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JOURNAL OF THE PLYMOUTE INSTITUTION. 
to the Duchies, then in their joint management. A temporary 
agreement was brought about by the Treaty of Gastein, in August 
20th, 1865, by which Austria took Holstein, Prussia took Slesvig, 
and Lauenburg was given up to the latter on payment of 2,500,000 
dollars to Austria. This treaty excited much feeling in Europe and 
Germany. Count Bismarck, in anticipation of future difficulties, 
secured Napoleon's neutrality. The relations between Austria and 
Prussia became more strained, until an open breach between the 
two powers became inevitable. Both governments call counsels of 
war. Austria decides to make some preparations ; Prussia charges 
Austria with this, and issues a decree to mobilise the army. 
Alliance offensive and defensive is concluded between Prussia 
and Italy on April 7th, 1866. 
^otes are exchanged between Austria and Prussia on the subject 
of mutual disarmament. Both agree to this, but Austria pleads 
the condition of Italy as a reason for maintaining the army of 
Italy on a war footing. 
Prussia refuses to acknowledge the necessity for this ; the other 
great Powers try to interfere and fail. The Diet is convoked, and 
Pederal execution decreed against Prussia. Prussia declares that 
by this act the constitution of the Confederation has been violated, 
and it is therefore dissolved. War. Resources of the belligerents. 
The success of the Prussian arms is followed by the Treaty of 
Nicolsburg, signed July 30th. 
Austria is excluded from the German Confederation and loses 
Yenetia. Prussia annexes Hanover, Hesse Cassel, Nassau, and 
Prankfort. The North German Confederation is formed, with 
Prussia at its head ; a secret treaty is made between Prussia and 
the Southern States ; henceforward Germany is Prussia. 
In conclusion, the question is discussed. How far the fall of 
the Germanic Confederation is to be regarded as a misfortune to 
Germany ? Answered in the negative. 
