which form the later deficits were converted. The debt of the whole empire and of the Austrian monarchy, on the 1st of July, 1882, was 3,280,055,699 florins, of which the consolidated debt, bearing interest, represents 3,038,116,776 florins; non-interest-bearing, 115,756,604 florins; floating liabilities, 112,183,618 florins; and annuities, 13,998,701 florins. The total annual charge of the Austrian and common debts amounted in 1882 to 158,365,020 florins, of which the share borne by Hungary was 30,317,753 florins.

An operation for the conversion of the Hungarian debt was begun in 1881, in which year 160,000,000 florins of 6 per cent. gold bonds were redeemed by the issue of a 4 per cent. loan which was taken at a fixed price of 77. The operation was suspended on account of the monetary crisis, and resumed again in 1883, when 300,000,000 florins were converted on slightly less favorable terms than before.

Tariff. By agreement between the Austrian and Hungarian governments an increase in the tariff on petroleum, coffee, and tea was adopted as a means of reducing the chronic deficits in both countries. These enhanced duties, which fall with excessive severity on the laboring classes, went into operation in 1882. The import duty on petroleum was increased from 3 to 10 florins per metric quintal. In addition to this an excise duty on refined petroleum of 6 florins per 100 kilos was imposed by the Hungarian Government. The increased revenue in both halves of the empire from the new petroleum duty is calculated at 6,000,000 florins. The duty on coffee is increased from 24 to 40 florins per metric quintal, and on tea from 50 to 100 florins, from which changes an increased yield of 6,500,000 florins is expected.

Taxes.-A bill for the amendment of the income-tax, carried through by the Austrian Government, forms part of a plan for the reform of the whole system of direct taxation. The revision of the land and house taxes had already been accomplished. The new income-taxes are much simpler than the former system, which even the officials had difficulty in understanding in all its details. A progressive scale is established for incomes derived from trades and professions. Besides the other taxes on special kinds of income, every one receiving more than 700 florins a year of net income pays a personal income-tax calculated on a progressive scale. The changes are expected to augment the revenues, which the chronic deficits in the budget render necessary in Austria as well as in Hungary. In both halves of the empire the indirect taxes, consisting of stamps, fees, and imposts on articles of consumption, have been pushed to the extreme limit, with the exception, perhaps, of the sugar and spirit taxes. The income-tax in Hungary is higher than in almost any other country, being 12 per cent. on incomes from stocks and bonds.* The revision of the

It is exceeded only in Italy, where incomes from funded securities pay 13 S per cent.

Austrian system of taxes, the fourth within eighteen years, turns to this source which is already so fully utilized in the sister kingdom. The new land-tax is apportioned among the different provinces, and is assessed at 37,500,000 florins for fifteen years from 1881. The new personal income-tax is intended to replace all other methods of extraordinary or supplementary taxation. The rate is variable, and is fixed in the budget annually, according to the requirements of the Government. Incomes from enterprises which are required to furnish an official exhibit of their finances, and which are taxed at their source, are not subject to the personal income-tax. This variable extraordinary tax is supplementary to the scheme of the ordinary direct taxes, which covers systematically the five classes of objects approved by modern national economists, viz., land, houses, income from investments, trades, and salaries. The land-taxes are copied after the Prussian system. The cadastral survey and valuation, begun in 1869, was completed in 1881, at a cost of 20,000,000 florins. The yield of the land-tax is not greater than before. The housetax is assessed on town property according to its renting value, and upon rural dwellings according to the number of rooms they contain. Mud and thatch cabins pay 75 kreutzers (37 cents), houses with a single room 1 florin 50 kreutzers (75 cents), with two rooms 1 florin 70 kreutzers, up to villas and castles with forty rooms, which pay 220 florins ($110) per annum, and 5 florins more for each additional room. This class-tax on dwellings is higher, and the progression somewhat steeper than under the old law. The new income-tax affects all incomes from invested capital which are not taxed under other heads, or expressly exempted from taxation by special laws, as are the interest on deposits in the postal savings-banks, and the revenues of charitable institutions, of public schools, and incomes not exceeding 300 florins. The law requires every one to give any desired information respecting his own income or that of another. The tax is 5 per cent., except on dividends derived from corporations, which pay 10 per cent. Industrial and commercial concerns are taxed according to their mean profits, beginning with 3 per cent. on 1,500 florins, and ascending to 10 per cent. on over 50,000 florins annual profit. The tax on earnings does not touch incomes below 300 florins. Up to 500 florins the rate is 0.2 per cent., ascending to 10 per cent. for salaries or professional earnings exceeding 5,000 florins.

Army and Navy.-The total war strength of the Austro-Hungarian army in the beginning of 1883 was about 1,250,000 men, including 245,000 Austrian Landwehr and 205,000 Hungarian Honveds. The standing army is under the control of the common Minister of War, while the militia is looked after by the Ministers of National Defense in the two kingdoms. The system of army organization agreed to by the two states and embodied in the law

of Dec. 5, 1868, is that of universal liability to arms, on the model of the German army. The term of service is three years in the standing army and seven years in the reserve, with a liability to serve two years more in the Landwehr. The reorganization of the army, begun in 1883, introduces the territorial system, dividing the empire into fifteen corps d'armée districts, subdivided into recruiting precincts. The 102 regiments of infantry, of four battalions, will each be stationed in the district from which it is recruited. The standing army numbered in the beginning of 1882 251,455 men on the peace footing and 779,597 including the reserves. The active army was made up as follows: infantry, 144,738 men; yagers, 16,136; cavalry, 42,271; field-artillery, 20,223; fortress artillery, 7,110; engineers, 5,296; pioneers, 2,672; staff and departmental services, 13,009; total, 251,455.

The Austro-Hungarian navy consisted, in 1882, of 13 iron-clad war-vessels, 37 steamers, chiefly small and constructed for coast-defense, 6 sailing-vessels, and 12 torpedo-boats. Of the armored vessels, ten are sea-going cruisers. The largest is the Custozza, a broadside ship of 7,060 tons, covered with 91-inch plates, and armed with eight 18-ton Krupp guns. Of more modern type is the Tegethoff, of 7,390 tons, armored with steel 13 inches thick, with six 25-ton Krupp guns ranged broadside and in a turret. The Erzherzog Albrecht has 8 inch plates and eight 18-ton Krupp guns. The navy was manned in July, 1882, by 6,270 officers and men, who can be doubled in the event of war. The navy is recruited by a levy on the seafaring population, subject to the same term of service as in the army, supplemented by enlistments. Austria has a strongly fortified naval harbor at Pola, which has been enlarged so as to be enabled to contain the entire fleet, and another naval port at Trieste, where the arsenals are situated.

Foreign Relations.-The situation of AustriaHungary in its relations to foreign powers and the peace of Europe, though more difficult than that of any other country, is becoming more secure through the strengthening of the league of peace of which the German Chancellor is the author. The dangerous feelings which were rife in both Russia and Italy in the preceding year were less noticeable in 1883. The bond between the Governments of Austria and Italy seems to grow more acceptable to the Italian people, although a large section do not yet give up the idea that there are still scores to settle with their old enemy. The Irredentist demonstrations continued in the early part of the year, but subsided later. The Russian strategic railroads and rumored massing of troops on the frontier created great alarm in the beginning of the year, but the visit of the Russian minister, M. de Giers, at Vienna, and the manifestations of pacific intentions for the present on the part of the Czar tranquillized this feeling. The source of the danger, however, the situa

tion of the south Slav peoples, became still more evident in 1883. The King of Servia, by becoming the protégé of Austria, effectually alienated his subjects, who after his return from a visit to Vienna, in August, broke out in open revolution. The pretender, Karageorgevich, fortified by Russian support and a matrimonial alliance with the Prince of Montenegro, hovered on the borders, ready to seize the throne. The occupied provinces remained tranquil during the year. The refugees nearly all returned from Montenegro. In the autumn the recruiting proceeded without objection. The difficulties with the Roumanian Government were not decided at the Danubian conference in a manner satisfactory to Roumania, but negotiations begun at Vienna with M. Bratiano in the fall promise to remove some of the causes of jealousy. (See DANUBE, EUROPEAN COMMISSION OF THE.) The Roumanian Minister apologized for his hostile declarations of the preceding year. A boundary commission began the adjustment of certain disputed points of the frontier line between Hungary and Roumania. One of the occasional quarrels between the frontier guards on both sides of the line created a sensation in October, until it was known that the participants were alone responsible. The Hungarian Government was intrusted with the duty of removing the obstacles to navigation at the Iron Gate in the Danube.

Still more important to Austria than the arrangement of the affairs of the Danube, was the decision arrived at by the Conférence à quatre and arranged with the Turkish Government regarding the speedy completion of the Turkish lines of railroad to connect with the Austro-Hungarian system.

The Danube and Turkish Railways. — In the eighteenth century, and down to the middle of the nineteenth, Austria enjoyed a commercial primacy in Turkey which was originally won by her successful wars against the Ottomans, and which her geographical position enabled her to maintain. The political ascendency in the lands of the divided Ottoman Empire has since been borne away by Russia and the Western powers, and in the commercial arrangements subsequently entered into Austria has seen her geographical advantages neutralized and the trade pass into the hands of the more enterprising merchants of England, France, and Belgium. This Levantine trade is, however, of vital importance to Austria and Hungary, unfavorably situated as they are with regard to the ocean commerce. By the Paris Treaty of 1856, Austria was compelled to share the control over the navigation of the Danube with France, Great Britain, the German states, Russia, Italy, and Turkey. The acte public of 1865 took away the remaining privileges which the Commission of Riverain States secured to Austria, and the Pontus conference of 1871 confirmed the prolongation of the European commission till April 24, 1883. The Treaty of Berlin in 1878 extended the jurisdic

tion of the commission up to the Iron Gate, gave Roumania a voice which it has used against Austria, and delivered over to Russia, with the Kilia arm and the Stari-Stamboul mouth, the possible military command of the mouth of the Danube and control of its commerce. The deepening of the mouth of the Danube by the European commission was in reality detrimental to Austrian commercial interests. The stoppage of navigation during the winter months, the shoal and shifting channel in the wide stretch between Pressburg and Gönyö, and the rapids of the Iron Gate, deprive the Danube of value as an outlet for Austrian commerce. Before the improvement of the mouth, Austrian merchants monopolized the markets of the lower valley. Since British and French vessels are enabled to ascend the river, the Austrians have been driven step by step from this profitable field. In the seatraffic Austria has lost ground in the same proportion. The overland exports to Turkey, including Servia and Roumania, increased only 16,000,000 florins in the sixteen years from 1864 to 1880. Of the imports of all Turkish ports in the ten years ending with 1872, England furnished 48 per cent., France 15 per cent., Germany 7 per cent., and Austria not 7 per cent. In the ten years between 1867 and 1877 the trade with Turkey showed a rapid decline. In the former year 13.3 per cent. of the import, and 22.1 per cent. of the export trade of the Austrian Empire was with Turkey; but in 1876 the proportions were 116 and 18 per cent. respectively, while the transit trade declined 30 per cent. The Austrian tonnage on the lower Danube declined from 86,000 in 1879 to 50,000 in 1881, while the British increased from 136,000 to 332,000. Of the tonnage which passed through the Sulina mouth in 1872, 30 per cent. was British and 11 per cent. Austrian; while in 1881, 63 per cent. was British and 6 per cent. Austrian.

The long-projected railroad connection with Turkey was expected to give Austria the opportunity to regain the position which was lost through the errors of her diplomatists and the incapacity of her merchants. In 1869, Baron Hirsch, the famous Austrian railroad financier, undertook to construct for the Turkish Government a line of railroad which should extend through the length of Turkey and connect under the most favorable conditions with the Austrian net-work. The concessions provided for a railroad from Constantinople via Adrianople and Philippopolis, through Bosnia to the Save, where it would connect with the Southern railroad of Austria. Branch roads were to connect the trunk-line with Salonica, Dedeagatch, and Shumla. The Constantinople end was built to beyond Philippopolis, the Salonica branch constructed, and the Novi-Banjaluka section finished, by 1872. A convention was concluded for the continnation of the east end from Bellova to Sophia and Nish, and the extension of the Salonica

branch from Uskub to meet the Bulgarian section at Mitrovitza, which it was intended to continue from Nish by way of Mitrovitza, Novi-Bazar, Serajevo, Travnik, Banjaluka, and Novi, to join the Austrian railroad at Agram. Baron Hirsch finished the Salonica road up to Mitrovitza, and constructed the Bulgarian branch to Tirnova. British intrigues and the rival interests of the Austrian and Hungarian states prevented the work from being carried any farther. The portions thus far completed opened up the whole interior of the Balkan Peninsula to British commerce, while AustriaHungary derived no benefit from them. When. the Porte showed an inclination to complete the connection with the Austrian railroads, it was persuaded to divert the line for supposed strategical reasons, and adopt the project of a difficult mountain railway from Sophia to Uskub. The Hungarians were strongly opposed to the Hirsch project, desiring that the connection with the Continental system should be through Hungary, and the Government went so far as to make surveys for a direct line from Pesth through Semlin and Belgrade to Nish. The territorial changes consequent upon the Russo-Turkish War increased the divided interests and strategical questions. The Berlin Congress, instead of deciding the question of the railroads, left it in an almost hopeless tangle by referring it to the Conférence à quatre, making it depend upon the mutual agreement of Austria - Hungary, the Porte, Servia, and Bulgaria. The AustroServian railroad convention was concluded as early as April 9, 1880. In this, Servia bound itself to construct within three years a railroad connecting with the Pesth-Semlin line and running from the Hungarian boundary near Belgrade up the Marava valley to Nish, and there dividing so as to connect with the Turkish railroads by two branches, one running to the Bulgarian boundary toward Bellova, where it would join the Constantinople line, and the other to the Turkish boundary to meet an extension of the Salonica-Mitrovitza railroad. The work was not completed at the term agreed upon, June 3, 1883, nor is it yet decided where the junctions with the Turkish and Bulgarian railroads are to be. The Conférence à quatre, at its sittings in 1881 and 1882, debated fruitlessly the questions of the international postal and telegraph services, tariff regulations, etc. A note communicated to the Turkish Government by the Austrian embassador in the early part of 1883, complains of the delay in carrying out the decisions of the Conférence à quatre, and making the extensions to connect with the Servian and Bulgarian roads. It declared that the Porte had not yet determined the route by which the Yamboli line was to reach the Bulgarian railroad at Shumla, and neither accepted nor rejected the Servian proposal of the Vranja route for the connection of the Salonica-Uskub road with the Servian system. The

alternative is the Pristina route, by which the continuation already constructed to Mitrovitza would be utilized. The Austrians were desirous that the connection with the Salonica road should be taken in hand first, instead of the extension of the Yamboli branch into Bulgaria, which latter would serve Roumanian and Russian interests and promote British rather than Austrian commerce. The passage of the railroads through Hungary, Servia, and Bulgaria, instead of directly from Austria proper into Turkey, deprived them of many of the expected advantages to Austrian commerce and industry, while favoring the rival Hungarian interests. The protracted discussions of the Conference à quatre led at last to the adoption of a railroad convention which was signed May 9, 1883. The route agreed upon for the line which will connect Vienna with Constantinople, passes through Semlin, Belgrade, Nish, Pirot, Caribrod, Sophia, Bakerel, and Bellova, to Sarembey, the present terminus of the railroad from Constantinople. The road from Salonica is to join the Servian railroad from Belgrade to Vranja, by means of a railroad to be constructed from the latter place to a point on the Salonica railroad in the neighborhood of Pristina, or wherever the surveys indicate the most favorable route, the point of junction to be settled upon by the Porte within a year. The 15th of October, 1886, is set as the term at which both lines must be completed. The gauge is to be the same as that of the Austrian railroads, the signal system and other modes of operation are to follow those of Austria, and in the customs arrangements every facility is given to commerce and travel. The tariffs per kilometre are to be identical in the countries through which the roads pass. At least one express daily is to run in each direction between Vienna and Pesth and Constantinople, and Vienna and Pesth and Salonica, at a speed of at least 35 kilometres (22 miles) an hour.

Austria.—Austria proper, or Cisleithania, has been governed since the recognition of Hungarian independence by a twofold Legislature, a central body, called the Reichsrath, and local assemblies, or Provincial Diets, for the individual provinces. The Reichsrath consists of an upper house, or House of Lords, and a lower house, or House of Deputies. The House of Lords is composed of the princes of the blood royal, 14 in number in 1882; the territorial nobility, numbering 53; the archbishops (10) and bishops of princely rank (7); and lifemembers appointed by the Emperor for distinguished merit and ability, in number 105. The Abgeordnetenhaus, or House of Deputies, consists, under the electoral law of 1873, of 353 members elected by four different constituencies: 1, the people of the rural districts; 2, the people of the towns; 3, the chambers of commerce in the large towns; 4, the large landed proprietors. The franchise in the popular urban constituencies was extended by a

law enacted in 1882 to all male persons paying five florins in direct taxes. The Provincial Diets are composed as follows: 1, the archbishops and bishops of the Roman Catholic and Oriental Greek Churches and the chancellors of the universities; 2, representatives of the landed aristocracy, elected by all proprietors paying taxes to the amount of 100 florins; 3, representatives of towns, elected by all the burgesses; 4, representatives of chambers of commerce and trade-guilds; 5, representatives of rural communes elected indirectly through electoral colleges. The provinces are seventeen in number: Lower Austria, Upper Austria, Salzburg, Styria, Tyrol, Vorarlberg, Bohemia, Dalmatia, Galicia, Carinthia, Carniola, Bukovina, Moravia, Silesia, Gorizia, Istria, and Trieste.

The Reichsrath has power to legislate on matters of customs, trade and commerce, banking, posts, telegraphs, and railroads, subject to royal approval, to scrutinize the public accounts and discuss all bills of taxation and expenditure, and to ratify all legislation relating to military service. Members of both houses have the right of initiative. The presiding officers in both bodies are nominated by the Emperor. The Reichsrath must be convened annually, and, in case of dissolution, new elections must take place within six months. The Provincial Diets legislate on matters of local administration and taxation, particularly agrarian regulations, public works, the church, schools, and public charity.

The Cabinet is composed as follows: President of the Council and Minister of the Interior, Count Eduard Taafe, born in 1833, who held the same portfolio in a former ministry, 1867-'70, and was appointed chief of the present Cabinet Aug. 19, 1879; Minister of Public Instruction and Ecclesiastical Affairs, Baron S. Conrad D'Eybesfeld, appointed Feb. 17, 1880; Minister of Finance, Dr. J. Dunajewski, appointed June 26, 1880; Minister of Agriculture, Count Julius Falkenhayn, appointed Aug. 19, 1879; Minister of Commerce and National Economy, Baron F. Pino von Friedenthal, appointed Jan. 14, 1881; Minister of National Defense, Maj.-Gen. Count S. von Welsersheimb, appointed June 25, 1880; Minister of Justice, A. Prazak, appointed Jan. 14, 1881; Minister without Portfolio, F. Ziemialkowski, appointed Aug. 12, 1879.

Pro

Political Chronicle.-The Czechs, whose position was strengthened by the Bohemian elections of 1883, continued to press their victory over the German party, which showed a still more bitter and irreconcilable spirit. vision was made for the establishment of a Czechish medical faculty in the University of Prague. Although the Czechs and Slovenes elected representatives to the Reichsrath who for four years have dictated radical changes in the laws of the empire for the benefit of their races, yet the provincial legislation has remained in the hands of the old German

majority. Finally, the ministry gave heed to the frequent memorials from Bohemia and Carniola, and ordered new elections for the Diets of those provinces, in which an overwhelming majority of Autonomistic candidates were returned. In Galicia the Ruthenians have the same complaints to make against the Poles which the latter and the other Slavs formerly made against the Germans. To them alone of all the Slav races the triumph of the federalistic principle signifies the extirpation of their national characteristics. They are about equal in number with the Poles, but form the poorer and politically weaker class. They formerly voted with the German Centralistic party, and looked to it for protection, but, losing hope of relief from that quarter, are gradually abandoning their opposition, relying on the hope that the combination of parties which has saved from extinction all the other nationalities will not be so inconsistent as to help crush out theirs. In the elections of 1883 the Polish Federalistic party carried everything before them. A sign that the Germans will soon abandon their efforts to recover the dominant position which enabled them to impose German civilization upon the unwilling Slavs by political means, is seen in the growth of a German national spirit manifested in demands for the autonomy of the German communities of Austria which are in danger of being ingulfed in the "Slavic deluge." Many of the Jews in Austria, who formerly counted themselves as Germans, have turned with the popular current, and adopted other nationalities. The Germans also begin to show the same facility as in other countries to merge their nationality, now that it secures them no advantage, in that of alien races.

As the Saxons of Transylvania complain of Magyar oppression, the German party in Bohemia anticipate similar grievances, and have broached the subject of the division of the province into separate German and Czechish administrative districts. These incidents of the race struggle are but superficial manifestations. The preponderance of German thought and the spread of German influence through commercial, political, and intellectual channels still continues in Austrian lands and extends through southeastern Europe, although Magyar and Slav politicians attempt to revive the influence of French ideas, and during the year gave expression to this sentiment in frequent newspaper articles and a number of political manifestoes. The combination of Czechs, Poles, and Conservatives, which has carried through the federalistic policy, obtained in 1883 for the first time a majority in the Austrian Delegation, which, according to the usual custom, is not elected by the whole House, but by the deputations of the several provinces, to each of which a certain number of seats in the Delegation are allotted.

Socialism.-Austria has hitherto prided itself on its freedom from socialistic agitation. But

for a year or two past it has seen evidences of a wide-spread socialistic propaganda, and has been startled by eccentric crimes committed by revolutionary desperadoes, by riotous demonstrations in the streets of Vienna, and by murderous encounters between the police and socialists. In November, 1882, the breaking up by the police of a shoemakers' trades-union was the occasion of a riot in Vienna, in which the cavalry were called out, and charged on the mob. The following month there was a monster trial of socialists in Prague, which resulted in the conviction of forty-five persons. Another band, twenty-nine in number, were brought to trial at Vienna in March, 1883. To some of these a singular crime was brought home. They had murdered and robbed a shoemaker in July, 1882, in order to obtain money to spread the inflammatory teachings of Johann Most's "Freiheit." All the prisoners except the two implicated in the crime were acquitted, because there is no law against socialism in Austria, and convictions can only be pronounced for high treason or disturbance of the public peace. A general strike of the bakers in Vienna caused some excitement and much inconvenience, until the Government came to the relief of the public and crushed the strike by supplying the city with bread made by the army bakers. On December 15th a commissary of police who had attended socialistic gatherings, in conformity with a law requiring all meetings, however private, to be held under police supervision, was murdered in a suburb of Vienna.

The socialistic ferment, which has penetrated into Austria, has stimulated politicians to propose remedial measures. The Government introduced into the Reichsrath, in the session which opened Dec. 5, 1882, a trade-regulation act, an employers' liability act, and a project for accident insurance. Even the Left sacrificed the principle of non-interference so far as to accept the trade act with its provisions for compulsory benefit associations. Another law intended to counteract the unrestricted supremacy of capital, which was passed, imposes limitations on joint-stock companies. The Liberals, who here as in Germany have been accused of indifference to the welfare of the humble classes, brought forward a scheme which embraced industrial, agrarian, and poorlaw reforms. They proposed to establish sickfunds, accident insurance, and superannuation pensions for industrial operatives at the sole cost of employers. The poor laws they wished to amend so as to enlarge the districts or facilitate the acquirement of a domicile, as now relief to the sick or hungry is often refused on account of non-residence, and in some cases persons are sent away from cities where there are hospitals to carry contagious diseases into their rural parishes. The agrarian question is one of great moment and difficulty in Austria, but is not likely to find the same reconstructive disposition on the part of the ruling factions as the