- Compromise of 1867Following a humiliating loss in 1866 to Prussia in the so-called Seven Weeks’ War, Austrian Emperor Franz Joseph and his advisors were under intense pressure to shore up the position of the Habsburg Empire domestically. The loyalty of the Hungarians was especially problematic; discussions of revising their relationship to the monarchy had been underway even before the conflict began.The Ausgleich raised the status of the Hungarians to that of a ruling nation within the empire, a step much resented by other Habsburg subjects, particularly the Czechs in Bohemia. The Habsburg holdings were formally divided, with two capitals, Vienna and Budapest, with the Leitha River the boundary between them. The lands ruled from Vienna were officially named Cis-Leithenia; those under Hungarian control were called Trans-Leithenia. Both terms were so awkward that the entire structure was rather quickly called the Austro–Hungarian empire, and then Austria–Hungary.The Ausgleich established a few offices common to both halves of the monarchy. The Habsburgs ruled as emperors in the “Austrian” half of their lands and as kings in Hungary. There was a common foreign office and common army, both subject to extensive oversight by the sovereign. There was a joint ministry of finance as well, but its responsibilities were limited to fiscal matters connected with military and diplomatic affairs. Both parts continued to use the same currency and postal service. Every 10 years a commission with membership drawn from both halves of the monarchy met to resolve other financial questions, such as commercial and customs policies and credit obligations, which encumbered both halves of the state. Should this gathering be unable to agree, the resolution of these problems would be turned over to the monarch.The Reichsrat, or Imperial Assembly, in Vienna legislated on domestic matters for the “Austrian” side of the monarchy, where Germans, Poles, and Czechs were heavily concentrated. The Hungarian Diet did the same for its lands, where ethnic Magyars were a conspicuously small minority among the South Slavic peoples and the Romanians under their control. Both sides used local constitutions and paraconstitutional statutes to govern internal affairs, the Austrian December Laws of 1867 and in Hungary, the March Laws of 1848. At the outset, both regimes were thoroughly undemocratic, with very narrow electorates. By the outbreak of World War I, the regime in Vienna, which formally recognized the right of its peoples to cultivate their own language and nationality, had extended the right to vote to all male citizens who were 24 years of age and not excluded for other reasons. In Hungary, where the landed nobility was very influential, the franchise was carefully restricted.See also Badeni Language Ordinances.
Historical dictionary of Austria. Paula Sutter Fichtner. 2014.