In 1749 the final peace with Prussia was one year old, and Maria Theresa had still not reconciled herself to the loss of Silesia. Her gloom was somewhat relieved and her hope revived when the man who had argued the Habsburg case at peace talks in Aachen, Count Wenzel Anton Kaunitz-Rietber, was first introduced to her. Kaunitz presented to the queen his foreign policy assessment, arguing that the Turkish threat had largely passed and Bourbon hostility too was abating; the only dangerous enemy of Austria was Prussia. The chief goal of the empire’s foreign policy therefore had to be to undermine Prussia’s position. That could best be achieved if Austria managed to range her traditional enemy, France, to her side. Once that was accomplished, a number of other states that had fought against Austria in the previous war would follow France’s lead. The queen, partly under the influence of her husband, whose home province, Lorraine, had been a pawn in so many of France’s skirmishes with the Holy Roman Emperor, at first treated the idea with skepticism; she nevertheless appointed Kaunitz ambassador to Paris and allowed him wide latitude in pursuing his plan. During his assignment Kaunitz never really passed beyond sounding out several of the king’s favorites, male and female; however, upon his appointment to state chancellor (foreign minister) in 1753, he gave his successor in Paris, Starhemberg, instructions to further promote his own initiatives. His main argument was that France’s alliance with Prussia, concluded in the first year of the War of the Austrian Succession, was insincere because Frederick II was at the same time actively seeking an alignment with France’s arch enemy, England. Proof of this came in January 1756, when England and Prussia agreed on mutually advantageous terms should they fight as allies in a new war. When Starhemberg saw to it that the news was conveyed to Versailles, it at last persuaded the French to switch alliances. Since Austro-French antagonism over Italian possessions had been largely resolved, the decision was easier to take. On May 1, 1756, the two countries signed at Versailles a preliminary agreement, and in August the specifics were worked out: in case of an Austrian war against Prussia, France would provide mercenaries, would not object to the drastic truncation of Prussia, and would receive territorial rewards in Italy or the Netherlands. Meanwhile, Kaunitz ensured Russian cooperation: the czarina Elizabeth nursed as deep an antipathy for Frederick II as did Maria Theresa. All was ready for a war of revanche.

Prussia was actually the first state to assume belligerency as Frederick sought to overcome material odds by taking quick and forceful action. Soon all the states that had undertaken obligations were involved in battle. The Prussian king faced a formidable coalition in what against all expectations became a seven-year-long conflict; with sheer persistence, astounding military skills, and some good luck, he avoided the worst. He was able to extricate his armies from the most perilous situations. Once, for a three-day period, even his capital Berlin was occupied by Russian armies, but they could not maintain themselves in the face of Prussian counterattacks. The decisive stroke of good luck came with the death of Elizabeth of Russia on December 25, 1761. Her successor, Peter III, a German by birth and an admirer of Frederick II, had neither the stomach nor the inclination to continue the struggle. By the time he had with- drawn his troops from battle, a palace revolution unconnected with the shameful change of sides had overthrown him, but Catherine II, his wife who succeeded him on the throne, was herself German and had no more enthusiasm than Peter had for the war against Prussia. Throughout the conflict England and France fought on opposite sides, mainly in America, and, as in the first Silesian war, the original cause was nearly lost from sight. In November 1762 England and France concluded a preliminary peace, which they finalized the following February in Paris. By now Maria Theresa realized that the recovery of Silesia was no longer a viable project and, on February 15, she made peace with Frederick at Hubertusburg, with all territorial arrangements returning to the status quo ante.

Internal reforms had continued even during the war under the guiding concept of centralization, ending what the queen regarded as the ruinous fragmentation of her realms. In the Austrian and Bohemian lands, largely through the creation of the Staatsrat, a six-member council of state, of which three members came from the ranks of the high aristocracy and the other three from the lesser nobility, this goal was at least superficially accomplished. However, Hungary once again proved intractable, even though it benefited most from Maria Theresa’s efforts to settle the areas that the long Turkish occupation had left depopulated. Food production had fallen sharply and the sparse population provided consistently low tax revenues. Already Maria Theresa’s father had begun a program inviting foreigners into the country to establish themselves, mainly in the regions east of the Tisza River and in the broad strip of land between the Tisza and the Danube. Here Hungary possessed some of the richest agricultural land anywhere in Europe, but methods of production practiced by the indigenous population were still primitive and the yield was well below that derived from soil of the same quality in western Europe; many of the newcomers brought modern agrarian skills, as well as manufacturing expertise, with them. The queen’s consort, Francis, showed particular interest in industrial enterprise and his investments proved most felicitous. They were by no means limited to Hungary and by the end of Maria Theresa’s reign in the suburbs of Vienna alone 75 manufacturing concerns were active. The greatest industrial growth occurred in Bohemia, where the loss of Silesia created new opportunities for start-ups and where the necessary raw materials were present in adequate quantities.

The paucity of international commerce had long constituted the great weakness of the Austrian economy. A number of treaties for exchange of goods had been concluded with the Ottoman Empire, but they resulted in a continuously negative trade balance. Maria Theresa ordered that Turkish merchants doing business in her empire had to settle permanently and be subject to its taxation and laws. The upswing in the Austrian economy after the Seven Years’ War, however, had much broader and more complex causes. There was an increased market for a variety of goods and a more sophisticated monetary policy facilitated their exchange. In 1769 the Vienna stock market opened (there already was one in Trieste), and in 1771 paper money supplemented the silver thalers that acquired a solid reputation in European money markets. Growing prosperity was not equally evident in all provinces of the empire, but the general indicators pointed upward.

Although the queen’s concern with the welfare of her subjects was spotty and inconstant, she undeniably felt a religious obligation to protect those who could not fend for themselves, and among these the peasants were in greatest need of royal attention. The core of their problem was that their holdings were not clearly defined in extent and they could never regard the land they worked as their own; their obligations to the landlord were also ill-defined, leading to endless disputes. The queen issued a series of urbariums, first in Croatia and then in other provinces, regulating the relationship between landlord and peas- ant and firmly separating the former’s landholding from the latter’s. The system had a negative aspect, too; as the peasant family grew, its landholding did not. However, knowing the land was permanently his inspired the peasant to cul- tivate it with much greater care. Production increased, as did the taxes paid, and peasant boys inducted into the army were consequently better fed, stronger, and healthier.

This last consideration was of particular importance because an empire located in so many areas of Europe always faced the possibility of war. Alliances were shifting, and there was no overriding issue, no ideological bond, that tied Austria to any of the powers, every new crisis necessitated an opportunistic alignment of forces. This became amply evident when the question of Polish succession, temporarily solved by the war of 1733, which had placed the Saxon Augustus III on the Polish throne with Russian-Austrian backing, still left open the question of who had legitimate claim to that throne. The result was a weakness of royal power which could not stand up to noble pretensions; this in turn fatally undermined the power position of Poland itself.

Augustus III died in 1763. He had spent little time in Poland and in any case would have been powerless to counteract growing Russian influence there. Maria Theresa would have preferred the continuation of the Saxon line, but Catherine II of Russia promoted her favorite, Stanislaus Poniatowski, and by now there was little that other powers could do to limit Russia’s dominant influence in Poland. In 1764 Stanislaus was duly elected. By then religious questions with ulterior political motives complicated the picture. Poland was a Catholic country with small Protestant and Greek Orthodox minorities. Catherine and Frederick II of Prussia, having their eyes on Polish lands adjoining their own, decided to demand equal rights with Catholics for the two minorities. Expectably, this raised a storm of protest in Poland and an association, the Confederation of Bar, was formed, determined to lessen or exclude Russian influence. The resulting civil war of extraordinary ferocity practically invited foreign intervention. The first intervention occurred on the part of Turkey, which, encouraged by France, declared war on Russia, ostensibly in defense of “Polish liberties” but really because of Russian incursions into her Moldavian provinces in pursuit of Polish insurrectionists who had fled there. In the war the Russians earned several victories, causing acute concern in Austria that Russia rather than Turkey was the main menace to the Habsburgs’ Balkan position. For his part, Frederick II of Prussia perceived the opportunity to preserve the balance among the powers at Poland’s expense. He proposed a partition of Polish lands. An agreement to this effect was worked out by Austria, Prussia, and Russia on August 5, 1772. Russia received White Russia to the Dvina and Dnieper Rivers with 1.8 million inhabitants, Austria got Galicia and western Posolia, with 2.7 million people, and Prussia the land separating Brandenburg from East Prussia, with 416,000 inhabitants. In the closing years of her reign Maria Theresa had the satisfaction of seeing her empire, which had been diminished by the loss of Silesia, enlarged by extensive Polish territories. Nor was this the only accretion of land. Although the queen had resisted the arguments of her son Joseph and her chancellor Kaunitz, who had urged her to enter the war Russia fought against Turkey, she took advantage of the loss of Turkish control over Moldavia when that war ended in 1774, and in 1775 made a deal with the prince of that province for the cession of one part of it, Bukovina. Thus a new province was added to the Danubian monarchy.

Two years before her death Maria Theresa faced another war scare; her restless son and designated successor, Joseph, Holy Roman Emperor since his father’s death in 1765, wished to realize an old ambition: he proposed that the Austrian Netherlands be joined to Bavaria, and these united provinces be added to the Habsburg Empire. The opportunity came with the death of the Bavarian elector in 1778. Joseph was ready to risk war over the issue, because he knew that Frederick of Prussia would never consent to such an augmentation of Habsburg power. Maria Theresa, no longer confident of decisive influence over her son, turned directly to Frederick to prevent the emerging conflict. She was able to conclude, with French and Russian mediation, the Peace of Teschen, which left Bavaria in its current position, with a small border region going to Austria.

Maria Theresa died on November 29, 1790. She left a legacy of political realism and secured a hitherto unaccomplished unity for her multinational realm. While by no means a champion of the Enlightenment, which was suspect in her eyes because of its pronounced antireligious bias, many of her policies reflected a shrewd understanding of the fact that medieval notions of social relations and principles of governance had seen their day and, even in religious matters, had to be modernized. Under her rule, politics in the empire became truly the art of the possible; even though she introduced many startling innovations, she did not find herself forced to retract any of them. Although she marched in step with the progress of history, she had reason to fear in her last years that the virtue of restraint would cease when her son and successor, Joseph II, took the throne.