In 1806 the Holy Roman Empire was brought to an end following Napoleon’s victories over the Austrians. The last of the Holy Roman Emperors, Francis II, was now Francis I of Austria. After the fall of Napoleon (1814-15), Austria became once more the leader of the German states but following the Austro-Prussian War of 1866 she was expelled from the German Confederation.
Austria’s defeat at the hands of Prussia caused Emperor Franz Joseph (above; photographed in 1910) to reorient his policy toward the east and to consolidate his multi-national empire. Austrian liberals, too realized that the dream of Großdeutschland. was over. Even before the war the Hungarians had been restive; now they had their opportunity.
In May and June 1867 the Ausgleich (‘Compromise’) was ratified by the Austrian and Hungarian Parliaments. This brought into being the new state of Austria-Hungary, also known as the Dual Monarchy. The other peoples of the Empire were never consulted.
The new state consisted of Hungary and Cisleithania ('the lands outside the kingdom of Hungary'). Hungary received full internal autonomy, together with a responsible ministry, and, in return, agreed that the empire should still be a unitary state for purposes of war and foreign affairs. Franz Joseph thus surrendered his right to decide Hungarian domestic policy including his earlier responsibility to protect the non-Magyar peoples of Hungary in exchange for the maintenance of dynastic prestige abroad. The so-called common monarchy consisted of the emperor and his court, the Foreign and Finance Ministers and the War Minister. There was no common Prime Minister (other than the Emperor himself) and no common cabinet. The common affairs were to be considered at the Delegations, composed of an equal number of representatives from the two parliaments. There was to be a customs union and a sharing of accounts, which was to be revised every 10 years.
The arrangement suited Hungary, which was now an equal partner with Austria. The kingdom was expanded to include Transylvania while the old Croatian-Slavonian military frontier was abolished and absorbed by Hungary. Franz Joseph was crowned King of Hungary on 8 June 1867. The Hungarians always insisted that he was not their Emperor and that his official title was Kaiser und König. But the rest of the Empire had no clear unity and was technically known as ‘the kingdoms and lands represented in the Reichsrat’ or, more shortly, as ‘the other Imperial half’. All that united these scattered lands and varied ethnic groups was the House of Habsburg. The justification for the monarchy was foreign policy.
Austria formed the northern borders of the monarchy. Its major peoples were Germans, Czechs and Poles. The Germans believed they possessed a superior culture and their attempts to ‘Germanise’ other races brought them into conflict with the Czechs and Poles. The Czechs, the inhabitants of the old Kingdom of Bohemia, were the only Slav peoples within the monarchy. They resented the dominance of the German language and the favourable treatment given to the Hungarians. In Illyria in the southern borders of Austria there were Italians, Croats and Slovenes.
Gyula Andrássy declared,
'the Slavs are not fit to govern; they must be ruled.' Quoted Michael Rapport, Nineteenth-Century Europe (Palgrave, 2005, p. 210).The Nationality Law, passed by the Hungarian Diet in 1868 made Magyar the official language of state. In the old Hungarian kingdom, there were minorities of Rumanians, Ruthenes, Slovaks and Germans, all ignored by their Hungarian rulers. Hungary also included Croatia-Slavonia, with their majority Croat and Serb populations. In 1913 less than half the total Hungarian population was Magyar, but over 80% of all students graduating from high school in Hungary were Magyars and over 95% of government officials.
[I have received the following correction from someone who knows far more about this subject than I do, so I will give it in full. It represents a different point of view that needs to be taken into account.]
'This Nationality Law was the most modern in Europe at that time. It granted wider local autonomy to e.g. the Romanians than Hungarians living in Romania today now have. For example, in the Hungarian-dominated Transylvania there were more Romanian schools (more than 3,000) than in Muntenia and Moldova (two Romanian provinces united in 1859 and 1864 under the name of of Romania altogether. These facts are not evident for Western historians because of the strong anti-Hungarian propaganda that started to work from the second half of the nineteenth century and is still working.'
Outside the sophisticated cities of Vienna, Prague and Budapest, the Dual Monarchy was an agrarian society, almost as backward as Russia, with extreme contrasts of wealth and poverty. In Hungary most peasants were landless wage labourers on the great estates of the nobility. They were technically free, but their lives were no better than those of serfs. Illiteracy was the norm and infant mortality was high.
As a major concession to the German liberals and as a reward for their co-operation, the Fundamental Laws had been adopted in December 1867. They became known as the December Constitution and lasted until 1918. They guaranteed an independent judiciary, freedom of belief and education. However ministers were answerable to the Emperor rather than to the Reichsrat (the Austrian Parliament).
To many foreign observers, Hungary with its lively Parliament, looked like a proper constitutional monarchy – more so at least than Austria. In 1873, the old capital Buda and Óbuda were officially merged with the third city, Pest, thus creating the new metropolis of Budapest. But the appearance of constitutionalism was a façade. The Hungarian Parliament had the right to initiate legislation but the monarch had to give his assent to a bill before it was debated. The rights of minorities in Hungary were ignored, the freedom of the press was often under attack and judges lacked independence. In both halves of the Dual Monarchy, ministers served the Crown rather than the constitution.
Rudolf (left) and his mistress at Mayerling in 1889 and the assassination of his wife, Elisabeth, in 1898. From 1889 his heir was his nephew, Franz Ferdinand.
The most successful of his ministers was Eduard von Taafe, who governed from 1879 to 1893. He saw himself as the Emperor’s man and controlled the Reichsrat through patronage and compromises. He placated the Czechs by making Czech as well as German the administrative language of Bohemia, though this did not satisfy the radical splinter group, the Young Czechs, who in 1891 won all the Bohemian seats in the Reichsrat. In October 1893 he resigned, having failed to stem the tide of Czech nationalism. By 1900 the Reichsrat was paralyzed by the Czech-German conflict, with government functioning through the bureaucracy. Pressure from the various groups within the Empire led to the adoption of manhood suffrage in Austria in 1907. In the elections of that year Ruthenians, Poles, Czechs and Slovenes all won more seats.
Foreign policy was dictated by the attempt to preserve the Dual Monarchy. From the 1870s Austria-Hungary saw itself as under threat from the South Slav nationalism of the Croats and Serbs. Hungary in particular believed it had to crush this nationalism whether the South Slavs were in the Ottoman or Habsburg Empires and the Foreign Minister Andrássy began reluctantly to contemplate the occupation of Bosnia and Herzegovina in order to prevent future trouble.