Ausgleich

Ausgleich is a German noun meaning balance or compensation and, more broadly, a settlement that brings two sides to parity. It can refer to balancing accounts, offsetting differences, or compensating damages in legal or financial contexts.

The term is best known for the 1867 Ausgleich, or Compromise, between the Austrian Empire and the Kingdom of Hungary. After decades of reform efforts and the 1848 revolutions, the two realms agreed to a dual monarchy: Cisleithania (the Austrian part) and Transleithania (the Hungarian part) would share a single monarch and a common foreign and military policy, while maintaining separate internal constitutions, parliaments, and administrations. A common ministry of finance supervised finances for both halves. The Ausgleich created the Austro-Hungarian Empire, which lasted until 1918, and it profoundly shaped Central European politics, nationalities policy, and the region’s later history.

In modern usage, Ausgleich remains the standard German term for compensation or settlement in contracts, tort law, and financial accounting, reflecting the idea of bringing different interests into balance.