe a stable and extended market; for the introduction of high tariffs in Russia and America had crippled industry. Two years later Austria-Hungary also arranged with Russia a treaty similar to that already made between Russia and Germany; the reductions in the tariff secured in these treaties were applicable also to Great Britain, with which there still was a most favoured nation treaty. The system thus introduced gave commercial security till the year 1903.

[Sidenote: Reform of the Currency.]

The result of these and other laws was an improvement in financial conditions, which enabled the government at last to take in hand the long-delayed task of reforming the currency. Hitherto the currency had been partly in silver (gulden), the "Austrian currency" which had been introduced in 1857, partly in paper money, which took the form of notes issued by the Austro-Hungarian Bank. This institution had, in 1867, belonged entirely to Austria; it had branches in Hungary, and its notes were current throughout the monarchy, but the direction was entirely Austrian. The Hungarians had not sufficient credit to establish a national bank of their own, and at the settlement of 1877 they procured, as a concession to themselves, that it should be converted into an Austro-Hungarian bank, with a head office at Pest as well as at Vienna, and with the management divided between the two countries. This arrangement was renewed in 1887. In 1848 the government had been obliged to authorize the bank to suspend cash payments, and the wars of 1859 and 1866 had rendered abortive all attempts to renew them. The notes, therefore, formed an inconvertible paper currency. The bank by its charter had the sole right of issuing notes, but during the war of 1866 the government, in order to raise money, had itself issued notes (Staatsnoten) to the value of 312 million gulden, thereby violating the charter of the bank. The operation begun in 1892 was therefore threefold: (1) the substitution of a gold for a silver standard; (2) the redemption of the Staatsnoten; (3) the resumption of cash payments by the bank.

In 1867 Austria-Hungary had taken part in the monetary conference which led to the formation of the Latin Union; it was intended to join the Union, but this was not done. A first step, however, had been taken in this direction by the issue of gold coins of the value of eight and four gulden. No attempt was made, however, to regulate the relations of these coins to the "Austrian" silver coinage; the two issues were not brought into connexion, and every payment was made in silver, unless it was definitely agreed that it should be paid in gold. In 1879, owing to the continued depreciation of silver, the free coinage of silver was suspended. In 1892 laws introducing a completely new coinage were carried in both parliaments, in accordance with agreements made by the ministers. The unit in the new issue was to be the krone, divided into 100 heller; the krone being almost of the same value (24-25th) as the franc. (The twenty-krone piece in gold weighs 6.775 gr., the twenty-franc piece 6.453.) The gold krone was equal to .42 of the gold gulden, and it was declared equal to .5 of the silver gulden, so much allowance being made for the depreciation of silver. The first step towards putting this act into practice was the issue of one-krone pieces (silver), which circulated as half gulden, and of nickel coins; all the copper coins and other silver coins were recalled, the silver gulden alone being left in circulation. The coinage of the gold four- and eight-gulden was suspended. Nothing more could be done till the supply of gold had been increased. The bank was required to buy gold (during 1892 it bought over forty M. gulden), and was obliged to coin into twenty- or ten-krone pieces all gold brought to it for that purpose. Then a loan of 150 M. gulden at 4% was made, and from the gold (chiefly bar gold and sovereigns) which Rothschild, who undertook the loan, paid in, coins of the new issue were struck to the value of over 34 million kronen. This was, however, not put into circulation; it was used first for paying off the Staatsnoten. By 1894 the state was able to redeem them to the amount of 200 million gulden, including all those for one gulden. It paid them, however, not in gold, but in silver (one-krone pieces and gulden) and in bank notes, the coins and notes being provided by the bank, and in exchange the newly-coined gold was paid to the bank to be kept as a reserve to cover the issue of notes. At the same time arrangements were made between Austria and Hungary to pay off about 80 million of exchequer bills which had been issued on the security of the government salt-works, and were therefore called "salinenscheine." In 1899 the remainder of the Staatsnoten (112 million gulden) were redeemed in a similar manner. The bank had in this way acquired a large reserve of gold, and in the new charter which was (after long delay) passed in 1899, a clause was introduced requiring the resumption of cash payments, though this was not to come into operation immediately. Then from 1st January 1900 the old reckoning by gulden was superseded, that by krone being introduced in all government accounts, the new silver being made a legal tender only for a limited amount. For the time until the 1st of July 1908, however, the old gulden were left in circulation, payments made in them, at the rate of two kronen to one gulden, being legal up to any amount.

This important reform has thereby been brought to a satisfactory conclusion, and at a time when the political difficulties had reached a most acute stage. It is indeed remarkable that notwithstanding the complicated machinery of the dual monarchy, and the numerous obstacles which have to be overcome before a reform affecting both countries can be carried out, the financial, the commercial, and the foreign policy has been conducted since 1870 with success. The credit of the state has risen, the chronic deficit has disappeared, the currency has been put on a sound basis, and part of the unfunded debt has been paid off. Universal military service has been introduced, and all this has been done in the presence of difficulties greater than existed in any other civilized country.

[Sidenote: The Ausgleich with Hungary.]

Each of the financial and economic reforms described above was, of course, the subject of a separate law, but, so far as they are determined at the general settlement which takes place between Austria and Hungary every ten years, they are comprised under the expression "Ausgleich" (compact or compromise), which includes especially the determination of the Quota, and to this extent they are all dealt with together as part of a general settlement and bargain. In this settlement a concession on commercial policy would be set off against a gain on the financial agreement; e.g. in 1877 Austria gave Hungary a share in the management of the bank, while the arrangement for paying the bonus on exported sugar was favourable to Austria; on the other hand, since the increased duty on coffee and petroleum would fall more heavily on Austria, the Austrians wished to persuade the Hungarians to pay a larger quota of the common expenses, and there was also a dispute whether Hungary was partly responsible for a debt of 80 M. [v.03 p.0022] gulden to the bank. Each measure had, therefore, to be considered not only on its own merits, but in relation to the general balance of advantage, and an amendment in one might bring about the rejection of all. The whole series of acts had to be carried in two parliaments, each open to the influence of national jealousy and race hatred in its most extreme form, so that the negotiations have been conducted under serious difficulties, and the periodical settlement has always been a time of great anxiety. The first settlement occupied two full years, from 1876, when the negotiations began, to June 1878, when at last all the bills were carried successfully through the two parliaments; and it was necessary to prolong the previous arrangements (which expired at the end of 1877) till the middle of 1878. First the two ministries had to agree on the drafts of all the bills; then the bills had to be laid before the two parliaments. Each parliament elected a committee to consider them, and the two committees carried on long negotiations by notes supplemented by verbal discussions. Then followed the debates in the two parliaments; there was a ministerial crisis in Austria, because the House refused to accept the tax on coffee and petroleum which was recommended by the ministers; and finally a great council of all the ministers, with the emperor presiding, determined the compromise that was at last accepted. In 1887 things went better; there was some difficulty about the tariff, especially about the tax on petroleum, but Count Taaffe had a stronger position than the Austrian ministers of 1877. Ten years later, on the third renewal, the difficulties were still greater. They sprang from a double cause. First the Austrians were determined to get a more favourable division of the common expenses; that of 1867 still continued, although Hungary had grown relatively in wealth.[11] Moreover, a proposed alteration in the taxes on sugar would be of considerable advantage to Hungary; the Austrians, therefore, demanded that henceforth the proportion should be not 68.6:31.4 but 58:42. On this there was a deadlock; all through 1897 and 1898 the Quota-Deputations failed to come to an agreement. This, however, was not the worst. Parliamentary government in Austria had broken down; the opposition had recourse to obstruction, and no business could be done. Their object was to drive out the Badeni government, and for that reason the obstruction was chiefly directed against the renewal of the Ausgleich; for, as this was the first necessity of state, no government could remain in office which failed to carry it through. The extreme parties of the Germans and the anti-Semites were also, for racial reasons, opposed to the whole system. When, therefore, the government at the end of 1897 introduced the necessary measures for prolonging the existing arrangements provisionally till the differences with Hungary had been settled, scenes of great disorder ensued, and at the end of the year the financial arrangements had not been prolonged, and neither the bank charter nor the Customs Union had been renewed. The government, therefore (Badeni having resigned), had to proclaim the necessary measures by imperial warrant. Next year it was even worse, for there was obstruction in Hungary as well as in Austria; the Quota-Deputations again came to no agreement, and the proposals for the renewal of the Bank charter, the reform of the currency, the renewal of the Customs Union, and the new taxes on beer and brandy, which were laid before parliament both at Vienna and Pest, were not carried in either country; this time, therefore, the existing arrangements had to be prolonged provisionally by imperial and royal warrant both in Austria and Hungary. During 1899 parliamentary peace was restored in Hungary by the resignation of Banffy; in Austria, however, though there was again a change of ministry the only result was that the Czechs imitated the example of the Germans and resorted to obstruction so that still no business could be done. The Austrian ministry, therefore, came to an agreement with the Hungarians that the terms of the new Ausgleich should be finally proclaimed in Austria by imperial warrant; the Hungarians only giving their assent to this in return for considerable financial concessions.

The main points of the agreement were: (1) the Bank charter was to be renewed till 1910, the Hungarians receiving a larger share in the direction than they had hitherto enjoyed; (2) the Customs Union so far as it was based on a reciprocal and binding treaty lapsed, both sides, however, continuing it in practice, and promising to do so until the 31st of December 1907. Not later than 1901 negotiations were to be begun for a renewal of the alliance, and if possible it was to be renewed from the year 1903, in which year the commercial treaties would expire. If this were done, then the tariff would be revised before any fresh commercial treaties were made. If it were not done, then no fresh treaties would be made extending beyond the year 1907, so that if the Commercial Union of Austria and Hungary were not renewed before 1907, each party would be able to determine its own policy unshackled by any previous treaties. These arrangements in Hungary received the sanction of the parliament; but this could not be procured in Austria, and they were, therefore, proclaimed by imperial warrant; first of all, on 20th July, the new duties on beer, brandy and sugar; then on 23rd September the Bank charter, &c. In November the Quota-Deputations at last agreed that Hungary should henceforward pay 33-3/49, a very small increase, and this was also in Austria proclaimed in the same way. The result was that a working agreement was made, by which the Union was preserved.

(J. W. HE.)

[Sidenote: Austro-Hungarian crisis, 1903-1907.]

Since the years 1866-1871 no period of Austro-Hungarian development has been so important as the years 1903-1907. The defeat of the old Austria by Prussia at Sadowa in 1866, the establishment of the Dual Monarchy in 1867 and the foundation of the new German empire in 1871, formed the starting-point of Austro-Hungarian history properly so called; but the Austro-Hungarian crisis of 1903-1906—a crisis temporarily settled but not definitively solved,—and the introduction of universal suffrage in Austria, discredited the original interpretation of the dual system and raised the question whether it represented the permanent form of the Austro-Hungarian polity.

At the close of the 19th century both states of the Dual Monarchy were visited by political crises of some severity. Parliamentary life in Austria was paralysed by the feud between Germans and Czechs that resulted directly from the Badeni language ordinances of 1897 and indirectly from the development of Slav influence, particularly that of Czechs and Poles during the Taaffe era (1879-1893). Government in Austria was carried on by cabinets of officials with the help of the emergency clause (paragraph 14) of the constitution. Ministers, nominally responsible to parliament, were in practice responsible only to the emperor. Thus during the closing years of last and the opening years of the present century, political life in Austria was at a low ebb and the constitution was observed in the letter rather than in spirit.

Hungary was apparently better situated. Despite the campaign of obstruction that overthrew the Banffy and led to the formation of the Szell cabinet in 1899, the hegemony of the Liberal party which, under various names, had been the mainstay of dualism since 1867, appeared to be unshaken. But clear signs of the decay of the dualist and of the growth of an extreme nationalist Magyar spirit were already visible. The Army bills of 1889, which involved an increase of the peace footing of the joint Austro-Hungarian army, had been carried with difficulty, despite the efforts of Koloman Tisza and of Count Julius Andrassy the Elder. Demands tending towards the Magyarization of the joint army had been advanced and had found such an echo in Magyar public opinion that Count Andrassy was obliged solemnly to warn the country of the dangers of nationalist Chauvinism and to remind it of its obligations under the Compact of 1867. The struggle over the civil marriage and divorce laws that filled the greater part of the nineties served and was perhaps intended by the Liberal leaders to serve as a diversion in favour of the Liberal-dualist standpoint; nevertheless, Nationalist feeling found strong expression during the negotiations of Banffy and Szell with various Austrian premiers for the renewal of the economic Ausgleich, or "Customs and Trade Alliance." At the end of 1902 the Hungarian premier, Szell, concluded with the Austrian premier, Koerber, a new customs and trade alliance [v.03 p.0023] comprising a joint Austro-Hungarian tariff as a basis for the negotiation of new commercial treaties with Germany, Italy and other states. This arrangement, which for the sake of brevity will henceforth be referred to as the Szell-Koerber Compact, was destined to play an important part in the history of the next few years, though it was never fully ratified by either parliament and was ultimately discarded. Its conclusion was prematurely greeted as the end of a period of economic strife between the two halves of the monarchy and as a pledge of a decade of peaceful development. Events were soon to demonstrate the baselessness of these hopes.

[Sidenote: The Army question.]

In the autumn of 1902 the Austrian and the Hungarian governments, at the instance of the crown and in agreement with the joint minister for war and the Austrian and Hungarian ministers for national defence, laid before their respective parliaments bills providing for an increase of 21,000 men in the annual contingents of recruits. 16,700 men were needed for the joint army, and the remainder for the Austrian and Hungarian national defence troops (Landwehr and honved). The total contribution of Hungary would have been some 6500 and of Austria some 14,500 men. The military authorities made, however, the mistake of detaining in barracks several thousand supernumerary recruits (i.e. recruits liable to military service but in excess of the annual 103,000 enrollable by law) pending the adoption of the Army bills by the two parliaments. The object of this apparently high-handed step was to avoid the expense and delay of summoning the supernumeraries again to the colours when the bills should have received parliamentary sanction; but it was not unnaturally resented by the Hungarian Chamber, which has ever possessed a lively sense of its prerogatives. The Opposition, consisting chiefly of the independence party led by Francis Kossuth (eldest son of Louis Kossuth), made capital out of the grievance and decided to obstruct ministerial measures until the supernumeraries should be discharged. The estimates could not be sanctioned, and though Kossuth granted the Szell cabinet a vote on account for the first four months of 1903, the Government found itself at the mercy of the Opposition. At the end of 1902 the supernumeraries were discharged—too late to calm the ardour of the Opposition, which proceeded to demand that the Army bills should be entirely withdrawn or that, if adopted, they should be counterbalanced by concessions to Magyar nationalist feeling calculated to promote the use of the Magyar language in the Hungarian part of the army and to render the Hungarian regiments, few of which are purely Magyar, more and more Magyar in character. Szell, who vainly advised the crown and the military authorities to make timely concessions, was obliged to reject these demands which enjoyed the secret support of Count Albert Apponyi, the Liberal president of the Chamber and of his adherents. The obstruction of the estimates continued. On the 1st of May the Szell cabinet found itself without supply and governed for a time "ex-lex"; Szell, who had lost the confidence of the crown, resigned and was succeeded (June 26) by Count Khuen-Hedervary, previously ban, or governor, of Croatia. Before taking office Khuen-Hedervary negotiated with Kossuth and other Opposition leaders, who undertook that obstruction should cease if the Army bills were withdrawn. Despite the fact that the Austrian Army bill had been voted by the Reichsrath (February 19), the crown consented to withdraw the bills and thus compelled the Austrian parliament to repeal, at the dictation of the Hungarian obstructionists, what it regarded as a patriotic measure. Austrian feeling became embittered towards Hungary and the action of the crown was openly criticized.

[Sidenote: The Magyar words of command.]

Meanwhile the Hungarian Opposition broke its engagement. Obstruction was continued by a section of the independence party; and Kossuth, seeing his authority ignored, resigned the leadership. The obstructionists now raised the cry that the German words of command in the joint army must be replaced by Magyar words in the regiments recruited from Hungary—a demand which, apart from its disintegrating influence on the army, the crown considered to be an encroachment upon the royal military prerogatives as defined by the Hungarian Fundamental Law XII. of 1867. Clause 11 of the law runs:—"In pursuance of the constitutional military prerogatives of His Majesty, everything relating to the unitary direction, leadership and inner organization of the whole army, and thus also of the Hungarian army as a complementary part of the whole army, is recognized as subject to His Majesty's disposal." The cry for the Magyar words of command on which the subsequent constitutional crisis turned, was tantamount to a demand that the monarch should differentiate the Hungarian from the Austrian part of the joint army, and should render it impossible for any but Magyar officers to command Hungarian regiments, less than half of which have a majority of Magyar recruits. The partisans of the Magyar words of command based their claim upon clause 12 of the Fundamental Law XII. of 1867—which runs:—"Nevertheless the country reserves its right periodically to complete the Hungarian army and the right of granting recruits, the fixing of the conditions on which the recruits are granted, the fixing of the term of service and all the dispositions concerning the stationing and the supplies of the troops according to existing law both as regards legislation and administration." Since Hungary reserved her right to fix the conditions on which recruits should be granted, the partisans of the Magyar words of command argued that the abolition of the German words of command in the Hungarian regiments might be made such a condition, despite the enumeration in the preceding clause 11, of everything appertaining to the unitary leadership and inner organization of the joint Austro-Hungarian army as belonging to the constitutional military prerogatives of the crown. Practically, the dispute was a trial of strength between Magyar nationalist feeling and the crown. Austrian feeling strongly supported the monarch in his determination to defend the unity of the army, and the conflict gradually acquired an intensity that appeared to threaten the very existence of the dual system.

When Count Khuen-Hedervary took office and Kossuth relinquished the leadership of the independence party, the extension of the crisis could not be foreseen. A few extreme nationalists continued to obstruct the estimates, and it appeared as though their energy would soon flag. An attempt to quicken this process by bribery provoked, however, an outburst of feeling against Khuen-Hedervary who, though personally innocent, found his position shaken. Shortly afterwards Magyar resentment of an army order issued from the cavalry manoeuvres at Chlopy in Galicia—in which the monarch declared that he would "hold fast to the existing and well-tried organization of the army" and would never "relinquish the rights and privileges guaranteed to its highest war-lord"; and of a provocative utterance of the Austrian premier Koerber in the Reichsrath led to the overthrow of the Khuen-Hedervary cabinet (September 30) by an immense majority. The cabinet fell on a motion of censure brought forward by Kossuth, who had profited by the bribery incident to resume the leadership of his party.

[Sidenote: Stephen Tisza.]

An interval of negotiation between the crown and many leading Magyar Liberals followed, until at the end of October 1903 Count Stephen Tisza, son of Koloman Tisza, accepted a mission to form a cabinet after all others had declined. As programme Tisza brought with him a number of concessions from the crown to Magyar nationalist feeling in regard to military matters, particularly in regard to military badges, penal procedure, the transfer of officers of Hungarian origin from Austrian to Hungarian regiments, the establishment of military scholarships for Magyar youths and the introduction of the two years' service system. In regard to the military language, the Tisza programme—which, having been drafted by a committee of nine members, is known as the "programme of the nine"—declared that the responsibility of the cabinet extends to the military prerogatives of the crown, and that "the legal influence of parliament exists in this respect as in respect of every constitutional right." The programme, however, expressly excluded for "weighty political reasons affecting great interests of the nation" the question of the military [v.03 p.0024] language; and on Tisza's motion the Liberal party adopted an addendum, sanctioned by the crown: "the party maintains the standpoint that the king has a right to fix the language of service and command in the Hungarian army on the basis of his constitutional prerogatives as recognized in clause 11 of law XII. of 1867."

Notwithstanding the concessions, obstruction was continued by the Clericals and the extreme Independents, partly in the hope of compelling the crown to grant the Magyar words of command and partly out of antipathy towards the person of the young calvinist premier. In March 1904, Tisza, therefore, introduced a drastic "guillotine" motion to amend the standing orders of the House, but withdrew it in return for an undertaking from the Opposition that obstruction would cease. This time the Opposition kept its word. The Recruits bill and the estimates were adopted, the Delegations were enabled to meet at Budapest—where they voted L22,000,000 as extraordinary estimates for the army and navy and especially for the renewal of the field artillery—and the negotiations for new commercial treaties with Germany and Italy were sanctioned, although parliament had never been able to ratify the Szell-Koerber compact with the tariff on the basis of which the negotiations would have to be conducted. But, as the autumn session approached, Tisza foresaw a new campaign of obstruction, and resolved to revert to his drastic reform of the standing orders. The announcement of his determination caused the Opposition to rally against him, and when on the 18th of November the Liberal party adopted a "guillotine" motion by a show of hands in defiance of orthodox procedure, a section of the party seceded. On the 13th of December the Opposition, infuriated by the formation of a special corps of parliamentary constables, invaded and wrecked the Chamber. Tisza appealed to the country and suffered, on the 26th of January 1905, an overwhelming defeat at the hands of a coalition composed of dissentient Liberals, Clericals, Independents and a few Banffyites. The Coalition gained an absolute majority and the Independence party became the strongest political group. Nevertheless the various adherents of the dual system retained an actual majority in the Chamber and prevented the Independence party from attempting to realize its programme of reducing the ties between Hungary and Austria to the person of the joint ruler. On the 25th of January, the day before his defeat, Count Tisza had signed on behalf of Hungary the new commercial treaties concluded by the Austro-Hungarian foreign office with Germany and Italy on the basis of the Szell-Koerber tariff. He acted ultra vires, but by his act saved Hungary from a severe economic crisis and retained for her the right to benefit by economic partnership with Austria until the expiry of the new treaties in 1917.

[Sidenote: Deadlock of 1905.]

A deadlock, lasting from January 1905 until April 1906, ensued between the crown and Hungary and, to a great extent, between Hungary and Austria. The Coalition, though possessing the majority in the Chamber, resolved not to take office unless the crown should grant its demands, including the Magyar words of command and customs separation from Austria. The crown declined to concede these points, either of which would have wrecked the dual system as interpreted since 1867. The Tisza cabinet could not be relieved of its functions till June 1905, when it was succeeded by a non-parliamentary administration under the premiership of General Baron Fejervary, formerly minister for national defence. Seeing that the Coalition would not take office on acceptable terms, Fejervary obtained the consent of the crown to a scheme, drafted by Kristoffy, minister of the interior, that the dispute between the crown and the Coalition should be subjected to the test of universal suffrage and that to this end the franchise in Hungary be radically reformed. The scheme alarmed the Coalition, which saw that universal suffrage might destroy not only the hegemony of the Magyar nobility and gentry in whose hands political power was concentrated, but might, by admitting the non-Magyars to political equality with the Magyars, undermine the supremacy of the Magyar race itself. Yet the Coalition did not yield at once. Not until the Chamber had been dissolved by military force (February 19, 1906) and an open breach of the constitution seemed within sight did they come to terms with the crown and form an administration. The miserable state of public finances and the depression of trade doubtless helped to induce them to perform a duty which they ought to have performed from the first; but their chief motive was the desire to escape the menace of universal suffrage or, at least, to make sure that it would be introduced in such a form as to safeguard Magyar supremacy over the other Hungarian races.

[Sidenote: Pact of 1906.]

The pact concluded (April 8, 1906) between the Coalition and the crown is known to have contained the following conditions:—All military questions to be suspended until after the introduction of universal suffrage; the estimates and the normal contingent of recruits to be voted for 1905 and 1906; the extraordinary military credits, sanctioned by the delegations in 1904, to be voted by the Hungarian Chamber; ratification of the commercial treaties concluded by Tisza; election of the Hungarian Delegation and of the Quota-Deputation; introduction of a suffrage reform at least as far reaching as the Kristoffy scheme. These "capitulations" obliged the Coalition government to carry on a dualist policy, although the majority of its adherents became, by the general election of May 1906, members of the Kossuth or Independence party, and, as such, pledged to the economic and political separation of Hungary from Austria save as regards the person of the ruler. Attempts were, however, made to emphasize the independence of Hungary. During the deadlock (June 2, 1905) Kossuth had obtained the adoption of a motion to authorize the compilation of an autonomous Hungarian tariff, and on the 28th of May 1906, the Coalition cabinet was authorized by the crown to present the Szell-Koerber tariff to the Chamber in the form of a Hungarian autonomous tariff distinct from but identical with the Austrian tariff. This concession of form having been made to the Magyars without the knowledge of the Austrian government, Prince Konrad Hohenlohe, the Austrian premier, resigned office; and his successor, Baron Beck, eventually (July 6) withdrew from the table of the Reichsrath the whole Szell-Koerber compact, declaring that the only remaining economic ties between the two countries were freedom of trade, the commercial treaties with foreign countries, the joint state bank and the management of excise. If the Hungarian government wished to regulate its relationship to Austria in a more definite form, added the Austrian premier, it must conclude a new agreement before the end of the year 1907, when the reciprocity arrangement of 1899 would lapse. The Hungarian government replied that any new arrangement with Austria must be concluded in the form of a commercial treaty as between two foreign states and not in the form of a "customs and trade alliance."

[Sidenote: Agreement of 1907.]

Austria ultimately consented to negotiate on this basis. In October 1907 an agreement was attained, thanks chiefly to the sobering of Hungarian opinion by a severe economic crisis, which brought out with unusual clearness the fact that separation from Austria would involve a period of distress if not of commercial ruin for Hungary. Austria also came to see that separation from Hungary would seriously enhance the cost of living in Cisleithania and would deprive Austrian manufacturers of their best market. The main features of the new "customs and commercial treaty" were: (1) Each state to possess a separate but identical customs tariff. (2) Hungary to facilitate the establishment of direct railway communication between Vienna and Dalmatia, the communication to be established by the end of 1911, each state building the sections of line that passed through its own territory. (3) Austria to facilitate railway communication between Hungary and Prussia. (4) Hungary to reform her produce and Stock Exchange laws so as to prevent speculation in agrarian produce. (5) A court of arbitration to be established for the settlement of differences between the two states, Hungary selecting four Austrian and Austria four Hungarian judges, the presidency of the court being decided by lot, and each government being represented before the court by its own delegates. (6) Impediments [v.03 p.0025] to free trade in sugar to be practically abolished. (7) Hungary to be entitled to redeem her share of the old Austrian debt (originally bearing interest at 5 and now at 4.2%) at the rate of 4.325% within the next ten years; if not redeemed within ten years the rate of capitalization to decrease annually by 1/12% until it reaches 4.2%. This arrangement represents a potential economy of some L2,000,000 capital for Hungary as compared with the original Austrian demand that the Hungarian contribution to the service of the old Austrian debt be capitalized at 4.2%. (8) The securities of the two governments to rank as investments for savings banks, insurance companies and similar institutions in both countries, but not as trust fund investments. (9) Commercial treaties with foreign countries to be negotiated, not, as hitherto, by the joint minister for foreign affairs alone, but also by a nominee of each government. (10) The quota of Austrian and Hungarian contribution to joint expenditure to be 63.6 and 36.4 respectively—an increase of 2% in the Hungarian quota, equal to some L200,000 a year.

The economic dispute between Hungary and Austria was thus settled for ten years after negotiations lasting more than twelve years. One important question, however, that of the future of the joint State Bank, was left over for subsequent decision. During the negotiations for the customs and commercial treaty, the Austrian government attempted to conclude for a longer period than ten years, but was unable to overcome Hungarian resistance. Therefore, at the end of 1917, the commercial treaties with Germany, Italy and other countries, and the Austro-Hungarian customs and commercial treaty, would all lapse. Ten years of economic unity remained during which the Dual Monarchy might grow together or grow asunder, increasing accordingly in strength or in weakness.

(H. W. S.)

During this period of internal crisis the international position of the Dual Monarchy was threatened by two external dangers. The unrest in Macedonia threatened to reopen the Eastern Question in an acute form; with Italy the irredentist attitude of the Zanardelli cabinet led in 1902-1903 to such strained relations that war seemed imminent. The southern Tirol, the chief passes into Italy, strategic points on the Istrian and Dalmatian coasts, were strongly fortified, while in the interior the Tauern, Karawanken and Wochein railways were constructed, partly in order to facilitate the movement of troops towards the Italian border. The tension was relaxed with the fall of the Zanardelli government, and comparatively cordial relations were gradually re-established.

[Sidenote: Balkan crisis.]

In the affairs of the Balkan Peninsula a temporary agreement with Russia was reached in 1903 by the so-called "February Programme," supplemented in the following October by the "Muerzsteg Programme" (see MACEDONIA; TURKEY; EUROPE: History). The terms of the Muerzsteg programme were observed by Count Goluchowski, in spite of the ruin of Russian prestige in the war with Japan, so long as he remained in office. In October 1906, however, he retired, and it was soon clear that his successor, Baron von Aerenthal,[12] was determined to take advantage of the changed European situation to take up once more the traditional policy of the Habsburg monarchy in the Balkan Peninsula. He gradually departed from the Muerzsteg basis, and in January 1908 deliberately undermined the Austro-Russian agreement by obtaining from the sultan a concession for a railway from the Bosnian frontier through the sanjak of Novibazar to the Turkish terminus at Mitrovitza. This was done in the teeth of the expressed wish of Russia; it roused the helpless resentment of Servia, whose economic dependence upon the Dual Monarchy was emphasized by the outcome of the war of tariffs into which she had plunged in 1906, and who saw in this scheme another link in the chain forged for her by the Habsburg empire; it offended several of the great powers, who seemed to see in this railway concession the price of the abandonment by Austria-Hungary of her interest in Macedonian reforms. That Baron von Aerenthal was able to pursue a policy apparently so rash, was due to the fact that he could reckon on the support of Germany. The intimate relations between the two powers had been revealed during the dispute between France and Germany about Morocco; in the critical division of the 3rd of March 1906 at the Algeciras Conference Austria-Hungary, alone of all the powers, had sided with Germany, and it was a proposal of the Austro-Hungarian plenipotentiary that formed the basis of the ultimate settlement between Germany and France (see MOROCCO: History). The cordial relations thus emphasized encouraged Baron Aerenthal, in the autumn of 1908, to pursue a still bolder policy. The revolution in Turkey had entirely changed the face of the Eastern Question; the problem of Macedonian reform was swallowed up in that of the reform of the Ottoman empire generally, there was even a danger that a rejuvenated Turkey might in time lay claim to the provinces occupied by Austria-Hungary under the treaty of Berlin; in any case, the position of these provinces, governed autocratically from Vienna, between a constitutional Turkey and a constitutional Austria-Hungary, would have been highly anomalous. In the circumstances Baron Aerenthal determined on a bold policy. Without consulting the co-signatory powers of the treaty of Berlin, and in deliberate violation of its provisions, the king-emperor issued, on the 13th of October, a decree annexing Bosnia and Herzegovina to the Habsburg Monarchy, and at the same time announcing the withdrawal of the Austro-Hungarian troops from the sanjak of Novibazar. (See EUROPE: History.)

[Sidenote: Internal difficulties.]

Meanwhile the relations between the two halves of the Dual Monarchy had again become critical. The agreement of 1907 had been but a truce in the battle between two irreconcilable principles: between Magyar nationalism, determined to maintain its ascendancy in an independent Hungary, and Habsburg imperialism, equally determined to preserve the economic and military unity of the Dual Monarchy. In this conflict the tactical advantage lay with the monarchy; for the Magyars were in a minority in Hungary, their ascendancy was based on a narrow and artificial franchise, and it was open to the king-emperor to hold in terrorem over them an appeal to the disfranchised majority. It was the introduction of a Universal Suffrage Bill by Mr Joseph Kristoffy, minister of the interior in the "unconstitutional" cabinet of Baron Fejervary, which brought the Opposition leaders in the Hungarian parliament to terms and made possible the agreement of 1907. But the Wekerle ministry which succeeded that of Fejervary on the 9th of April 1906 contained elements which made any lasting compromise impossible. The burning question of the "Magyar word of command" remained unsettled, save in so far as the fixed determination of the king-emperor had settled it; the equally important question of the renewal of the charter of the Austro-Hungarian State Bank had also formed no part of the agreement of 1907. On the other hand, the Wekerle ministry was pledged to a measure of franchise reform, a pledge which they showed no eagerness to redeem, though the granting of universal suffrage in the Austrian half of the Monarchy had made such a change inevitable. In March 1908 Mr Hallo laid before the Hungarian parliament a formal proposal that the charter of the Austro-Hungarian Bank, which was to expire at the end of 1910, should not be renewed; and that, in the event of failure to negotiate a convention between the banks of Austria and Hungary, a separate Hungarian Bank should be established. This question, obscured during the winter by the Balkan crisis, once more became acute in the spring of 1909. In the Coalition cabinet itself opinion was sharply divided, but in the end the views of the Independence party prevailed, and Dr Wekerle laid the proposal for a separate Hungarian Bank before the king-emperor and the Austrian government. Its reception was significant. The emperor Francis Joseph pointed out that the question of a separate Bank for Hungary [v.03 p.0026] did not figure in the act of 1867, and could not be introduced into it, especially since the capital article of the ministerial programme, i.e. electoral reform, was not realized, nor near being realized. This was tantamount to an appeal from the Magyar populus to the Hungarian plebs, the disfranchised non-Magyar majority; an appeal all the more significant from the fact that it ignored the suffrage bill brought in on behalf of the Hungarian government by Count Julius Andrassy in November 1908, a bill which, under the guise of granting the principle of universal suffrage, was ingeniously framed so as to safeguard and even to extend Magyar ascendancy (see HUNGARY: History). In consequence of this rebuff Dr Wekerle tendered his resignation on the 27th of April. Months passed without it being possible to form a new cabinet, and a fresh period of crisis and agitation was begun.

(W. A. P.)

II. Austria Proper since 1867.

As already explained, the name Austria is used for convenience to designate those portions of the possessions of the house of Habsburg, which were not included by the settlement of 1867 among the lands of the Hungarian crown. The separation of Hungary made it necessary to determine the method by which these territories[13] were henceforth to be governed. It was the misfortune of the country that there was no clear legal basis on which new institutions could be erected. Each of the territories was a separate political unit with a separate history, and some of them had a historic claim to a large amount of self-government; in many the old feudal estates had survived till 1848. [Sidenote: The February Constitution.] Since that year the empire had been the subject of numerous experiments in government; by the last, which began in 1860, Landtage or diets have been instituted in each of the territories on a nearly uniform system and with nearly identical powers, and by the constitution published in February 1861 (the February Constitution, as it is called), which is still the ultimate basis for the government, there was instituted a Reichsrath or parliament for the whole empire; it consisted of a House of Lords (Herrenhaus), in which sat the archbishops and prince bishops, members of the imperial family, and other members appointed for life, besides some hereditary members, and a Chamber of Deputies. The members of the latter for each territory were not chosen by direct election, but by the diets. The diets themselves were elected for six years; they were chosen generally (there were slight local differences) in the following way: (a) a certain number of bishops and rectors of universities sat in virtue of their office; (b) the rest of the members were chosen by four electoral bodies or curiae,—(1) the owners of estates which before 1848 had enjoyed certain feudal privileges, the so-called great proprietors; (2) the chambers of commerce; (3) the towns; (4) the rural districts. In the two latter classes all had the suffrage who paid at least ten gulden in direct taxes. The districts were so arranged as to give the towns a very large representation in proportion to their populations. In Bohemia, e.g., the diet consisted of 241 members: of these five were ex officio members; the feudal proprietors had seventy; the towns and chambers of commerce together had eighty-seven; the rural districts seventy-nine. The electors in the rural districts were 236,000, in the towns 93,000. This arrangement seems to have been deliberately made by Schmerling, so as to give greater power to the German inhabitants of the towns; the votes of the proprietors would, moreover, nearly always give the final decision to the court and the government, for the influence exercised by the government over the nobility would generally be strong enough to secure a majority in favour of the government policy.

This constitution had failed; territories so different in size, history and circumstances were not contented with similar institutions, and a form of self-government which satisfied Lower Austria and Salzburg did not satisfy Galicia and Bohemia. The Czechs of Bohemia, like the Magyars, had refused to recognize the common parliament on the ground that it violated the historic rights of the Bohemian as of the Hungarian crown, and in 1865 the constitution of 1861 had been superseded, while the territorial diets remained. In 1867 it was necessary once more to summon, in some form or another, a common parliament for the whole of Austria, by which the settlement with Hungary could be ratified.

[Sidenote: Centralists and Federalists.]

This necessity brought to a decisive issue the struggle between the parties of the Centralists and Federalists. The latter claimed that the new constitution must be made by agreement with the territories; the former maintained that the constitution of 1861 was still valid, and demanded that in accordance with it the Reichsrath should be summoned and a "constitutional" government restored. The difference between the two parties was to a great extent, though not entirely, one of race. The kernel of the empire was the purely German district, including Upper and Lower Austria, Salzburg, Tirol (except the south) and Vorarlberg, all Styria except the southern districts, and a large part of Carinthia. There was strong local feeling, especially in Tirol, but it was local feeling similar to that which formerly existed in the provinces of France; among all classes and parties there was great, loyalty both to the ruling house and to the idea of the Austrian state; but while the Liberal party, which was dominant in Lower Austria and Styria, desired to develop the central institutions, there was a strong Conservative and Clerical party which supported local institutions as a protection against the Liberal influence of a centralized parliament and bureaucracy, and the bishops and clergy were willing to gain support in the struggle by alliance with the Federalists.

[Sidenote: The Slavonic Lands.]

Very different was it in the other territories where the majority of the population was not German—and where there was a lively recollection of the time when they were not Austrian. With Palacky, they said, "We existed before Austria; we shall continue to exist after it is gone." Especially was this the case in Bohemia. In this great country, the richest part of the Austrian dominions, where over three-fifths of the population were Czech, racial feeling was supported by the appeal to historic law. A great party, led by Palacky and Rieger, demanded the restoration of the Bohemian monarchy in its fullest extent, including Moravia and Silesia, and insisted that the emperor should be crowned as king of Bohemia at Prague as his predecessors had been, and that Bohemia should have a position in the monarchy similar to that obtained by Hungary. Not only did the party include all the Czechs, but they were supported by many of the great nobles who were of German descent, including Count Leo Thun, his brother-in-law Count Heinrich Clam-Martinitz, and Prince Friedrich von Schwarzenberg, cardinal archbishop of Prague, who hoped in a self-governing kingdom of Bohemia to preserve that power which was threatened by the German Liberals. The feudal nobles had great power arising from their wealth, the great traditions of their families, and the connexion with the court, and by the electoral law they had a large number of representatives in the diet. On the other hand the Germans of Bohemia, fearful of falling under the control of the Czechs, were the most ardent advocates of centralization. The Czechs were supported also by their fellow-countrymen in Moravia, and some of the nobles, headed by Count Belcredi, brother of the minister; but in Bruenn there was a strong German party. In Silesia the Germans had a considerable majority, and as [v.03 p.0027] there was a large Polish element which did not support the Czechs, the diet refused to recognize the claims of the Bohemians.

The Poles of Galicia stood apart from the other Slav races. The German-speaking population was very small, consisting chiefly of government officials, railway servants and Jews; but there was a large minority (some 43%) of Ruthenes. The Poles wished to gain as much autonomy as they could for their own province, but they had no interest in opposing the centralization of other parts; they were satisfied if Austria would surrender the Ruthenes to them. They were little influenced by the pan-Slav agitation; it was desirable for them that Austria, which gave them freedom and power, should continue strong and united. Their real interests were outside the monarchy, and they did not cease to look forward to a restoration of the Polish kingdom. The great danger was that they might entangle Austria in a war with Russia.

The southern Slavs had neither the unity, nor the organization, nor the historical traditions of the Czechs and Poles; but the Slovenes, who formed a large majority of the population in Carniola, and a considerable minority in the adjoining territory of Carinthia and the south of Styria, demanded that their language should be used for purposes of government and education. Their political ideal was an "Illyrian" kingdom, including Croatia and all the southern Slavs in the coast district, and a not very successful movement had been started to establish a so-called Illyrian language, which should be accepted by both Croats and Slovenes. There was, however, another element in the southern districts, viz. the Serbs, who, though of the same race and language as the Croats, were separated from them by religion. Belonging to the Orthodox Church they were attracted by Russia. They were in constant communication with Servia and Montenegro; and their ultimate hope, the creation of a great Servian kingdom, was less easy to reconcile with loyalty to Austria. Of late years attempts have been made to turn the Slovenian national movement into this direction, and to attract the Slovenes also towards the Orthodox non-Austrian Slavs.

[Sidenote: South Dalmatia.]

In the extreme south of Dalmatia is a small district which had not formed part of the older duchy of Dalmatia, and had not been joined to the Austrian empire till 1814; in former years part of it formed the republic of Ragusa, and the rest belonged to Albania. The inhabitants of this part, who chiefly belonged to the Greek Church, still kept up a close connexion with Albania and with Montenegro, and Austrian authority was maintained with difficulty. Disturbances had already broken out once before; and in 1869 another outbreak took place. This district had hitherto been exempted from military service; by the law of 1869, which introduced universal military service, those who had hitherto been exempted were required to serve, not in the regular army but in the militia. The inhabitants of the district round the Bocche di Cattaro (the Bocchesi, as they are commonly called) refused to obey this order, and when a military force was sent it failed to overcome their resistance; and by an agreement made at Knezlac in December 1869, Rodics, who had taken command, granted the insurgents all they asked and a complete amnesty. After the conquest of Bosnia another attempt was made to enforce military service; once more a rebellion broke out, and spread to the contiguous districts of Herzegovina. This time, however, the government, whose position in the Balkans had been much strengthened by the occupation of the new provinces, did not fear to act with decision. A considerable force was sent under General Baron Stephan von Jovanovich (1828-1885); they were supported from sea by the navy, and eventually the rebellion was crushed. An amnesty was proclaimed, but the greater number of the insurgents sought refuge in Montenegro rather than submit to military service.

The Italians of Trieste and Istria were the only people of the empire who really desired separation from Austria; annexation to Italy was the aim of the Italianissimi, as they were called. The feeling was less strong in Tirol, where, except in the city of Trent, they seem chiefly to have wished for separate local institutions, so that they should no longer be governed from Innsbruck. The Italian-speaking population on the coast of Dalmatia only asked that the government should uphold them against the pressure of the Slav races in the interior, and for this reason were ready to support the German constitutionalists.

[Sidenote: German Constitutional party.]

The party of centralization was then the Liberal German party, supported by a few Italians and the Ruthenes, and as years went by it was to become the National German party. They hoped by a common parliament to create the feeling of a common Austrian nationality, by German schools to spread the use of the German language. Every grant of self-government to the territories must diminish the influence of the Germans, and bring about a restriction in the use of the German language; moreover, in countries such as Bohemia, full self-government would almost certainly mean that the Germans would become the subject race. This was a result which they could not accept. It was intolerable to them that just at the time when the national power of the non-Austrian Germans was so greatly increased, and the Germans were becoming the first race in Europe, they themselves should resign the position as rulers which they had won during the last three hundred years. They maintained, moreover, that the ascendancy of the Germans was the only means of preserving the unity of the monarchy; German was the only language in which the different races could communicate with one another; it must be the language of the army, the civil service and the parliament. They laid much stress on the historic task of Austria in bringing German culture to the half-civilized races of the east. They demanded, therefore, that all higher schools and universities should remain German, and that so far as possible the elementary schools should be Germanized. They looked on the German schoolmaster as the apostle of German culture, and they looked forward to the time when the feeling of a common Austrian nationality should obscure the national feeling of the Slavs, and the Slavonic idioms should survive merely as the local dialects of the peasantry, the territories becoming merely the provinces of a united and centralized state. The total German population was not quite a third of the whole. The maintenance of their rule was, therefore, only possible by the exercise of great political ability, the more so, since, as we have seen, they were not united among themselves, the clergy and Feudal party being opposed to the Liberals. Their watchword was the constitution of 1861, which had been drawn up by their leaders; they demanded that it should be restored, and with it parliamentary government. They called themselves, therefore, the Constitutional party. But the introduction of parliamentary government really added greatly to the difficulty of the task before them. In the old days German ascendancy had been secured by the common army, the civil service and the court. As soon, however, as power was transferred to a parliament, the Germans must inevitably be in a minority, unless the method of election was deliberately arranged so as to give them a majority. Parliamentary discussion, moreover, was sure to bring out those racial differences which it was desirable should be forgotten, and the elections carried into every part of the empire a political agitation which was very harmful when each party represented a different race.

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