Although the Hungarians were finally defeated, the Habsburg empire was weakened by the internal crisis, which resulted in lost wars against France (1859) and Prussia (1866). This led to a compromise between Austria and Hungary in 1867. Hungary stopped seeking full independence and in return received autonomy. The Habsburg empire officially became the Austrian-Hungarian monarchy (a joint-venture, one could say), though Austria had the dominant position in the new dualist state.

The 50 years after the 1867 compromise are one of Hungary's better periods. A very dynamic economic and cultural development started: by the end of the century Hungary was closer to Western-European standards than ever, at least after Mohács. Some highlights from this period:

* Buda and Pest were united, the new capital became a metropolis,
* an extensive railway network was built in the country,
* educational reforms were introduced & massive industrialization started: by the end of the century Hungarian industry was leading in certain fields (electricity, transport industry, telecommunication),
* Hungary's cultural life flourished.

The 1867 Compromise

If the Hungarians around you are crazily shouting in their strange mother tongue and accuse each other with being "brainless" or "traitor" (or so you figure), there is some chance that this compromise is on the agenda. The historic deal elaborated (from Hungary's side, at least) by Deák Ferenc has been a subject of heated debates since its birth.

Those who oppose the deal say that:

* From an ethical point of view, Hungary changed side by this compromise and became a reactionary power itself, trying to supress other nations seeking democracy and independence.
* From a practical point of view, the country tied itself to the declining empire of the Habsburgs and lost the chance to control its own fate any more. In fact, some even believe that the collapse of Hungary fifty years later could have been avoided if the nation does not accept the compromise in 1867.

Those who agree with the compromise argue that:

* The deal had a very beneficial effect on the country in the short term in economical, cultural and even political aspects.
* They also add that the country had no reasonable alternative: full independence was impossible for the time being and refusing the compromise would have resulted in continuing opression by the Austrians, further weakening the country.
* Although they admit, that the compromise gave up the demand for full independence and directed the country towards a more opportunistic policy, they deny that the compromise can be blamed entirely for events that came fifty years later.