IV.

The Height of the Dual Monarchy: 1867-1895

For the first 20 years after 1867, Austria-Hungary enjoyed a measure of security both at home and abroad. Hungary was calm for the first time in decades. Under the guidance of Kálmán Tisza, Hungary's prime minister from 1875 to 1890, the Hungarian liberals in power were loyal to the compromise. The Magyars encountered strong resistance, however, when they tried to impose the Magyar language and Magyar culture on the non-Magyar peoples of Hungary. Austria experienced a period of reform and prosperity under German liberal governments from 1867 to 1879. After 1879, a coalition of conservative, aristocratic, clerical, and Slavic elements managed to neutralize the contending nationalities by setting one group against another so that no one group would ever become too powerful. This small group of political insiders known as the Iron Ring was controlled until 1893 by Prime Minister Count Eduard Taaffe, a childhood friend of Francis Joseph.

The Habsburg monarchy's foreign policy was simplified when it lost territory in Italy and lost the Seven Weeks' War to Prussia in 1866. It concentrated on maintaining commercial markets and keeping expansionist powers from claiming Habsburg possessions that were populated largely by Romanians and Slavic peoples. On the last point, Francis Joseph knew those territories were safe as long as he could prevent two or more great powers from uniting against Austria-Hungary. In their efforts to forestall such a combination, Austro-Hungarian statesmen showed considerable flexibility and ingenuity. They were able to achieve their foreign policy objectives peacefully by securing timely alliances with other great powers.

Austria-Hungary was most concerned about limiting Russia's expansion in the Balkan Peninsula. In 1878 the Balkan Peninsula was made up of the independent countries of Romania, Bulgaria, Greece, Serbia, and Montenegro, in addition to Bosnia and Herzegovina, which still belonged to the Ottoman Empire. In that year, with Britain's support, Austria-Hungary stationed troops in Bosnia, to prevent the Russians from expanding into nearby Serbia. In another measure to keep the Russians out of the Balkans, Austria-Hungary formed an alliance, the Mediterranean Entente, with Britain and Italy in 1887 and concluded mutual defense pacts, with Germany in 1879 and with Romania in 1883, against possible Russian attack. Relations with Serbia, Italy, and Romania were improved in the early 1880s with separate alliances. Finally, Austria-Hungary worked with Russia to resolve their mutual differences peacefully through the Three Emperors' League (1873-1878) and then the Three Emperors' Alliances (1881-1887). The three emperors were Francis Joseph, William I of Germany, and Alexander II (who died in 1881) and Alexander III of Russia. These measures helped Austria-Hungary to achieve security.