Meanwhile, Austria’s finances had not really been restored. In principle, the State had resolved to renounce the habit of letting its expenditure exceed its revenue, bridging the gap by issuing uncovered paper money; but it had found no substitute for that device. Under Stadion’s regime, receipts really rose considerably; ordinary revenue, only 50·7 million gulden in 1814, had risen to a decimal point under 94 in 1817, and this was followed by further increases – another nine millions in the five years 1820–5 and 7·5 millions more by 1830.11 The sensational increase of the first four years was, indeed, due largely to the increased number of tax-payers, the Monarchy having in these years recovered the territories lost in 1809; but the load of taxation had also been increased, notably by the raising of the tax on earnings by 50% in 1817. Francis was, however, still very reluctant to increase taxation, especially direct taxation, and his subjects equally reluctant to pay it. Thus it was decided in 1817 to introduce a new land tax imposing equal taxation on all land, rustical or dominical, everywhere outside Hungary, but the prerequisite for this was a new land survey. This proved such a formidable undertaking that as late as 1843, when the Government began arguing with the Estates on what were their commitments under it, it had still been completed only in Lower and Upper Austria, Styria, Carinthia, Carniola, the Littoral and Lombardy-Venetia, and only in those Lands were the dominical Estates coming under the higher assessment.12 Meanwhile, the Government had been so extensively cheated over the valuations, especially by the big landowners, that the yield of this tax was actually lower at the end of the Vormärz than it had been in 1817.13
The biggest item on the other side of the balance-sheet was the cost of the armed forces. Francis laid down a ruling that ordinary expenditure on the army was never to exceed 40 million gulden yearly,14 and although this figure was afterwards raised to 44, and the army was never held quite rigidly to it, very real economies were effected in this field. The strength of the army was substantially reduced, chiefly by the simple device of suspending recruiting, so that the fall-out due to men leaving the colours under the new age-limits was not made good. In this way, while the nominal peace strength of the army at this period was 400,000, its actual peace strength ranged between 200–230,000 men. Further, the army reserve was abolished and the Landwehr used in its place, the first Landwehr battalion of each regiment counting as the fourth battalion of each regular regiment. Finally, both training and equipment were neglected; it was only in 1830 that percussion muskets were introduced (and they were still muzzle loaders, with a range of three hundred yards). The allowance of ammunition was only ninety rounds per annum. By these devices the military budget was brought down to an annual average of 45–50 million gulden, but only against the embittered opposition of Metternich, whose thesis that foreign policy, under which he included the preservation by Austria of European order, must take precedence of internal, was obviously incompatible with large-scale military retrenchment. And it was really difficult to economize very extensively in this field. It is to be remembered that while, looking back, we see that in 1815 in fact opened a period of nearly thirty-five years during which Austria was never once at war in the technical sense, yet when that period opened it did not look like lasting nearly so long, and during its first years it looked less like peace than an armed and precarious truce. There was revolution, or the threat of it, in Germany, Italy, Spain, Portugal, the Balkans, even France. At each crisis Metternich renewed his Cassandra-like wails of impending disaster and his persistent warnings that the price of order was eternal vigilance; the smallest relaxation might undo all that had been so painfully achieved. He was blissfully indifferent to financial objections: one could always borrow, could one not? In 1820–1 it was only technically that Austria was at peace at all; in those years her armies occupied Piedmont and Naples. The cost of the expeditions was relatively small, and Austria succeeded in getting them paid for to the tune of 28 million franks; even so, it was enough to upset the budgetary equilibrium which Stadion had painfully achieved and to keep it upset for ten years, when it was overthrown again, in the very year of its recovery, by the same cause.15
In 1828, when there seemed a possibility that war might break out with Russia over the Eastern Question, the Hofkriegsrat reported that the army was quite unfit for a campaign; neither its numbers, its equipment or its morale were adequate.
The economies on the army, besides their effects in reducing the Monarchy’s weight in international affairs, had the particularly embarrassing consequence (on which, as we shall see, the attempt to impose absolutism throughout the Monarchy ultimately foundered) that when troops and subsidies were required for some foreign enterprise, there was no course but to apply for them to Hungary, thus presenting the Hungarian Diet with its opportunity to assert its rights.
The army was not, of course, the only big source of expenditure; the reincorporation of the recovered provinces entailed expenditure as well as bringing in revenues. Thus all economies and windfalls notwithstanding, there was still a regular and formidable annual deficit, ranging from 50 million gulden downward. The Government covered a fraction of this by auctioning (usually for very inadequate sums) State properties, including the last of the Church properties which Joseph II had confiscated. For the rest, it perforce resorted to internal loans, lottery or ordinary subscription, or borrowed abroad. Both types of loan were chiefly raised for it by Viennese bankers, or the Viennese representatives of international banking-houses, a small ring, composed for the most part of ‘privileged’ Jews, who now ousted the older firms (mostly Swiss) which had served Francis during his earlier years. Easily the most important of these new houses was that of Rothschild, whose representative, Salamon, founded a branch of the family house in Vienna in 1819. Within a very few years Salamon, who was given a barony in 1822, made his family not only far the richest but, after that of Habsburg, probably the most really powerful in the Monarchy. Hardly a decision on high policy could be taken without Salamon’s approval, and an extraordinary number of them were taken on his direct advice. Metternich’s relationship to him is one of the most curious in history. Rothschild’s relationship to Metternich’s publicist, Gentz, was, indeed, simple enough: he bribed him heavily to look after his interests.
The benefits of the connections (many of them running through the National Bank) between the Austrian Government and these circles were not altogether one-sided. The Rothschilds, in particular, rendered Austria extraordinary service in 1823, when they got her chief foreign debt-that to Britain – settled by persuading the British Government to renounce all but £2,500,000 of the £23,500,000 at which the debt then stood, and undertaking the transference of this sum, for which they then became the creditors of the Austrian Government.16 And the bankers nearly always arranged that the Government should get a loan when it wanted one. But it paid through the nose for the accommodation. Up to 1820 it was seldom able to float a loan at over 70,17 often only at 60–5, so that it actually paid 8–9% on what it borrowed.18 Later the terms became somewhat easier, but during the whole of Francis’s reign no loan was ever floated as high as 90.19 Thus, as time went on, the State debt became an enormous millstone around Austria’s neck. Between 1816 and 1823 alone it rose from 739 to 905 million gulden, the interest on it from 8·9 to 23·5 and the gross annual expenditure from 12 to 36.
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Meanwhile, the outcome of the Congress of Vienna had, not unnaturally, confirmed Francis in the conviction that he had been right all along, after all. In the preceding twenty-five years he had listened time and again to advisers who had wheedled him into trying this or that innovation; every time he had done so, he had lost a war, and usually a province. Since 1810 he had gone his own way, and now had emerged triumphant, all the lost ground recovered and twenty-three years weathered, twenty-one of them since the last serious hint of internal trouble.
In any case, he was genuinely unable to see what more remained for him to do in the political field. In his view, which Metternich reflected
faithfully, all that the ‘subjects’ needed was material well-being and good laws. The well-being would come in time – in any case, he was quite blind to the problem of poverty except when it manifested itself beyond concealment in some natural catastrophe, a famine or a flood, when he was ready enough that relief should be organized; the laws were there, for following the new Penal Code, the new ‘General Civil Code’ – another very excellent piece of work – had been completed and issued by Patent in 1811.20 It was now extended to the new or re-acquired Lands, and therewith Francis really felt that nothing more remained for him to do.
Finally, as Sedlnitzky of the police once said (probably with reference to himself and Metternich), ‘although His Majesty had always had the system, it was only now that he had been fortunate enough to find the organs which reflected it without distortion.21
Among the ‘distortions’ which now vanished was a large part of the background influence which the great feudal aristocracy had, thanks largely to Colloredo’s influence, succeeded in salvaging when Francis first ascended the throne. It is hardly possible to define exactly the stages by which the fall of the aristocracy took place. According to Sealsfield22 it was after 1811 that they ‘fell into disgrace’. Beidtel23 puts the decisive change after 1815. Then, he writes, the aristocracy felt that many considerations which the Court had been forced to pay to the revolutionary situation no longer applied, and they would be able to recover their old near-monopoly of the leading positions in the Church, the administration and the army. Unfortunately for themselves, they voiced their views too openly, especially over certain Episcopal appointments, and the Emperor, offended, took the opposite line. It is certain in any case that during these years of its hey-day Francis’s system underwent a perceptible reversion to Josephinism, in respect both of its composition and its spirit.
There was naturally no place in it for any kind of representative institutions. When Austria entered into possession of her new or newly-acquired territories, she found herself, indeed, under an obligation to introduce ‘Constitutions’ in some of them, in virtue of certain international instruments signed by her at Vienna.24 Estates were accordingly set up in Tirol-Vorarlberg, Carniola and (in 1826, after its constitution as a separate Land) Salzburg. None of these ‘Constitutions’, however, provided for any genuine self-government. Even that of the Tirol, the least restricted of them, still gave its Estates less power than they had enjoyed under Leopold.25 A law establishing Estates for Gorizia-Gradisca, although drafted, was never put into force, and no representative institutions were ever provided for Istria or (while Francis ruled) Dalmatia.
The provinces belonging to the old Hereditary and Bohemian Lands, with Istria and Dalmatia, were then simply put back under the old Vereinigte Hofkanzlei, or, as it was called after 1817, the Ministerium des Innern26 (the head of which was now entitled ‘Oberster Kanzler und Minister des Innern’, and were governed as autocratically as ever,27 and on highly centralized lines; even the spheres within which the Gubernia could act without reference to Vienna were extremely limited. The only changes in the administrative or judicial systems on the lower levels were the small reforms of the Patrimonial Courts mentioned above.28
Hungary and Transylvania retained their own Chancelleries, or Chancellery, which remained in name directly under the Crown alone. It was, however, as truly an instrument of the Monarch’s will as any of its sister bodies. The Diets were left unconvoked.29
The Government had decided in 1817 that it would be good policy to placate the Poles, lest they should gravitate towards Russian Poland. The severity of the regime in Galicia was consequently somewhat relaxed. The Province was given the style of a Kingdom, with a Viceroy, and its own Court Chancellery in Vienna. The Estates were remodelled, the Bench of Magnates being reinforced through the creation of new titles, and were allowed to meet again after thirty-five years. The real authority, however, remained entirely with the Gubernium and its officials, who continued to be drawn, with few exceptions, from the Hereditary and Bohemian Lands.
Only Lombardy-Venetia was treated somewhat differently. Francis had, indeed, rejected a request brought to him in 1814 by a deputation from Milan that Lombardy should constitute an independent Kingdom under the Austrian Crown, with its own institutions. His reply had been that Lombardy was his by right of conquest, and that he would inform the Milanese of the dispositions which he proposed to make concerning them. On 23 May Field-Marshal Bellegarde had then formally taken possession of Lombardy on the Emperor’s behalf.
Nevertheless it was felt advisable to conciliate the Italians, and unwise even to attempt the impossible task of Germanizing them. Accordingly, Lombardy-Venetia was constituted a Kingdom, and after Francis had had himself crowned, an Archduke (this time an important one)30 was sent down to represent him.
It was provided with a ‘Congregations General’, composed of representatives of the noble and non-noble landowners, and the larger towns, whose duty it was to see the local execution of Government legislation and its right, to bring the wishes and needs of the population to the attention of the authorities. Below this level, the Kingdom was divided into two Gubernia (the frontier being moved westward to the Mincio in order roughly to equalize the populations), each of which was provided with a ‘Provincial Congregation’ on the same representational pattern as the Congregation General. The Viceroy was to reside half the year in each Gubernium. Below this again, Lombardy was divided into nine, and Venetia into eight, Provinces, corresponding to the Austrian Kreise. There was an excellent system of local autonomy. At first each Gubernium was also given its own military command, but the command was afterwards centralized in Verona, with sub-commands in the two capitals, Milan and Venice.
The Kingdom had its own Court Chancellery in Vienna, and the language of the administration, education and the Courts was Italian. (German was taught as a subject in the higher establishments.) There was an abundance of educational establishments of all grades, from the famous Universities of Padua and Pavia downward, and a relatively modern judical system, all of it State,31 with a separate High Court in Verona, officially regarded as a branch of the Supreme Court in Vienna. At the beginning all existing Italian civil servants, except those very closely associated with the previous regimes or found to belong to secret societies, were allowed to keep their posts; only a few civil servants and judges, and those picked ones,32 were sent down from Vienna to initiate the Italians into the Austrian system and to exercise a measure of control over them. Another important concession to the Kingdom was that the debased Austrian paper currency was not made legal tender in it, the silver currency continuing to circulate.33
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The top-level machinery of Government underwent various changes of form, none of which modified at all substantially its essential nature. The regular conferences, based on the Staatsrat, had ceased with the fall from favour of the Archduke Rainer, and no attempt was made to replace them until 1814, when another reorganization was carried through. The Staatsrat was again remodelled as a general supervisory body, to control the work of all Government departments outside Hungary except that of Foreign Affairs. It was divided into four sections, dealing respectively with legal affairs, ‘politica’ (internal administration; the head of this section was responsible not only for the Ministry of the Interior, but also for the Italian and Galician Court Chancelleries), finance, and defence. The heads of sections were to meet regularly in conference, under the presidency of Count Wallis.
‘Beside and above’ the Staatsrat – the relationship between the two bodies was expressed only in this vague phrase – there was to be a Konferenzrat, for the discussion of general policy on the highest level. All ‘Real Ministers’, i.e. heads, past and present, of departments with Ministerial rank, were perpetual members’ of this body, with the title of Staats-und Konferenzminister. Other members were nominated by Francis, either for life, or for shorter periods. The first President was Count Károly Zichy;34 when he died in 1826, Prince (as he had been
created in 1813) Metternich succeeded to the Presidency.
Metternich, who in 1821 had been made formal head of the Haus-Hof-und Staatskanzlei,35 had also, in 1824, been given the title (vacant since the death of Kaunitz) of State Chancellor, with the emoluments of the office; but this, as he soon discovered, had given him no authority to control the work of other departments, or even to know what they were doing. And as the Konferenzrat met, in the event, no more often than its predecessors, there was still no one beside Francis himself even in a position to survey the whole field of the Monarchy’s affairs, much less take a decision in the light of it. Nor was there any improvement in the cumbersome character of the machine, and its inability to distinguish between the important and the trivial.36
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Under this system, the maintenance of stability was developed into a fine art as never before. In 1810 the censorship had, in theory, been slightly relaxed, owing to the representations of the then Chief of Police, Baron von Hagen, who was a relatively liberal-minded man, and had warned Francis that it was dangerous to overstrain the bow; and in October of that year Francis had issued new instructions for the censors, to the effect that serious works of learning containing new discoveries or points of view, and written for savants and specialists, were not to be forbidden without real cause; even serious and constructive criticism of the administration was to be allowed, so long as it contained nothing which was contrary to religion or morality, or subversive – although even so ‘a careful hand should safeguard the hearts and heads of the immature from the deleterious products of an abominable fantasy, the poisonous breath of self-seeking seducers and the dangerous chimeras of perverse brains’.37
The Habsburg Empire (1790-1918) Page 33