THE HAPSBURGS PREVAIL
As historian Alan Sked noted, historians are particularly inclined to consider the history of the Austro-Hungarian Empire in counterfactual terms.1 In particular they are prone to ponder the "what ifs?" of Hapsburg history from the frustration of Emperor Joseph II's reforms in 1790 to the calamity of World War I, in which it is often supposed that Austria's avoiding it, being on the winning side or even securing a negotiated solution early on would have saved it--at least for a time, and perhaps indefinitely.2 However, that only applies to those who actually bother to look at it, this being a comparatively neglected subject, with some appalling gaps in the historiography.3
Nonetheless, it is a subject very much worth exploring. The Hapsburg struggle with the Bourbons for dominion in Europe in the sixteenth, seventeenth and eighteenth centuries; the decline of the Holy Roman Empire; the unification of Germany; the struggle with the Ottomans, the division of Central Europe and the Balkans--their inherent fascination aside, these events are all of the utmost importance for understanding Western history and world history. Perhaps the most pertinent aspect of it for our moment is the fact of the Hapsburg Empire's character as a large, multi-national political entity in Europe, exactly what the European Union today is attempting to build.
The conventional wisdom today, espoused by A.J.P. Taylor among others, is that the Hapsburg Empire, founded as it was on the dynastic principle, could not long survive an age of nationalism. Interestingly enough, comparatively few of the counterfactuals seem to be founded on an attempt to refute this argument outright. Nonetheless, there seem to have been at least three broad points of divergence which could have established the conditions for this to happen later on.
The first is in the sixteenth century. Had the centralizing efforts of the Hapbsurgs been more successful in Germany during the sixteenth century (perhaps facilitated by a decisive defeat of the Protestant princes), the Hapsburg Empire might later have included much more German territory. This would have strengthened the empire in any number of ways, some immediate, such as a broader resource base, and the reduced ability of neighboring France to manipulate the politics of a fragmented Germany to its own ends. Others might have been more significant later, such as the elimination of the challenge that came from Prussia from the eighteenth century on. Had the coal and iron of the Ruhr Valley been included in the Hapsburg domains, the Austrian empire would have had the material foundation for the industrial superpower that it never became in our timeline (which was the real reason why it ceased to be a great power). Additionally, a larger share of the population identifying as German might have had a politically stabilizing effect on the empire by diminishing the potential of German nationalism to fracture the empire (something helped along by the absence of a large, dynamic German national state on the other side of the border), and diluting the political power of other groups.4
The second point is at the start of the eighteenth century. Austria's absorption in the War of the Spanish Succession enabled the Hungarians to seize and retain autonomy within the empire, which laid the groundwork for the Dual Monarchy of 1867. Had that not been the case (for instance, if the war was concluded at an earlier date), administration might have been greatly simplified, while diminishing Hungarian conflicts with other groups, and doing away with this precedent. Indeed, Sked suggests that without this great obstacle to necessary internal reforms, and the anti-Russian influence of the Hungarians on Austria's foreign policy (a contributor to World War I), the empire might have been able to stave off disaster.5 Even if his claim overstates the case, a simpler internal structure would still have made the empire more manageable, while perhaps clearing the way for a more vigorous foreign policy in Germany and elsewhere.
Even later on in the timeline is the matter of Chancellor Prince Klemens Wenzel von Metternich's policies following the Congress of Vienna--the only one of these three which has enjoyed much attention from counterfactual-minded historians of the subject.6 The post-Napoleonic diplomatic arrangements left Austria theoretically dominant in western Germany and Italy, though particularly in Germany, Austria behaved passively, leaving the way open for Prussia (actually the weaker power at the time) to assume the leading role--and ultimately, unify Germany under its headship rather than Austria's. Internally, Metternich notoriously used nationalism to counter the spread of liberalism, and then played off the then-emerging nationalities against one another, particularly the nationalism of the empire's Germans. As Taylor put it, "manufactured traditions were the ruin of Austria, and Metternich was the founder of this trade."7 More far-sighted policies might have contained rather than exacerbated the nationalities question, while improving Austria's position in western Germany.
With the empire more coherent and better equipped materially, particularly from one of the earlier points of divergence on, it would also have been better at containing or slowing the spread of the liberalism and nationalism spread by the French Revolution.8 Moreover, Austrian cosmopolitanism held out a fascinating possibility--the foundation of an earlier version of the European Union. Of course, other European states might have perceived such a mission as threatening, particularly Czarist Russia and Great Britain, which would likely have remained great powers in this timeline, and France (republican or otherwise), which might have been reduced in standing, but still a factor. Indeed, a countervailing alliance, as occurred in our own timeline, would have been likely. Still, a conservative union of some kind appealed to monarchists, aristocrats and the elites siding with them as the history of post-Napoleonic Europe demonstrated, and the idea was not entirely dead in the early twentieth century.9 Especially if Austria married this idea to German industrial power (which had no real peer apart from the United States by the early twentieth century), the Hapsburg Empire would have been the logical leader.10
Nonetheless, the appeal of such a union should not be overestimated, and with important states remaining outside its domain, the familiar round of balance-of-power wars may have happened anyway in some form, though it should not be assumed these would have succeeded in checking it. (Ancient China, after all, had a balance of power system too--until one state conquered all the rest.) Particularly should Austria have captured France's industrial heartland in the northeast of the country during the fighting--as Germany actually did during World War I--the reduction of France to an Austrian vassal state is conceivable. Voluntary unions would also have been plausible, not least of all because some reactionaries would have preferred a foreign king to domestic democrats or socialists.11 The result would have been an empire extending from the Atlantic to the borders of a Russia which would have had to come to terms with it in the Balkans, the Near East and elsewhere, while Britain either made accommodation on its own, or turned away from the continent, toward its former and present colonies.
Of course, from today's standpoint the notion of even a partial twentieth century European Union under the headship of a royal family seems preposterous. However, as the twentieth century demonstrated, liberalism and socialism only slowly became the dominant forces on the continent. Additionally, after World War I, European nations proved to be quite capable of backsliding toward dictatorships, and even today many European countries still have royalty, even if they function only as figureheads. Indeed, there is some evidence that monarchism, if anything, is making a major comeback, with "a political alliance of church and state . . . resurrecting disestablished monarchies from Italy to the Balkans."12 To those actually inhabiting the slightly tweaked timeline described here, nothing might seem more natural than a common European home under its most historic dynasty.
1 Alan Sked, The Decline and Fall of the Hapsburg Empire 1815-1918 (New York: Longman, 1989), pp. 3-6. 2 Taylor discusses a scenario in which the Hapsburgs save the empire by negotiating with Russia following the German victory at Tannenberg, which just saved Hungary from a Russian invasion. See A.J.P. Taylor, The Hapsburg Monarchy, 1809-1918: A History of the Austrian Empire and Austria-Hungary (Chicago: University of Chicago Press, 1976), p. 233. 3 Sked, pp. 2-7. 4 As of 1910, German Austrians formed less than a quarter of the population--a figure roughly equal to the percentage of Americans who could trace their history to Germany. 5 Sked, p. 261. 6 Sked makes the case against this conventional wisdom about Metternich. See Sked, pp. 8-40. 7 Taylor, p. 42. 8 It should also be remembered that many of the nationalisms of the empire were not intractable. Until fairly late, national consciousness was comparatively frail, and relatively few groups actually wanted to dismantle the empire--in part because of the difficulty of developing viable successor states, as the artificiality of Czechoslovakia and Yugoslavia (today gone the way of "Austria"), demonstrates. 9 Austria's Foreign Minister Count Alois Lexa von Aehrenthal held out hope of resurrecting the old Holy Alliance in the years preceding World War I. 10 One factor that might have simplified this would have been the retention of Spain within the Hapsburg dynasty--ended by the political will of King Charles II, which triggered the aforementioned War of the Spanish Succession. 11 This may have been particularly likely in weak, fragmented Italy or reactionary Iberia, particularly with France neutralized. 12 Kevin Phillips, American Dynasty: Aristocracy, Fortune, and the Politics of Deceit in the House of Bush (New York: Viking, 2004), pp. 51-52.