5: Establishment of The Dual Monarchy
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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 Nádasdy,
supporters of the February constitution, by Count Majláth, 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 a 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. 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. Deák and the majority agreed, however, that there should be certain
institutions common to Hungary and the rest of the monarchy; these where - (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.
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 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 aDelegations, consisting of sixty members; to these
Delegation 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.
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 29½ 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.
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 Königlich), 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-Königlich;
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 Andrássy 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-Königlich, 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 Königlich for joint affairs; the Kaiserlich-Königlich for
Austrian affairs; the Királyé for Hungary, 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.
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 Königgratz 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 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 war- like policy. In 1870 there were discussions
preparatory to a formal alliance with France against the North German Confederation, but
nothing was signed. The war of 1870 put an end to all ideas of this kind; the German
successes were so rapid that Austria was not opposed 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 Andrássy, 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.
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