The Habsburg Empire was simply not prepared to be in the 20th Century, on many fronts. Austria Hungary itself was a kind of remnant of the Age of European Discovery when it was its most powerful which was about 400 years before WW1. At that time the Habsburg realms included Spain and Portugal plus all their colonies, as well as Central Europe and the lowlands (Netherlands and Belgium). The Austrian Army’s officer corps was very old-fashioned, aristocratic and retrograde, composed of dilettantes and favor-seekers from the Habsburg (either spelling is accepted) court.
The Austrian State was also a victim of its own ambition in that it ruled many, many non-German speaking ethnic groups that had been fighting for independence or at least cultural expression for centuries (I am thinking of Bohemian nationalists who embraced Protestantism in particular) and the Austrian Army’s first mission was to suppress its own people, combined with the Austrian Civil Service and the Catholic Church. By the end of the 19th century it was said of the Austrian State that it had an army of soldiers on their feet, an army of priests on their knees an army of civil servants on their seats and an army of spies crawling on the ground.
The series of popular uprisings of 1848 hit the Habsburg Monarchy particularly hard, they did not allow any of the Slavs in their empire any recognition or autonomy, but the Hungarians were given equal status in 1867, making it the Austro-Hungarian Empire. However the many Slavic nationalities ranging from Croats, Bosnians and Slovenes to Czechs and Poles remained suppressed- if I’m not mistaken even their languages were not recognized by the state.
When the Ottoman Empire began disintegrating in the mid-19th century, Austria was eager to take over adjacent Turkish territories in Europe, but given the Slavic languages and Orthodox faith of many of these nations, it saw strong competition from Russia to influence the Balkans. Here the seeds of Sarajevo were sown.
Getting back to the utter lack of professionalism of the Austrian Army’s officer corps, I have two stories a history professor included in his lecture (no sources on these, sorry). When the Austrian Army was running field exercises by sending its officers to train with German cavalry in the years in the run-up to WW1, the German officer was puzzled when the Austrian liaison officer inquired if they were going to bet on the outcome of the exercise.
And when Emperor Franz-Josef received the telegram that Germany had launched its epic invasion of France, he was busy, watching horse races and he put the telegram in his race program where it was not found for years later.
When it came to performance in the First World War, there was also a problem of lack of unity of command between the Germans and Austrians. They were fighting on the same side, but they were not coordinating their efforts, so the Germans might be advancing against the Russians while the Austrians would be retreating
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