Austro-Hungarian Compromise of 1867

Civil ensign of Austria-Hungary

The division between lands to be administered from Vienna (here deep pink) and lands to be administered from Budapest (green) under the 1867 Dual monarchy "Ausgleich" agreement. From 1878 Bosnia-Herzegovina (yellow) were jointly administered.

Coronation of Francis Joseph I and Elisabeth Amalie at Matthias Church, Budapest, 8 June 1867.

The Austro-Hungarian Compromise of 1867 (German: Ausgleich, Hungarian: Kiegyezés) established the dual monarchy of Austria-Hungary. The Compromise re-established the sovereignty of the Kingdom of Hungary, separate from and no longer subject to the Austrian Empire. Under the Compromise, the lands of the House of Habsburg were reorganized as a real union between the Austrian Empire and the Kingdom of Hungary. The Cisleithanian (Austrian) and Transleithanian (Hungarian) regions of the state were governed by separate parliaments and prime ministers. Unity was maintained through rule of a single head of state, the Emperor of Austria and King of Hungary, and common monarchy-wide ministries of foreign affairs, defence and finance under his direct authority. The armed forces were combined with the Emperor-King as commander-in-chief.

The names conventionally used for the two realms were derived from the river Leitha, or Lajta, a tributary of the Danube and the traditional border between Austrian and Magyar lands. The Leitha however did not form the entire border nor was its whole course part of the border: the Cis- and Trans- usage was by force of custom rather than geographical accuracy.

History

In the Middle Ages Austria was a quasi-independent state within the Holy Roman Empire, ruled by the House of Habsburg, while the Kingdom of Hungary was a sovereign state outside the empire. In 1526 at the Battle of Mohács, Hungary was defeated and partially conquered by the Ottoman Empire. The crown of Hungary was inherited by the Habsburgs, with part of the kingdom preserved from the Ottomans, who were subsequently driven out of Hungary in 1699. From 1526 to 1806, Austria and Hungary were a personal union under the Habsburgs, but remained nominally separate.

In 1804–6, the Holy Roman Empire was abolished, and the Austrian Empire was created. The establishment of the Austrian Empire did not affect the status of Kingdom of Hungary (see below). After the Hungarian Revolution of 1848 - which was crushed by Russian and Austrian forces - Kingdom of Hungary lost its former status. Nationalist sentiment among the Magyars and other peoples of the region threatened the stability of the state and the power of the Austrian elite.

The status of Kingdom of Hungary before the revolution

The Kingdom of Hungary was only formally part of Empire of Austria. It was regnum independens, a separate Monarchy as Article X of 1790 stipulated. According to the Constitutional law and public law, the Empire of Austria has never lawfully included the Kingdom of Hungary. After the cessation of the Holy Roman Empire (Kingdom of Hungary was not part of it) the new title of the Habsburg rulers (Emperor of Austria) did not in any sense affect the laws and the constitution of Hungary according to the Hungarian Diet and the proclamation of Francis I in a rescript, thus the country was part of the other Lands of the empire largely through the common monarch.

The administration and government of the Kingdom of Hungary were not united with the common administrational and governmental structure of the Austrian Empire. The central governmental structures remained well separated from the imperial government, and they were linked largerly by the person of the common monarch. The country was governed by the Council of Liutenancy of Hungary (the Gubernium) - located in Pressburg and later in Pest - and by the Hungarian Royal Court Chancellery in Vienna.

The Empire of Austria and Kingdom of Hungary have always maintained separate parliaments. (See: Imperial Council (Austria) and Diet of Hungary.) Legally, except for the Pragmatic Sanction of 1713, common laws have never existed in the Empire of Austria and the Kingdom of Hungary.

Since the beginnings of the personal union (from 1527), the government of Kingdom of Hungary could preserve its separated and independent budget. After the revolution of 1848-1849, the Hungarian budget was amalgamated with the Austrian, and it was only after the Compromise of 1867 that Hungary received a separate budget. From 1527 (the creation of the monarchic personal union) to 1851, the Kingdom of Hungary maintained its own customs borders which separated her from the other parts of the Habsburg-ruled territories. Since 1867, the Austrian and Hungarian customs union agreement had to be renegotiated and stipulated every ten years. The agreements were renewed and signed by Vienna and Budapest at the end of every decade because both countries hoped to derive mutual economic benefit by the customs union. The Austrian Empire and Kingdom of Hungary contracted their foreign commercial treaties independently of each other.

After the revolution (1848–1867)

In the failed Hungarian Revolution of 1848, the Magyars came close to regaining independence, and were defeated by the Austrian Empire only with the aid of the Russian Empire. After 1848, the empire instituted several constitutional reforms, trying to resolve the problem, but without success.

The Hungarian government and Hungarian parliament were suspended after the Hungarian revolution of 1848.

In 1866, Austria was completely defeated in the Austro-Prussian War and its position as the leading state of Germany ended forever, as the remaining German minor states were soon absorbed into the German Empire created by Prussia. Austria also lost almost all of her remaining claims and influence in Italy, which had been her chief foreign policy interest.

The state needed to redefine itself to maintain unity in the face of nationalism.

Adoption

As a consequence of the Franco-Austrian War, and the Austro-Prussian War the Habsburg Empire was on the verge of collapse in 1866.

"In 1848 the state's financial needs accelerated and it began to issue its own paper money. The result of these issues was so inflationary that the national bank could no longer maintain the convertibility of the gulden into silver. In foreign exchange markets the Austrian gulden became a floating currency whose value was determined by the forces of supply and demand... The reestablishment of the gulden's convertibility into silver and the restoration of monetary stability became goals of successive finance ministers in the 1850s and 1860s. These efforts, however, were thwarted by the Empire's inability to avoid military conflict and the accompanying pressures for monetary expansion that this generated." in: David F. Good: The Economic Rise of the Habsburg Empire, 1750-1914. 1984. p.82.

The Habsburgs were forced to reconcile with Hungary, to save their empire and dynasty. The Habsburgs and part of the Hungarian political elite arranged the Austro-Hungarian Compromise of 1867, despite the fact that the overwhelming majority of the populace wanted full independence.

Hungarian statesman Ferenc Deák (Francis Deak) is considered the intellectual force behind the Compromise. Deák initially wanted independence for Hungary and supported the 1848 Revolution, but he broke with the hardline nationalists and advocated a modified union under the Habsburgs. Deák took the line that while Hungary had the right to full internal independence, questions of defense and foreign affairs were "common" to both Austria and Hungary under the Pragmatic Sanction. He also felt that Hungary benefited through continued unity with wealthier, more industrialized Austria, and that the Compromise would end the pressures on Austria of continually choosing between the Magyar and Slav populations of the Kingdom of Hungary. Imperial Chancellor Beust quickly negotiated the Compromise with the Hungarian leaders. Beust was particularly eager to renew the conflict with Prussia, and thought a quick settlement with Hungary would make that possible. Franz Joseph and Deák signed the Compromise, and it was ratified by the restored Diet of Hungary on 29 May 1867.

The Compromise was arranged and legitimated by a very small part of the Hungarian society (suffrage was very limited: less than 8 percent of the population had voting rights), and was seen by a very large part of the population as betrayal of the Hungarian cause and the heritage of the 1848-49 War of Independence. This caused deep and lasting cracks in Hungarian society.

"However, to get the Compromise accepted within the society posed serious difficulties. Many counties (for example Heves, Pest, Szatmár) rejected the Compromise and stood up for Kossuth, the opposition organized a network of Democratic circles, on the Great Hungarian Plain anti-government and anti-Compromise demonstrations of several thousand men took place, etc. The government, suspending its liberal principles, decided to take firm counter moves: imprisoned László Böszörményi who published the Kossuth letters, banned the Democratic circles, sent a royal commissioner to the most resistant Heves County. The stabilization of the system and the admittance of new political institutions, however, still dragged on for years."

"Viszont a kiegyezés elfogadtatása a társadalommal, komoly nehézségekbe ütközött. Több megye (például Heves, Pest, Szatmár) elutasította a kiegyezést és kiállt Kossuth mellett, az ellenzék megszervezte a demokrata körök hálózatát, az Alföldön többezres kormány- és kiegyezés-ellenes népgyűlésekre került sor stb. A kormány, felfüggesztve liberális elveit, határozott ellenlépésekre szánta el magát: bebörtönözte a Kossuth levelit közlő Böszörményi Lászlót, betiltotta a demokrata köröket, a leginkább ellenálló Heves megyébe pedig királyi biztost küldött. A rendszer stabilizálása és az új politikai intézmények elfogadása azonban még így is évekig elhúzódott." in: Cieger András: Kormány a mérlegen - a múlt században.

Beust's desired revenge against Prussia did not materialize. When in 1870, Beust wanted Austria-Hungary to support France against Prussia, Hungarian Prime Minister Gyula Andrássy was "vigorously opposed", effectively vetoing Austrian intervention.

Terms

Under the Compromise, Austria and Hungary had separate parliaments that met in Vienna and Buda (later Budapest), respectively, that passed and maintained separate laws. Each region had its own government, headed by its own prime minister. The "common monarchy" consisted of the emperor-king, and the common ministers of foreign affairs, defense, and finance in Vienna. The terms of the Compromise were renegotiated every ten years.

Despite Austria and Hungary sharing a common currency, they were fiscally sovereign and independent entities.

Continuing pressures

The resulting system was maintained until the dissolution of the state following World War I. The favoritism shown to the Magyars, the second largest ethnic group in the state after the Germans, caused discontent on the part of other ethnic groups like the Czechs and Romanians. Although a "Nationalities Law" was enacted to preserve the rights of ethnic minorities, the two parliaments took very different approaches to this issue.

The basic problem in the later years was that the Compromise with Hungary only encouraged the appetites of non-Hungarian minorities and regions in Hungary that were historically within the boundaries of the previous Hungarian Empire. The majority of Hungarians felt they had accepted the Compromise only under coercion. The Austrian Archduke, separately crowned King of Hungary, had to swear in his coronation oath not to revise or diminish the historic imperial (Hungarian) domains to the Hungarian nobility, magnates, and upper classes. These Hungarian groups never acquiesced to granting "their" minorities the recognition and local autonomy which the Austrians had given to the Magyars themselves in the Compromise.

In the Kingdom of Hungary, several ethnic minorities faced increased pressures of Magyarization. Further, the renegotiations that occurred every ten years often led to constitutional crises. Ultimately, although the Compromise hoped to fix the problems faced by a multi-national state while maintaining the benefits of a large state, the new system still faced the same internal pressures the old had. To what extent the Dual Monarchy stabilized the country in the face of national awakenings and to what extent it alleviated, or aggravated, the situation are debated even today, particularly by ethnic groups in the region still constructing nation-states.

Archduke Francis Ferdinand had the following views about the Compromise of 1867.

Francis Ferdinand was a prince of absolutist inclinations, but he had certain intellectual gifts and undoubted moral earnestness. One of his projects--though because of his impatient, suspicious, almost hysterical temperament, his commitment to it, and the methods by which he proposed to bring it about, often changed--was to consolidate the structure of the state and the authority and popularity of the Crown, on which he saw clearly that the fate of the dynasty depended, by abolishing, if not the dominance of the German Austrians, which he wished to maintain for military reasons, though he wanted to diminish it in the civil administration, certainly the far more burdensome sway of the Magyars over the Slav and Romanian nationalities which in 1848-49 had saved the dynasty in armed combat with the Hungarian revolution. Baron Margutti, Francis Joseph's aide-de-camp, was told by Francis Ferdinand in 1895 and--with a remarkable consistency in view of the changes that took place in the intervening years--again in 1913, that the introduction of the dual system in 1867 had been disastrous and that, when he ascended the throne, he intended to re-establish strong central government: this objective, he believed, could be attained only by the simultaneous granting of far-reaching administrative autonomy to all the nationalities of the monarchy. In a letter of February 1, 1913, to Berchtold, the Foreign Minister, in which he gave his reasons for not wanting war with Serbia, the Archduke said that "irredentism in our country ... will cease immediately if our Slavs are given a comfortable, fair and good life" instead of being trampled on (as they were being trampled on by the Hungarians). It must have been this which caused Berchtold, in a character sketch of Francis Ferdinand written ten years after his death, to say that, if he had succeeded to the throne, he would have tried to replace the dual system by a supranational federation.

The end

With the political agenda dominated by war and imminent defeat, in the middle of October 1918 the Hungarian government, with the agreement of King Charles IV of Hungary (who was also the Austrian Emperor Charles I), gave notice of termination. The 1867 compromise was formally terminated on 31 October 1918. Shared institutions such as the Council of Ministers remained formally in force until 2 November 1918, but by this time for all practical purposes power had devolved from Budapest to the various emerging nationally based regions that would form the basis for the redrawing of the map of middle Europe at the Paris Peace Conference, 1919 which formally began its own work early in 1919..

References

• Chronology of the Compromise
• The Dual Monarchy in Hungary
• Nationalism in Hungary

Further reading

• Cornwall, Mark (2002), Last Years Of Austria-Hungary: A Multi-National Experiment in Early Twentieth-Century Europe (2nd ed.), University of Exeter Press.
• Seton-Watson, R. W. (1939), "The Austro-Hungarian Ausgleich of 1867", The Slavonic and East European Review, no. 19.53/54, pp. 123–40, JSTOR 4203588.
• Seton-Watson, R. W. (1925), "Transylvania since 1867", The Slavonic Review, no. 4.10, pp. 101–23, JSTOR 4201928.
• Taylor, A. J. P. (1952), The Habsburg Monarchy, 1815 – 1918: A history of the Austrian Empire and Austria-Hungary., New York: Macmillan.
• Tihany, Leslie C (1969), "The Austro-Hungarian Compromise, 1867–1918: A Half Century of Diagnosis; Fifty Years of Post-Mortem", Central European History, no. 2.2, pp. 114–38, JSTOR 4545523.
• Sowards, Steven W (23 April 2004), Nationalism in Hungary, 1848–1867. Twenty Five Lectures on Modern Balkan History, Michigan State University, retrieved 19 March 2009.