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 Mohács (1688). In 1688 the elector took Belgrade; in 1691 Louis William I. of Baden won the battle of Slankamen, and on the 11th of September 1697 Prince Eugene gained the crowning victory of Zenta. This was followed, on the 26th of January 1699, by the peace of Karlowitz, by which Slavonia, Transylvania and all Hungary, except the banat of Temesvár, were ceded to the Austrian crown. Leopold had wisely decided to initiate a conciliatory policy in Hungary. At the diet of Pressburg (1687–1688) the Hungarian crown had been made hereditary in the house of Habsburg, and the crown prince Joseph had been crowned hereditary king of (q.v.). In 1697 Transylvania was united to the Hungarian monarchy. A further fact of great prospective importance was the immigration, after an abortive rising against the Turks, of some 30,000 Slav and Albanian families into Slavonia and southern Hungary, where they were granted by the emperor Leopold a certain autonomy and the recognition of the Orthodox religion.

By the conquest of Hungary and Transylvania Leopold completed the edifice of the Austrian monarchy, of which the foundations had been laid by Ferdinand I. in 1526. He had also done much for its internal consolidation. By the death of the archduke Sigismund in 1665 he not only gained Tirol, but a considerable sum of money, which he used to buy back the Silesian principalities of Oppeln and Ratibor, pledged by Ferdinand III. to the Poles. In the administration of his dominions, too, Leopold succeeded in strengthening the authority of the central government. The old estates, indeed, survived; but the emperor kept the effective power in his own hands, and to his reign are traceable the first beginnings of that system of centralized bureaucracy which was established under Maria Theresa and survived, for better or for worse, till the revolution of 1848. It was under Leopold, also, that the Austrian standing army was established in spite of much opposition; the regiments raised in 1672 were never disbanded. For the intellectual life of the country Leopold did much. In spite of his intolerant attitude towards religious dissent, he proved himself an enlightened patron of learning. He helped in the establishment of the universities of Innsbruck and Olmütz; and under his auspices, after the defeat of the Turks in 1683, Vienna began to develop from a mere frontier fortress into one of the most brilliant capitals of Europe. (See )

Leopold died in 1705 during the war of Spanish Succession (1702–13), which he left as an evil inheritance to his sons Joseph I. (d. 1711) and Charles VI. The result of the war was a further aggrandizement of the house of Austria; but not to the extent that had been hoped. Apart from the fact that British and Austrian troops had been unable to deprive Philip V. of his throne, it was from the point of view of Europe at large by no means desirable that Charles VI. should succeed in reviving the empire of Charles V. By the treaty of Utrecht, accordingly, Spain was left to the House of Bourbon, while that of Austria received the Spanish Netherlands, Sardinia and Naples.

The treaty of Karlowitz, and the settlement of 1713–1714, marked a new starting-point in the history of Austria. The efforts of Turkey to regain her ascendancy in eastern Europe at the expense of the Habsburgs had ended in failure, and henceforward Turkish efforts were confined to resisting the steady development of Austria in the direction of Constantinople. The treaties of Utrecht, Rastadt and Baden had also re-established and strengthened the position of the Austrian monarchy in western Europe. The days of French invasions of Germany had for the time ceased, and revenge for the attacks made by Louis XIV. was found in the establishment of Austrian supremacy in Italy and in the substitution of Austrian for Spanish domination in the Netherlands.

The situation, though apparently favourable, was full of difficulty, and only a statesman of uncommon dexterity could have guided Austria with success through the ensuing years. Composed of a congeries of nationalities which included Czechs, Magyars, Ruthenes, Rumanians, Germans, Italians, Flemings and other races, and with territories separated by many miles, the Habsburg dominions required from their ruler patience, tolerance, administrative skill and a full knowledge of the currents of European diplomacy. Charles VI. possessed none of these qualities; and when he died in 1740, the weakness of the scattered Habsburg empire rendered it an object of the cupidity of the continental powers. Yet, though the War of Spanish Succession had proved a heavy drain on the resources of the hereditary dominions of the Austrian crown, Charles VI. had done much to compensate for this by the successes of his arms in eastern Europe. In 1716, in alliance with Venice, he declared war on the Turks; Eugene’s victory at Peterwardein involved the conquest of the banat of Temesvár, and was followed in 1717 by the capture of Belgrade. By the treaty signed at Passarowitz on the 21st of July 1718, the banat, which rounded off Hungary and Belgrade, with the northern districts of Servia, were annexed to the Habsburg monarchy.

Important as these gains were, the treaty none the less once more illustrated the perpetual sacrifice of the true interests of the hereditary dominions of the house of Habsburg to its European entanglements. Had the war continued, Austria would undoubtedly have extended her conquests down the Danube. But Charles was anxious about Italy, then in danger from Spain, which under Alberoni s guidance had occupied Sardinia and Sicily. On the 2nd of August 1718, accordingly, Charles joined the Triple Alliance, henceforth the Quadruple Alliance. The coercion of Spain resulted in a peace by which Charles obtained Sicily in exchange for Sardinia. The shifting of the balance of power that followed belongs to the history of (q.v.); for Austria the only important outcome was that in 1731 Charles found himself isolated. Being without a son, he was now anxious to secure the throne for his daughter Maria Theresa, in accordance with the Pragmatic Sanction of the 19th of April 1713, in which he had pronounced the indivisibility of the monarchy, and had settled the succession on his daughter, in default of a male heir. It now became his object to secure the adhesion of the powers to this instrument. In 1731 Great Britain and Holland agreed to respect it, in return for the cession of Parma, Piacenza and Guastalla to Don Carlos; but the hostility of the Bourbon powers continued, resulting in 1733 in the War of Polish Succession, the outcome of which was the acquisition of Lorraine by France, and of Naples, Sicily and the Tuscan ports by Don Carlos, while the power of the Habsburg monarchy in northern Italy was strengthened by the acquisition of Parma, Piacenza and Guastalla. At the same time Spain and Sardinia adhered to the Pragmatic Sanction. Francis, the dispossessed duke of Lorraine, was to be compensated with Tuscany. On the 12th of February 1736 he was married to the archduchess Maria Theresa, and on the 11th of May following he signed the formal act ceding Lorraine to France.

The last years of Charles VI. were embittered by the disastrous outcome of the war with Turkey (1738–1739), on which he had felt compelled to embark in accordance with the terms of a treaty of alliance with Russia signed in 1726. After a campaign of varying fortunes the Turks beat the imperial troops at Krotzka on the 23rd of July 1739 and laid siege to Belgrade, where on the 1st of September a treaty was signed, which, with the exception of the banat, surrendered everything that Austria had gained by the treaty of Passarowitz. On the 20th of October 1740, Charles died, leaving his dominions in no condition to resist the attacks of the powers, which, in spite of having adhered to the Pragmatic Sanction, now sought to profit from their weakness. Yet for their internal development Charles had done much. His religious attitude was moderate and tolerant, and he did his best to promote the enlightenment of his subjects. He was zealous, too, for the promotion of trade and industry, and, besides the East India Company which he established at Ostend, he encouraged the development of Trieste and Fiume as sea-ports and centres of trade with the Levant.