Francis Joseph, who did not lack courage, made an extended tour of the country (including Transylvania, the Voivodina and Croatia) in 1852. An amnesty was enacted on this occasion and honours and decorations distributed lavishly. His marriage in 1854 was celebrated, here as elsewhere, with another amnesty, and martial law was, as we have seen, lifted from all the Hungarian Lands in 1854. These gestures possibly chipped the surface of the national hostility; but they did little or nothing to melt it.
The greatest disappointment of all to the regime was that the opposition to it in Hungary was not confined to the country’s old traditional ruling class. Bach had always counted with their hostility, but he had reckoned that he would be able to neutralize it with the support which he expected to receive from the peasants, the ‘Nationalities’, and Croatia. And even this was not forthcoming. The peasants appreciated their liberation, but persisted in attributing it, not to Vienna, but to Kossuth, and there is little evidence that they preferred the relatively efficient but alien Bach Hussars to their own traditional masters, whose oppression of them was of a type which they understood and had to some extent learnt how to counter (the Germanic peoples would be less universally unpopular if they could rid themselves of their cherished illusion that anyone except themselves wants or likes efficiency). Having now no more fears that the landlords would try to get the old system restored, they made common cause with them against the representatives of the new authority.
The Slovak nationalists found that they had got, after all, very little more out of Vienna than they had out of Pest, and their Lutherans, an influential body among them, shared the religious grievances of their Magyar co-religionists. The Serbs fretted against the ill-faith which had given them, instead of their own self-governing province, an absolutely ruled Department full of Germans and Roumanians. They were soon wondering whether they would not have done better to make terms with Hungary, after all. In Transylvania, both the Saxons and the Roumanians were solid in opposing reunion with Hungary, but both were bitterly disappointed with the new absolutism. The Saxons, as Lutherans, had their special grievance against its clericalism. The Croats brooded over Dalmatia, and found the yoke of the imported foreign officials as heavy as the Hungarians did; all the books quote the remark made by a Croat to a Hungarian friend, ‘we have got as reward what you have been given as punishment’. When Francis Joseph visited Croatia after his Hungarian tour, his reception was so bad that the tour was cut short, on grounds of security, after only six days.
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Whether the ideologies of absolutism and depoliticization of national feeling could under any circumstances have finally overcome the demands for self-government and national self-expression which they were challenging, they could most certainly not hope to do so without the continuance of a tranquil and favourable international climate. That climate was still relatively benign in 1852, although even then not cloudless, for in that year Austria ruffled the Czar by intervening in defence of Montenegro, whose Prince had provoked the Porte by certain completely wanton acts of aggression. The Czar decided to swallow this, and to take it as a filial act. Then in the spring of 1853 he began to hint to Francis Joseph, in private correspondence, his intention of himself attacking the Porte; thereby placing Austria – which had itself set the bad example – in a position of extreme difficulty. For several months Francis Joseph did his best to dissuade the Czar from his enterprise; in spite of this, Nicholas, in July, sent his troops into Moldavia and Wallachia. Francis Joseph tried to mediate between him and the Porte, but again without success; on 4 October Turkey declared war on Russia. Britain and France now came to the support of the Porte; in March 1854 they declared war on Russia. Francis Joseph did not join them in this final step, but he mobilized considerable forces (three Army Corps in South Hungary in the autumn of 1853, and in April 1854 four more Corps in Galicia, besides a general call-up in the interior), associated himself with their programme, which amounted to the exclusion of Russia from the Principalities and the Danube, and from any influence over the internal affairs of the Porte, and after Russia had evacuated the Principalities, sent an Austrian occupation force into them. By this time Buol had begun to urge that Austria herself should enter the war and take the Principalities for herself as her reward, and in December he actually concluded an alliance between Austria and the Western Powers (this without informing Prussia, as should have been done); but to the anger especially of Louis Napoleon, who felt himself betrayed, Francis Joseph still refused to take the final step of war. Thus 1855 saw Austria still non-belligerent with even her military preparations relaxed, for she had again demobilized most of her forces, while Turkey, France and Britain, now joined by Piedmont, fought Russia in the Crimea. Then, in March 1856, a Conference in Paris, attended by the belligerent Powers and Austria, concluded a peace which duly excluded Russia from the Danube, but instead of assigning the Principalities to Austria (which Napoleon would have let her have, but only if she renounced Lombardy-Venetia in exchange), left them under Turkish sovereignty with increased autonomy.
Most historians have passed very severe judgments on the policy followed by Francis Joseph and Buol during this crisis. According to some, Austria ought to have done what her Generals wanted: to have associated herself with Russia from the first, taken her share of the booty in the Western Balkans, and preserved in being the Holy Alliance between despots which had saved her in 1849. According to others, she should have cast in her lot wholeheartedly with the Western Powers, when she would have emerged with unimpaired prestige, with allies, and probably also in possession of the Principalities. As it was, she fell between two stools.
The accusations of clumsiness and vacillation are not ill-founded, but it is at least arguable that the most far-sighted determination would have availed Austria little. The breach which ensued between her and Russia was bound to come if the Czar set himself to realize ambitions which he could not but know (he had had a foretaste of it in the little Montenegrin crisis) that Austria regarded as constituting a threat to her vital interests. In his long correspondence with the Czar, Francis Joseph made his position abundantly clear, and if Nicholas disregarded the warnings, it was with his eyes open. The offence to Prussia could have been avoided, but this would not have destroyed Prussia’s fundamental determination sooner or later to oust Austria from the leadership of Germany. Louis Napoleon had been offended, and Piedmont had managed to seize the opportunity to steal a march on Austria; but it is hard to think that an alliance between France and Austria would have postponed for long that later understanding between France and Piedmont which was so much rather the natural expression of Napoleon’s whole political outlook; still harder to believe that diplomacy could long have dammed the elemental tide of Italian nationalism. Equally elemental, if at the time less turbulent, was the Roumanian national movement. If Buol had really succeeded in annexing the Principalities, the developments of the movement would have taken another form, but it is doubtful indeed whether this would have been a more tractable one. This consideration applies equally strongly to the course advocated by the Generals.
In short, what was undermining Austria’s international position was less faults of her own policy than the advance of nationalism in Central Europe. But the fact remained that the end of the war found that position gravely weakened. Bismarck had been given his chance to begin organizing anew resistance to Austrian hegemony in Germany. Piedmont had gained the confidence and prestige which marked her out again as the future nucleus of a united Italy. An alliance between this rising Power and France could be no more than a matter of time. It could also be no more than a question of a few years before the Danubian Principalities had achieved enough national consolidation to exert a strong centrifugal pull on the Roumanian subjects of the Monarchy.
And the new Czar was bitterly disillusioned with and hostile to his father’s ex-protégé. Never again could Francis Joseph count on such help as Nicholas had given him in Hungary in 1849 and against Prussia in 1850.
The crisis had also dealt another blow to Austria’s hopes of early financial recovery. That she had kept out of war at all in 1854, and had remained mobilized for only a few months, had been due mainly to Baumgartner’s insistence that she could not afford a campaign. Even so, the costs of arming and mobilization and of the occupation of the Danubian Principalities, had sent her military expenditure rocketing up, and the premium on silver, which had sunk to 108 in 1853, rose again sharply.
The Government attached extreme importance to wiping out the premium, but it was clear that this would not vanish until the National Bank had recovered at least the bulk of what the Government owed it. A few small international loans had been raised, on onerous terms, but now the foreign financial houses refused to help any further at all, in view of the international situation and still more, out of resentment against the recent enactment forbidding Jews to buy real property in Austria. This measure had, in particular, brought Baumgartner into bad odour with the Rothschilds, who had helped him in 1852, but now refused to do so any longer.110 In June 1854, accordingly, a great internal loan of five hundred million gulden, the largest in Austrian history, was floated for the express purpose of paying off the State’s debt to the Bank. Much propaganda was made for the loan, and more than propaganda,111 so that the full five hundred million were subscribed; but the proceeds were swallowed up almost entirely by the army, and the State was still left owing the Bank (from which it had meanwhile taken further advances), as much as before. Military expenditure for the year totalled 198 m.g., the service of the debt was now 85 m.g., the deficit 157 m.g. and the premium on silver 140.
Now Baumgartner resigned in despair, and in March 1855 Bruck succeeded him as Minister of Finance. Bruck attacked the situation with all his usual energy. There were still bills for the army to be paid, as the aftermath of 1854, so that military expenditure for 1855 still totalled 257 m.g., but now it was cut down drastically. Taxation was raised. In October, State property valued at 156 m.g., the amount of the State’s direct debt to the Bank under the 1854 agreement, was handed over to that institution, which was authorized either to hold and manage the estates, or to sell them.
The biggest retreat of all was over the State railways, the construction and management of which had been a heavy passive item in the Budget. As early as 1854 the Government had begun back-pedalling on railway construction; a Patent of that year, setting out which lines were to be built in the near future, had allowed for most of them to be constructed by private concessionaires, who received in return sundry concessions, including a State guarantee of five per cent on their invested capital at two per cent amortization. The Pereire group in Paris, acting in conjunction with Sina, had begun negotiating for the construction of a number of lines in the north and southeast of the Monarchy, on conditions which included the cession to the group, on very favourable terms, of several big iron and steel works. Next, the State began selling off its own lines outright. The Pereires hoped to acquire these, too, through the Credit Mobilier, and actually bought some of them on 1 January 1855, but meanwhile Bruck had accomplished what was not the least important of his achievements: he had re-established good relations with the Rothschilds. Rothschild had succeeded in organizing the Creditanstalt, and in May 1856 that institution bought the Lombardy-Venetian railways for a hundred million francs. Other lines followed – first, most of the State lines in the north of the Monarchy, then, in 1858, the still unfinished Südbahn, the purchaser of this (another foreign company behind which, again, the Rothschilds stood), undertaking the obligation, on which the Government insisted in view of the possibility of war with Piedmont, of completing the line as far as Trieste.
The sales although very disadvantageous to the State,112 yet brought it in some ready money, and one way and another, the deficits, which had still totalled 158 m.g. in 1855, were really brought down: to 81 m.g. in 1856, 53 in 1857 and 52 in 1858. The premium on silver sank to a figure so small that on 28 September 1858 the National Bank resumed convertibility, for the first time for over ten years.
By this time, however, the State had come near to exhausting its realizable assets, and had pledged pretty nearly all its credit; and what was hardly less important, private money in liquid form was also running short. 1855 and 1856 had still been golden years for the speculators. The Creditanstalt, with its glittering names, had attracted a great crowd of eager investors, who had sent its shares soaring in spectacular fashion, and many fortunes had been made. But in 1857 the great Stock Exchange crisis, travelling eastward from New York via London and Paris, reached Vienna. Countless small speculators found themselves ruined, and the Rothschilds themselves had to draw in their horns. Moreover, they were now such heavy creditors of the State, directly as holders of large quantities of State loans, indirectly as owners of railways, that their interest in the solvency of the State was vital. The day was over at last when they could keep old payments going by sponsoring new loans.
Thus, as in the Vormärz, a powerful movement arose which demanded, for economic-financial reasons, constitutional control over Government expenditure. Its chief representatives were, indeed, no longer quite the same as the German bourgeois who had called for the resignation of Metternich. It was no accident that the leaders of the new Opposition were particularly hostile to the Concordat and all its works, nor that the first concessions made by the Crown in 1859 should have included promises to allow autonomy and freedom of worship to the non-Catholic religions and ‘to regulate the position of the Israelites along modern lines’. But it was an opposition which found itself in natural alliance with the other forces now fretting against the absolutist system.
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The strongholds of these forces were, as before, Hungary and Lombardy-Venetia, and in both of these danger-spots the resistance grew with the change in the international situation. In Hungary, it is true, the extremists had lost some further ground. Kossuth himself had been shocked by the fiasco of the 1851 rising, and had advised his followers to draw in their horns until the international situation changed for the better. His hopes had been raised again by the outbreak of the Crimean War, and he had set about organizing a legion, but had had to abandon the plan when Austria decided on neutrality. Thereafter he had slipped down into the ranks of the émigré revolutionaries, consorting intimately with Mazzini, and for the rest, engaging with Polish émigrés and sometimes with official personalities in Serbia and the Danubian Provinces in plans for the reorganization of East Central Europe as a federation of independent States which have a considerable historic interest but were, perhaps, fortunate in never being put to the test of practical application.
By this time, too, the emigration was becoming weakened by quarrels among its leaders, many of whom thought Kossuth inclined to take too much on himself. Several important figures among them, including Count Gyula Andrássy, accepted the amnesty, signed declarations of loyalty to the Crown, and returned to Hungary.
On the other hand, Deák had in 1854 sold his estate in Zala and moved to Pest, where he soon became the centre of a circle which, at first consisting of a few friends, widened until it came to comprise most of Hungary’s political thinkers and potential leaders outside the Old Conservatives on the one hand and the irreconcilables on the other. Therewith the moderate opposition, then generally described as the ‘1848-ers’,113 acquired a leader, a programme, and, not the least important things, discipline and courage. Deák’s programme was perfectly simple and perfectly logical. For him, the legal situation for Hungary was that created by the April Laws. He did not regard them as immutable; they could be revised, and in some respects obviously required revision. This, however, could only be done in the legal way, by agreement between Hungary’s lawfully crowned King and her lawfully elected Parliament. Pending this, any other system was unlawful, and need not be obeyed. His prescription, in a phrase, was passive resistance until the other side should accept his postulates.
Deák admitted unreservedly the validity of the Pragmat
ic Sanction, so that his attitude, unlike that of Kossuth, offered the possibility of a settlement between Hungary and the Crown which would give the Monarch Hungary’s loyalty and her co-operation in maintaining the further existence of the Gesammtmonarchie. But it also required nothing less than the complete retraction by the Crown of everything that it had done in respect of Hungary since Ferdinand had sanctioned the April Laws. And it was no mere statement of a legal case, for Deak’s followers now adapted, with enthusiasm, his doctrine of the illegality of the regime as justifying them in refusing to pay their taxes. Arrears of taxation from Hungary continued to be an important item on the debit sheet of the national finances, and to collect what did come in cost the services of large numbers of troops.114
The resistance in Lombardy-Venetia was less systematic, for the local Italians possessed no Deák. It may even have been less widespread. But here, too, there was enough obvious disaffection to compel Austria to keep a considerable garrison in the provinces.
In 1856 and 1857 Francis Joseph made various attempts to popularize his regime, and to make it deserve popularity by relaxing its severity. In the autumn of 1856, taking his wife with him, he made an extended tour of the Italian provinces, visiting all their main cities and spending a considerable time in Milan. He granted another amnesty, under which thousands of political prisoners regained their freedom (the military and the police had advised against this measure, but Elisabeth pleaded for it), and the sequestrated properties of the exiles were restored to them. Radetzky, who had, indeed, reached the ripe age of ninety-one, was retired, and the Emperor’s own brother, the mild and affable Maximilian, sent down in his place.115
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