Austrian Empire

Austria-Hungary was a union of two distinct states, the Empire of Austria and the Kingdom of Hungary, under one common ruler. The head of the House of Habsburg was both the Emperor of Austria, and the King of Hungary. Both halves of the Dual Monarchy had their own distinct parliaments and governments. Both halves of the empire were also multinational states in which one ethnic group was dominant, and other ethnic minorities made up significant geographical regions of the state. In Austria the dominant ethnicity was German, but also included Czechs, Poles, Ukrainians, Slovenes, and Slavs. In Hungary the dominant ethnicity was Hungarian (Magyar) but also included Slovaks, Romanians, Germans, and Slavs.

While the ethnic Germans and Hungarians made up most of the Nobility and owned much of the land, and thus had most of the political power, Austria-Hungary did have some of the most progressive laws in Europe securing ethnic minority rights and representation. Many of the ethnic tensions in the empire revolved around Hungary which tended to have a more strained relationship with both Romanian and Slavic minorities, particularly over land ownership and political representation. Hungary, despite laws to the contrary, engaged in "Magyarization" in which ethnic minorities were pressured to adopt Hungarian language and customs.

Following the Great War, in 1919, the Kingdom of Hungary suffered a Republican Revolt and rejected their Habsburg king. This officially ended the Dual Monarchy, and the remaining portions of the old empire became simply the Austrian Empire.

## Austrian Empire

### Date Formed

1919 (Imperial Reform - Hungarian Revolt)2020 (Declared Independence from EarthGov.)

## Post-War Crisis

By 1917 the situation in Austria-Hungary was dire. Food shortages became endemic causing riots and strikes in the industrial centers of lower Austria and Bohemia. The civil administrative bureaucracy barely functioned due to many trained officials being drafted into military service, and the military bureaucracy directly interfering with civil government.

Suspicion and discrimination within the Military command structure also significantly worsened ethnic tension within the empire. Violations of civil rights, and even atrocities were perpetrated by the army if there was any suspicion of subversive activity or sentiment.

The one bright spot for the House of Habsburg was that the monarchy itself still had widespread support even among the ethnic minorities of the empire. The monarchy was still seen by most as a stabilizing influence and a protector of the people. The popularity of Emperor Karl I also soared when news of his successful peace initiative broke to the public.

Despite the rise in public morale, the civil government was in shambles and the economy was on the brink of collapse. Many of the trained bureaucratic staff had been conscripted during the course of the war. In addition the military had routinely interfered with civil government, essentially attempting to implement martial law. The Austrian Parliament had been suspended from the beginning of the war, and civil rights across the empire had suffered significantly under military rule.

The economic output of the empire had fallen by 40% since the beginning of the war and food shortages began to become common in 1917. Food riots and strikes had begun, hurting economic output further.

Agricultural output had declined as well due to conscription of farm workers, but requisitioning of trains for moving troops and military equipment also stopped the transport of grain and coal. Tons of both resources sat at railheads waiting, while people in lower Austria and Bohemia went hungry and cold.

The emperor’s first action was to restore the Austrian Parliament. Second was the prioritization of food and coal shipments from Galicia. This meant delaying the withdrawal of military assets from the eastern front.

Conditions for most of the populace would continue to worsen through the winter of 1917, though the worst was avoided as food and coal shipments finally arrived from Galicia. The lack of rail transport, however, meant that troops were languishing in the field with little to keep them busy. In January of 1918, groups of soldiers began looting and committing atrocities against local populations in Galicia and Transylvania. There was little the central government could do to reign in these abuses as the chain of command had become unreliable on the periphery.

By summer of 1918, the situation would evolve again as the newly declared Republic of Poland, and the Western Ukrainian Republic both claimed territories in Galicia. Karl ordered withdrawal of troops from Lviv, leaving much of the heavy military hardware in place for the Polish forces to claim. Despite the end of the Great War, fighting broke out again. Polish, Ukrainian and Red Army forces all clashed for control of western Ukraine and Galicia. Many ethnic Poles and Ukrainians deserted from the army to join their respective countrymen in the fight for Galicia.

The military withdrawal meant the de facto loss of Galicia. This would be a blow to the empire’s food production, but the army was in no shape to fight, and Karl was unwilling to shed more blood for land, especially land it was unlikely he could hold anyway.

Over the autumn of 1918, the Austrian demobilization proceeded apace, despite warnings and grumbling from Karl’s military staff. The High Command, not surprisingly, felt that maintaining a strong military would be essential to holding the empire together and suppressing nationalist and separatist sentiment. Though their fears were not unjustified, the Emperor felt that the state could not bear the strain of keeping near 2 million men in the field.

The Crisis would come to its final flash point in early 1919, when Emperor Karl declared his intention to pursue a Trialist solution, with the approval of the Austrian Parliament. The Hungarian nobility were outraged and favored separating from the empire. This decision would be taken out of their hands, however, when a Republican Coup led by Count Mihaly Karolyi took control of the state, and declared independence from Austria.

### Economic Crisis

During the war, Austria-Hungary abandoned the Gold Standard and sold war bonds to finance the war effort. This resulted in a massive increase in circulating currency as well as public debt. The inevitable result was inflation. By 1917, consumer prices were sixteen times higher than they were in 1913.

Austria now faced payments of War Indemnities imposed by the Treaty of Ghent, financing the war debt, costs of refitting industry for peace time production, and importing food. In the short term, the only options was simply to print more money. As a result by 1919 inflation had risen to the point it required 62 paper Kronen to equal one 1913 Gold Kronen.

The situation in 1920 was helped both by the influx of Croatian lands formerly owned by Hungary and the Hungarian nobility, and by foreign loans and capital investment. Austrian industry was beginning to strengthen once again. Croatian land, formerly owned by Hungarian nobility, was appropriated by the Imperial Crown following the Hungarian revolution and the exit of Hungary from the empire. This allowed the Imperial government to sell off land to Croatian peasants at reasonable prices. This generated little revenue as many of the purchases were made with government loans, which amounted to the government paying itself in the short term. It did, however, offset inflation that would otherwise have resulted from the loans.

Before the war, approximately 73% of arable land in the empire was owned by the nobility, 8% was owned by the middle classes, and 19% by the peasantry. Increased taxation resulting from the levying of high taxes on large agricultural land holdings of the nobility, and increased taxation of large corporations, also helped to alleviate the inflationary crisis and prevent hyperinflation.

As increased taxation began to bite the large Aristocratic landholders, the rush to sell flooded the market for agricultural land, driving down prices, much to the benefit of peasants looking to purchase their own land. By 1922, the price of arable land had fallen from nearly 20 times it's annual production revenue, before the war, to 4 to 5 times its annual production revenue.

## Imperial Reform Conference

The war both created and revealed severe weaknesses in the bureaucracy, military command, social fabric, and infrastructure of the empire. The old models of leadership based upon aristocratic nepotism allowed too great a degree of incompetence. Emperor Karl was also, however, leery of Prussian style professionalism. This clearly gave too much control to experts that were blind to the bigger picture. The narrow vision of experts had nearly destroyed the world. Perhaps the greatest failing of both the Aristocratic and the Professional was a fatal degree of hubris.

Karl would not simply toss aside the Aristocratic traditions of the Empire nor the beloved heritage of the Habsburg dynasty. Least of all would he lay aside his duty as the Emperor and the sacred trust that entailed. Nevertheless, he recognized the inescapable need for reform. Philosophically he was loath to use the term "modernization" and yet he could not, himself, articulate the philosophical framework in which the necessary reforms could be founded. He needed a framework that would encompass the best of the traditions he loved, with the pursuit of excellence in the changing context of the world. To this end, and with the encouragement of his beloved wife Zita, Karl I called a convocation of Catholic Intellectuals from across Europe for the express purpose of discussing the application of Catholic tradition in the modern world.

This convocation would quickly increase in scope as sessions were planned to address not only philosophy and tradition, but also economics, land reform, labor policy, law, and politics. The Imperial Reform Conference would be opened on March 25th of 1919 with Mass at St. Stephen's Cathedral, followed by a general address of the Apostolic Nuncio to Austria.

The first round of sessions were devoted to the topic of tradition and modernity. This was followed by a series of sessions on monarchism, democracy, and representative government. After these came sessions on the economic and social principles of Rerum Novarum. Some of the major speakers and attendees in these sessions included Louis Billot, Aleš Ušeničnik, Reginald Garrigou Lagrange, Jacques Maritain, Oswald von Nell-Breuning, G.K. Chesterton, and Hillaire Belloc.

These initial sessions culminated in producing a series of guiding documents which would be used by subsequent committees to formulate policy recommendations. Specific committees were set up to produce recommendations to the Emperor on economic policy, land reform policy, labor policy, and political and bureaucratic structures.

## Imperial Reforms of 1920

### Political Reforms

Prior to the Hungarian revolution, it had become obvious that the Austrians were leaning towards granting equal status to the Croatians, possibly under a Kingdom of Illyria. When Hungary separated itself from Austria in the coup of 1919, the Croats took the opportunity to escape the control of Hungary and remain with Austria. The weak Karolyi government was too busy with multiple other crises to do anything about this.

Following the Imperial Reform Conference, a version of Trialism would be adopted with the Austrian Empire being reorganized into three states, Austria, The Kingdom of Bohemia, and the Kingdom of Illyria. Each of these states would have it's own constitution, parliament, and government headed by a Prime Minister. Each would have their own judiciary and constabulary. Each would have the right to levy taxes on their people, and the right to have a small national defense force.

Foreign policy, the military, trade policy, and inter-state infrastructure, such as rail, roads, and electricity, would be under the jurisdiction of the Imperial government. The new Imperial constitution would enshrine minority rights through out the empire and establish an imperial court of last appeal as well as an office of Imperial Inspectors with legal jurisdiction across the empire.

Across the empire, citizens would be enrolled in a class, similar in concept to a guild, based upon occupation or station in life. For example one might be enrolled as nobility, clergy, agrarian, commerce, industrial, technical, or academic. If a citizen qualified for more than one class, they could choose their enrollment, and could change their enrollment once every three years. Each class would elect three representatives, one from each state of the empire, to sit in the Imperial Diet. The Imperial Diet would have to approve taxation, fiscal policy, trade policy and make recommendations to the Emperor on most other policy areas.

### Economic Reforms

Rather than nationalizing industries, or capital, the economic reforms focused on using tax incentives and penalties to direct a reorganization of business and industry. Businesses would be categorized into three classes. First is small businesses. This category would include businesses with one hundred employees or less. Businesses in this category would have preferential tax status and limited regulation. The second class of business would be structured as guilds with member ownership. Guilds would receive preferential tax status, but would be required to follow specific ownership structures and guidelines. Lastly, the third category consisted of large businesses, consisting of more than 100 employees that do not have a guild-member ownership structure. Businesses in this class would be subject to higher taxation, though they could receive tax-credits for allowing labor unions.

Labor unions were to be allowed and even encouraged. However, they would also be subjected to taxation if they formed on a national, industry-wide basis. Localized unions, and single-company unions would not be taxed.

Land reform would similarly be handled by tax incentives and penalties. Land holdings would be classified by category and size. Land could be agricultural, recreational, urban, and resource. Agricultural landholdings less than 600 hectares would be subject to a small annual tax based upon expected annual revenue. Holdings larger than 600 hectares would be taxed at a moderately higher rate, and holdings larger than 1000 hectares would be taxed at a higher rate still. Non-arable land, and traditionally uncultivated lands such as forests, hunting reserves, mountainous regions, and wild lands, could be categorized as recreational, or undeveloped, and would not be taxed.

Land used for resource exploitation, such as logging, or mining, would be classified as resource land, and would also be taxed at a small percentage of expected annual revenue.

When selling off agricultural, or resource land, the wealthy could accrue tax credits lasting for a period of years, and enable designation of more important family lands as recreational. Lastly, the government would make loans available to lower class farmers to enable them to purchase their own lands.

For further information see Austrian Distributism.

## Hungarian Revolution

For Austria, once the Hungarian Revolution had become a fait accompli, the most pressing issues of the day became to end the ruinous food shortages and to figure out the practical implementation of the Trialist solution that the emperor had announced in 1918. Karl I created a series of councils and conferences of political theorists and economists to formulate a plan for the reorganization of the empire.

Count Tisza was initially of a mind to retire from political life, having been forced to leave his beloved Hungary and seeing it fall to the hated socialists. He had also been in conflict with Emperor Karl I prior to the end of the Great War, which had led to his resignation as Prime Minister of Hungary. Supporters of the status quo, however, saw Count Tisza as a valuable asset and pushed for his inclusion in the Trialist conferences.

In the subsequent debates the two great issues were the land question and the question of local autonomy. In the compromise of 1867 Hungary had been granted local autonomy and had thus been given a completely separate and autonomous government, united with Austria only in foreign policy and military affairs. The Trialist solution, in principle, had meant extending this same local autonomy to the Croatians under the new Kingdom of Illyria.

In addition, many of the empire’s citizens were peasant farmers who worked on lands owned by the aristocratic elite. For the Croatians this had been a mixture of Hungarian and Austrian nobility. The primary demand of this peasant majority was the desire to own their own lands. The leftist agitators who had most of their constituents among the factory workers of the cities, had long attempted to gain the support of the rural peasant populations with promises of land redistribution.

The situation had changed considerably with the Hungarian revolution and Hungary’s subsequent exit from the empire. The Dual Monarchy had essentially come to an end and thus in a certain sense the Trialist solution had become simply another Dual Monarchy. In addition, Hungary lost all of its former territories in Croatia and the Hungarian nobility had been dispossessed. This meant that the Emperor effectively had lots of Croatian land to dispose of.

The proponents of the status quo essentially favored the solution of simply creating a new Dual Monarchy with the Croatian Kingdom of Illyria taking the place of the former Kingdom of Hungary. They also wanted the former lands of the Hungarian nobility to be returned to those nobles who had fled from Hungary and the rest made available for purchase.

Another faction proposed creating a federal state with Austria, Bohemia, Slovenia and Croatia each having a national assembly. The national assemblies would run the local states, and the federal parliament would legislate for the federal super state with the Emperor acting as the Executive. This group favored allowing the land redistribution question to be settled by the national assemblies.

The Emperor himself was a devout Catholic and was desirous of implementing the Church’s social teachings. He was particularly interested in the teachings of Rerum Novarum and commissioned a panel of political theorists and economists to provide recommendations on how the principles of Rerum Novarum might be implemented in the reformed Austrian empire.

The Emperor wanted to reconcile three primary concerns, equity for all parties to bring about an end to ethnic and class strife, a system which would support the modernization of the military, and the preservation of Imperial authority and prerogatives.

In a surprise move, Karl invited Count Tisza to participate in the Rerum Novarum Commission. A staunch Calvinist, Tisza had little religious sympathy for Rerum Novarum, and he did not like its apparent support of restrictions on the free market. He did, however, like that the document not only recognized but insisted that cooperation between the classes was possible and indeed essential to a good society. He himself had always insisted that the idea of necessary class conflict as a historical construct was nonsense. Though he had never favored any kind of land reforms, he did recognize that there were important benefits to be found in depriving the socialists of one of their key propaganda points, especially in light of having lost his beloved homeland to a Soviet revolution.

The recommendations of the Rerum Novarum commission were extremely controversial and strongly opposed by the entrenched nobles who wished to maintain the status quo. They were dealt a significant blow, however, when Count Tisza unexpectedly came out in favor of the recommendations.

In the end Karl’s proposals won the day and led to the establishment of a political and economic system unique in Europe.

## Austro-Italian War

In may of 1923 the new fascist government of Italy occupied the Papal territories secured by the Lateran Treaty. The Vatican itself was invaded by fascist Blackshirts and the pope had been forced to flee into exile.

Though Austria was just beginning to climb out of the post-war troubles, Emperor Karl I saw himself as the last great Catholic Monarch of Europe and as such obliged to come to the aid of the Church. When the pope, now in exile, made a plea for aid and international action, Karl I went to the Imperial Parliament and asked for a declaration of war on Italy.

Between just beginning to recover from the post-war shortages and economic woes and beginning planning for the Imperial reforms, it took Austria some time to mobilize the military. As a result the first real assault on Italy could not be launched until late fall. Rather than invading during the winter the Austrian high command decided to delay until spring and use the extra time to thoroughly stage and supply the invasion forces.

During this time the Pope also called for volunteers and declared the formation of an International Catholic Volunteer Corp. Although the Pope did not officially use the term, many traditionalists took to calling this a new crusade. The surviving Swiss Guard took the opportunity to bolster its numbers. In addition many Monarchist French, Irish, Bavarian, and Polish volunteers flocked to the new Catholic Volunteer Corp. The Palatine Guard was also retrained and rearmed to form an effective fighting force on a modern battlefield.

Extra time for the Austrian and Papal forces was also extra time for the Italian fascists. When the offensive was finally launched in the spring of 1924, it found the Italian forces well prepared and dug in. During the spring and summer Austrian forces could make little headway.

The war ended with Austrian victory in 1926. Austria reclaimed territories lost to Italy in the Treaty of Brussels and Italy was broken up.

## Post-War Economic Boom

In 1928 an economic boom had begun in the major industrial powers, Great Britain, Germany, and the USA, as well as in South America. Growth came somewhat slower to the Austrian Empire, but by 1933 the economy was experiencing excellent growth. Partially due to the French economy still languishing, Austria would vie with Japan for ranking as the 4th biggest industrial economy in the world.

## Succession and Mid-Century Diplomacy

In 1936, having finally set the empire on a stable footing for the future, Karl I of Austria would die of heart failure and pneumonia. Karl would be remembered as a peace maker and a ruler devoted to the good of his people. Karl’s eldest son Otto would succeed him and become Emperor at the age of 24.

Otto had just finished his PhD in Political Science from the University of Louvain when his father died and he ascended to the Imperial throne. He was a strong proponent of cooperative relations among the European powers. While at university, Otto had met Luis Prince Napoleon. The two developed a friendship that would continue when each became the leader of their respective nations. This friendship was further bolstered by Otto's opposition to the French lead Comintern and its many sponsored radical and subversive member organizations around the world.

Austria would maintain close ties with the Third French Empire through out the 20th century and into the age of stellar colonization.

Relations with Germany were initially tense following the conclusion of the Great War. Many in Germany regarded Austria both as the reason they were brought into the war in the first place and as a contributing factor to their loss. Otto pursued a renewal of ties with the young Kaiser Wilhelm III and once economic prosperity returned, Austria and Germany were able to strike mutually profitable trade agreements.

### Military Reforms

Austria's military performance in the Great War, with a few exceptions, was something of an embarrassment. This continued a trend of military under-performance going back to the Austro-Prussian War of 1866. Even before the Austro-Italian War, Karl I had undertaken to reform the Military. The improvements of the initial reforms were evident in the victory over Italy. This victory also did much to restore morale in the Imperial Army.

Otto V resumed comprehensive military reforms in 1938.

## Space Race

In 1940 the Imperial government contracted with the Falkenberg (Monfalcone) Shipyard to begin work on an Austrian space program, the Agentur Kaiserliche Astronautik. The first AKA space-flight launched in 1944.

The AKA began building an Austrian orbital space station in 1951 and completed the station in 1958. One year later Austrian explorers established a mining outpost on Ceres and began mining in the asteroid belt.

1968 Austrian colony on Callisto

1969 Bonapartist enclave in Callisto colony

#### Discovery of Triangulum

In 1960, Austrian miners of the Solar Mining Guild discovered deposits of a previously unknown element. Initial research on the element proved dangerous as the element was only stable at very low temperatures. A serious accident early in research resulted in an explosion that had unexpected side-effects. In the aftermath of the accident Austrian scientists found that the space-time continuum was unstable in the area where the explosion had occurred and there was evidence of other dimensions intruding into our universe.

Further research would lead to the conclusion that there were three universes interacting, including our own 'prime' universe. The new element had the unique property that it existed in all three universes at once, as a result it was named Triangulum. The new element would prove to be an unparalleled energy source. Triangulum would be the first step in the revolution of space travel that would lead eventually to stellar colonization.

Austrian scientists initially studied Triangulum in secret, but before long the discovery was published and samples were provided to German, British, and American scientists as well. Austria would begin exporting Triangulum in 1962, leading both to an economic windfall for the Austrian Empire, and also to a revolution in power generation and propulsion in space travel.

#### Ancient Ship Discovery

In 1961 Bonapartist French explorers discovered a large object orbiting below the upper cloud layer of the Jovian atmosphere. In a daring salvage operation they managed to tow the object out of Jupiter’s atmosphere. It turned out to be an ancient ship of unknown origin. The Bonapartists didn’t have the resources necessary to exploit their find and as a result they partnered with Austrian interests to study the ship and attempt to reverse engineer its technology. This joint effort was codenamed Project Dreadnought.

The joint Austrian-Bonapartist salvage and research project would, in 1963, be organized under a Guild charter as the Altair Kaiserliche Gilde / Altair Imperial Guilde (The Guild of the Imperial Eagle). One of the first products offered for sale by AKG was advanced radiation shielding. Within a few years, AKG also offered significantly improved sub-light propulsion engines. In 1970 AKG began manufacturing artificial gravity tech.

### Stellar Colonization

The Austrian Empire and the Third French Empire became wealthy off of Triangulum and the technological advances made by AKG's Project Dreadnought. Their technology revolutionized space travel and became indispensable for any nation wishing to produce modern space faring vessels. The British Solar Commonwealth struck a deal with the Austrians to exchange their Faster Than Light drive technology for Artificial Gravity tech.

The Austrian-Bonapartist shipyard at the Calisto colony began building their first FTL capable ship in 1971. Over the next three years the Austrian Empire worked to put together a colonial expedition, and in 1974, the Austrian Colonial Expedition claimed the Cygni Tau and Epsilon 451 Systems. Epsilon 451 was renamed to Karlsberg and became the first colony site of the Austrian Empire.

Cyngi Tau would become the second colony site, renamed to Altair.