There seems to be a fairly broad consensus that Austria-Hungary will not annex (northern) Serbia and Montenegro, but will turn them into puppet states or protectorates. Probably combined with a permanent Austro-Hungarian military presence to maintain this situation. So basically a combination of voting options 2 and 3.
Yet during the 'Joint Council of Ministers of January 7, 1916' there were quite a few leaders in favor of annexation. For some more balance in the discussion, here are some translated quotes:
Stephan Burián (Foreign Minister):
Karl Stürgkh (Prime Minister):
Ernest von Koerber (Finance Minister):
Alexander von Krobatin (Minister of War):
Franz Conrad von Hötzendorf (Chief of the General Staff):
In conclusion, the Council of Ministers showed:
Yet during the 'Joint Council of Ministers of January 7, 1916' there were quite a few leaders in favor of annexation. For some more balance in the discussion, here are some translated quotes:
Stephan Burián (Foreign Minister):
Although he wanted to give the appearance of steering a middle course on the issue, Burián wrote in his diary on the same day that he believed in the necessity of the complete annexation of Serbia. But even total annexation, according to Burián, would be a burden that we could take upon ourselves only in recognition of its unavoidable necessity. Serbian agitation would be a problem even then. The decisive question is whether it would be easier to solve "the Serbian question if only 66 percent of all Serbs belong to the monarchy and 34 percent live in an independent state, than if 100 percent of Serbs become subject to us. At the moment, he said, it was not yet time to take a decision on which of the two methods mentioned here should be followed."
Karl Stürgkh (Prime Minister):
"A Serbia endowed with the prerogatives of an independent state, a head of state, international representations, would again and again become the focus of Great Serbian agitation. [...] Beside the great difficulties of the Polish problem, the admission of 1½ million more Serbs into the monarchy seems to him child's play."
Ernest von Koerber (Finance Minister):
Now, he said, there was an opportunity to put an end to the untenable conditions caused by the Greater Serbian idea. Therefore, independent Serbia, as a planting ground of the Greater Serbian movement, must disappear from the map. It would not matter for the peace negotiations, because the resistance of the Entente, especially Russia, to leaving a diminished, dependent Serbia would be the same.
Alexander von Krobatin (Minister of War):
"If Serbia is not wiped off the map, in 10 to 20 years the monarchy would be in a situation similar to that of 1914. Serbia, he said, could not be compared to Belgium, it was a miserable country; in his opinion, all the part of Serbia still left behind should be annexed to Hungary and divided into 4 counties. The one and a half million Serbs involved could not possibly be dangerous to such a vital state as Hungary."
Franz Conrad von Hötzendorf (Chief of the General Staff):
"doubts, however, the possibility of an independent Albania, and since, in his opinion, the whole of northern Albania must be united with the monarchy, as well as Montenegro and Serbia, he would cede southern Albania to Greece, and also a small strip to Bulgaria, if by this means the active participation of Greece could be obtained."
"I cannot believe in the crime that, after the heavy and bloody sacrifices which the war demanded, it [note: the monarchy] should again be put in this danger. I can hardly believe that the narrow, short-sighted, and petty reasons which are asserted against annexation should prevail."
In conclusion, the Council of Ministers showed:
"that the Austrian government representatives and military leaders were more and more resolutely in favor of annexations; on the other hand, that as a result they came more and more into opposition with the Hungarian leading circles, and only in view of the state of war did no open crisis arise."
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