The Habsburg Empire (1790-1918)

by C A Macartney

  In other occupational fields, 524,000 persons (3·1%) were deriving their living from the public services35 and free professions, 520,000 (3·1%) from commerce and banking, 407,000 (2·4%) from communications, and there were 248,000 (1·5%) rentiers and pensioners, and 404,000 (2·4%) domestic servants.

  Nevertheless, the country was still mainly rural, and agriculture was still by far its largest single industry. In 1900, 11,200,000 persons in the Kingdom (66·5%) still derived their living from agriculture, forestry and fisheries,36 and 80% still lived in scattered farms, villages or small towns. Even the figure of 20% for the larger conglomerations might easily mislead, for several of these were ‘village towns’, most of whose inhabitants were agriculturalists.37

  Croatia was even less ‘developed’. Here 82% of the population still derived its living from agriculture, and only 8·3% from industry, 2% from the professions, 1·5% from commerce and banking. Only 0·8% were rentiers or pensioners. Zagreb was the only city with a population of over 50,000 and only one other, the garrison town of Eszék, topped 20,000.

  Moreover, even if Hungarian agriculture had lost a little ground percentually to other occupational groups, it had in other respects fully maintained its leading position in the national economy. Nowhere had the face of Hungary changed more than on the land.38 The cultivable area of the country itself had been greatly enlarged through various enterprises, including the regulation of the Tisza, which alone reclaimed 6·5 million hold for cultivation.39 The area of arable land had risen from 10 million ha. in 1870 to 12 millions in 1890, and in 1900 only 5% of the total area of the country was classified as uncultivable, compared with 15% in 1848. In absolute figures, considerably more people were working on the land in the latter year than in the former. There had been much improvement in methods of cultivation. Crop rotation had cut by half the amount of land left fallow each year. The vineyards had been ravaged by the phylloxera, but with that exception, the yield of all crops had risen substantially, and the stocks of horses, cattle and swine had been greatly improved. Consequently, the national production of almost all crops had risen substantially: that of wheat, sensationally, from 12 million q. in 1851 to 17 in 1865, 21 (average) in 1871–9, 30 in 1880–9 and 50 in 1890–9.

  This last development had, indeed, not been altogether healthy. The high wheat prices prevailing in the 1850s and again in the boom years round 1870 had tempted the cultivators to concentrate heavily on this one crop. The big landlords, in particular, had often sold their large herds of cattle and put the former pastures under wheat. Shortage of manure was already beginning to exhaust the new ploughland, and the whole national economy had become dangerously dependent on the price of wheat. Two landowners who visited the U.S.A. in 1878 warned their colleagues of the danger, and an Agricultural Congress in 1879 advised producers to go over to other crops, but with little success: the area under wheat, still only 2 million ha. in 1870, had reached 3 million in 1890 – 30% of the total area under plough.

  When it celebrated its millennium in 1896, the Hungarian people indulged in something like an orgy of self-congratulation. The historians of later generations have, on the other hand, seen in the Liberal era little more than a dismal story of wasted opportunities and achievements which profited the individual at the expense of the community. As when the record of any period is reviewed in perspective, a case could be made out for either judgment.

  The material development had, after all, been considerable. The industrial shape of the country reflected the truth that it belonged economically within a larger unit. Thus some industries which would have been present in an autarkic system, notably the textile industries, were in their bottle-fed infancy, others almost entirely absent, but others which were based directly on the native raw materials were really important. Agriculture was under-mechanized, but technically on a high level. The great obstacle which had so long retarded the entire development of the country – its backward communications – had been largely overcome. Hungary now possessed an extensive network of railways40 which had, indeed, been planned to radiate outwards from Budapest, so that cross-country journeys were slow and difficult, and direct communication across the frontier from outlying parts even more so (this was a particular grievance of Croatia’s, and a justified one), but communications between the capital and the chief points on the periphery were excellent. The whole system had been given a great impetus by the introduction in 1889 of a zone tariff which made cheap long-distance travel possible. The main roads had been improved out of recognition, and many of the chief waterways made fully navigable.

  The devotion – and the substantial sums of money – which had been lavished on making Budapest the capital of a proud and independent country and the peer of Vienna had yielded impressive results. Besides the original Suspension Bridge which had been the child of Széchenyi’s inspiration, four more bridges for road traffic and one for railway now connected the twin cities. Both of these contained large numbers of grandiose new buildings: the Royal Palace, reconstructed as an enormous building containing 860 rooms,41 the great neo-Gothic Parliament, built in a style reminiscent of Westminster, a Court opera and Court theatre, and a host more. The art galleries, museums and libraries of Budapest could vie with those of any European State of comparable size.

  Budapest had been pampered at the expense of the provincial towns, but many of these had modernized at least their centres in styles which aroused the admiration of the age, if not always that of its successors.

  It may be worth emphasizing that of the latter, some which had made the biggest progress lay in the non-Magyar periphery of the country, for the initiative in establishing new industries had been left almost entirely to private entrepreneurs, who had sited their factories where labour was cheap and natural conditions favourable. Only the great munition works at Csepel had been deliberately sited, for national reasons, in the heart of the country.

  We have mentioned Széll’s and Wekerle’s work in bringing order into the national finances and in breaking the vicious circle of deficits met by borrowing which only left them larger. This had been consolidated by taxation reforms which had raised the revenue. In 1892, when Hungary accompanied Austria on to the gold standard, the total national debt was consolidated into gold rentes. It is true that the public debt was still heavy, totalling about 5,000 million kronen, with an annual service of nearly 300 m.k., and that more than two-thirds of it was held outside the country; also that to achieve the result, a large amount of State property had been sold, usually (as is the rule in such transactions) on terms advantageous to the buyer.42

  The reorganization of the administration had been a big achievement, and the general level of the administrative services had been greatly improved in connection with it. The Hungarian Courts, after their reorganization, enjoyed a deservedly high reputation, except, indeed, where political issues were at stake. Public security was good.

  The execution of Eötvös’s elementary education act had been hampered by material difficulties, and by conflicts of competence between Church and State, and became involved with the Nationalities issue in the fashion described below. Nevertheless, the number of elementary schools had increased largely, and illiteracy, while still remaining high for many years, was diminishing in a measure which could not be denied.

  The number of secondary and higher educational establishments was substantial. It included a number of technical and specialist colleges, a second University (in Kolozsvár)43 and a technical High School of University rank in Budapest.44

  The period had been one of great intellectual, artistic and literary activity, the products of which, if lacking something of the freshness of those of the preceding generation, and of the distilled but often bitter refinement of the next, were yet imposing in quantity and in some cases – the novels of Jókai and Mikszáth and the paintings of Munkácsy and Szinnyey-Merse may be given as examples – indisputably high in quality. A number of valuable historical works came from the Academy, and in Loránd
Eötvös and Ignác Semmelweiss Hungary produced two of the outstanding scientists of the Europe of the day.

  All this added up to a very considerable sum of achievement, but it had been accompanied by a social development which in some respects had been remarkably slow, and in others, unhealthy, and this in its turn found expression in a political system which was singularly unmodern, if not in its institutions, at least in its operation of them.

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  One conspicuous feature of Hungarian society even as late as 1903 was the absence of a middle class possessing its own outlook and interests, and yet constituting an integral part of the national structure.

  It contained, of course, its administrative class, which towards the end of the period had come to play a very important role in the national life. But it was not an independent role. A certain contingent of these services (in some of the Ministries an important one) came, indeed, from old German burgher families, or families of prosperous Swabian peasants.45 The great majority of the Grade A civil servants, however, were members of the old landlord class, or their sons, whose acres could no longer afford them a living. And the change of habitat and occupation, and even of direct economic interest, left the social outlook of these men unchanged to an extent which would appear almost uncanny to an observer unfamiliar with the national psychology. To them, the only real difference between their old positions and their new was the unimportant one that the salaries received by them for administering Hungary were no longer paid to them direct by their peasants, but collected and handed to them by the State, of which they remained at once the servants and the beneficiaries, and most truly the incorporation. It was no less remarkable how completely this outlook was adopted by the minority among them whose origin was different.

  The result was the curious phenomenon of a system which seen from one angle, had changed completely, from one of decentralized self-government to one of centralized bureaucracy, but had remained practically unaltered in the spirit in which it was administered.

  The other section of what are usually known as the middle classes – the traders, industrialists, etc., would in any case have played a less important role than their counterparts in Austria because, owing to the slower economic development of their country, their numbers were smaller. But the social and political weakness to which the paucity of their numbers in any case condemned them and to some extent, also the professional men, was accentuated by other factors of a different order. That the German-Austrian bourgeoisie had, during the same period, been able to play a political role which was even disproportionate to its numerical strength had, as we have seen, been due to the reinforcement which it drew from various adventitious circumstances. It represented the centralism which was one of the two great rival principles which were contending for the mastery in Austria. It was ethnically or at least linguistically identical with the largest single nationality in Cis-Leithania. It was of the same stock from which the bulk of the Austrian administrators were drawn.

  While the stock of the older industrial and commercial classes in Hungary had been the same Germanic one as the Austrian, this, in the different national context, had had precisely the opposite effects on their position, the national difference accentuating the conflict of social and economic interests which divided them from the Magyar landlords. The development of the bourgeoisie after 1848 did little to efface these differences. It was true that the Germans who formed its nucleus now Magyarized, and as a rule, quite whole-heartedly; but they themselves were now ousted from the leading positions in Hungary’s industry and commerce, and to a large extent, in her professional classes, by the Jews, whose invasion of these fields was even far more complete in Hungary than in Austria.

  The arrival of the Jews in Hungary, as in the Western Lands, had been mainly a nineteenth-century phenomenon. In 1787, when they were first counted (soon after Austria’s acquisition of Galicia) they had numbered only 87,000 (1% of the population), but immigration, chiefly from Galicia,46 coupled with a high rate of natural increase, had raised their figures, in spite of considerable emigration westward,47 to 249,000 (1·89%) in 1840, 343,000 (2·65%) in 1850, 542,000 (4·0%) in 1869, 625,000 (4·6%) in 1880 and 830,000 (8·49%) in 1900. They were then still thickest on the ground in the Carpathian and sub-Carpathian regions which formed the first stage of their journey, but there was now no town, and hardly a village (except an occasional German settlement in the south) from which they were entirely absent, and Budapest itself contained over 167,000 of them – 23·4% of its total population.

  All that has been said elsewhere of the commanding position acquired by the Jews in Austria applies even more fully to Hungary, where their opportunities were much greater and the competition which they had to face much weaker. The capitalist development of modern Hungary, in so far as it had been carried out by ‘domestic’ forces at all, had been almost entirely of their making, and the results of it were concentrated chiefly in their hands. The occupational statistics for 191048 showed that 12·5% of the ‘self-employed’ industrialists and 21·8% of the salaried employees in industry, 54% of the self-employed traders and 62·1% of their employees, 85% of the self-employed persons in finance and banking and 42% of their employees, were Jewish, and even these figures, failing as they do to distinguish between enterprises by size, do not reveal the whole position, which was that practically all banking and finance, far the greater part of all trade, and most industry above the artisan level, were owned and staffed in their higher branches by Jews, and most of the money earned in these occupations, outside the wages – direct profits, dividends, and higher salaries – went into Jewish pockets. The only source of privately-earned wealth which seemed not yet to be chiefly in Jewish hands was the land; but even here, Jews now owned 19·9% of the properties of 1,000 hold + and 19·0% of those between 1,000 and 200 hold and constituted 73% of the lessees in the former bracket and 62% of those in the latter. And what proportion of the rent-rolls from the larger estates went straight into the pockets of their owners’ Jewish creditors, statistics do not record; but it was undoubtedly a very large one.

  Tradition kept them out of the Civil Service, and out of the regular armed forces,49 and they were naturally confined to their own proportions in the Churches and Church schools, but in the free professions generally, they had reached almost as strong a position in the intellectual life of the country: 11·5% of the teachers in the burgher schools were Jewish, and a substantial and growing number of the University teachers; 26·2% of the persons entered under the rubric ‘literature and the arts’, including 42·4% of the journalists; 45·2% of the advocates and 48·9% of the doctors, were Jews.

  The contribution made by the Jews to the development of the new Hungary was, beyond doubt, enormous. Given the incurably conservative mentality of the Magyars, it is hard to see how, without the Jews, Hungary could ever have accomplished the transition from a ‘feudal’ to a modern capitalist economy. Their contribution to Hungary’s intellectual and artistic life was hardly smaller: a very great number of the nation’s most boasted achievements in learning, science, literature and the arts were the work of Jews. It is, however, undeniable that their infiltration of the national life, on such a scale, raised a problem quite different from that presented by the German or Slovak newcomers to the national middle class. The habits, religion, even the family trees of the latter, if traced back far enough, differed little from those of the old-established ‘Magyars’, and old and new fused easily, and, as it then seemed, completely enough. If they took from the original product a little of its happy-go-lucky charm, they enriched it in return with their own qualities of sober worth, and the Magyar psychological strain nearly always proved the dominant one.

  The Jews entering Hungary, on the other hand, nearly all came to it as the products of many centuries of segregation, partly enforced, partly self-imposed, and distinguished from their neighbours, not only by their religion, but also by their jargon and their dress. Naturally, the longer they stayed in the country
, the more they tended to discard the outward distinctions, but precisely those who did so most readily were those who then passed on to the West, while their places were filled, and more than filled, by new arrivals from Galicia. Moreover, few of the Jews themselves were prepared to go the whole way towards assimilation. Many were passionately anxious to appear Magyars in all externals, and even to be Magyars in all except their religion,50 and when in 1906 the Jewish community in Hungary split into two great bodies, the Neologs and the Orthodox,51 the latter, which wanted the old ways preserved intact, was much smaller than the former, which favoured complete social assimilation, but even the Neologs discouraged changes of religion, which were, in fact, extremely rare.52

  In the Vormärz and 1848–9 the great majority of Hungary’s Jews had taken her side against Vienna, and in 1867 the Hungarians remembered this in their favour with gratitude. The new Governments saw in them useful allies for the future, both economically, and no less, owing to the Jews’ willingness to assimilate linguistically, in the national struggle. At that time there was, moreover, practically no element of rivalry, such as already existed in Vienna and Bohemia. The middle-class Hungarian did not want to go into money-making himself; he was only too glad to leave that side of the nation’s business to the Jews (who, as he was well aware, were much better at it than he was), and to draw his salary out of the profits made by them. To these considerations of expediency were added entirely sincere ones of principle, for the Hungarian Liberals (here understanding under that term not only the political party which bore the name, but the whole generation, including such men as Deák and Eötvös), were as genuinely convinced as their Austrian opposite numbers that it was morally wrong to draw a distinction between man and man on grounds of religion or ethnic origin. All the Governments of the time were therefore, as we have seen, at pains to admit the Jews to full civic and political equality, and to give them their share of social reward.53 Anti-Semitism was strongly discouraged, and was in fact much less of an open political issue than in Austria. In 1880 a Deputy named Istóczy founded no less than 78 specifically anti-Semitic organizations, and in 1884 got 17 Deputies into Parliament, a year after a notorious ‘ritual murder’ trial had taken place in Tisza-Eszlár. The Government, however, turned its batteries on the movement, and it soon disintegrated. After it the only major Party to include a touch (not a very big one) of anti-Semitism in its programme was the Christian People’s Party.