WI: German Empire does not fall - consequences of a softer Versailles treaty

"It sounds kind of like what an American-brokered peace to end WW1 would look like."

This is my reaction. This looks a lot like the result of the peace initiatives by both the American and German governments in the winter of 1916-17 getting much further than they did, with the result that the Germans postpone unleashing the subs. Then without the Americans coming in, the British and French have to go along with the proposals after the mutinies and the February Revolution. By the way, the German government promised one man one vote in Prussian elections and other liberal reforms during the war, so you don't necessarily need Germany to lose to get them.
 
Italy got very, very close to walking off the talks with the OTL offer (in fact they did walk off - and then came back, which weakened their position). Give them even less, and they're just going to rip the armistice and go back to kicking the Austrians. Which could spur the rest of the Entente in doing the same (the French especially).
 
Proving that A-L was still seen as a military province by the german army (and nobility)

Note the key part of my message was "not very much unlike other parts of Germany". Even after the defeat in WWI, in the Reichsheer the old Prussian army saying remained popular: "there are two classes of people: soldiers and swine". Sure, the officers of 1913 would doubly look down on Alsatians, but it's not as if they would tolerate the slightest sign of a lack of servility from a bunch of Bavarian civilians.
 
- Germany restores Alsace-Lorraine to France, but no other border changes are made in the East.
- Germany renounces to Brest-Litovsk and accepts the creation of the Polish Republic, but without ceding territories to the new state. Otherwise, Poland receives Galizia from A-H.
- Czechoslovakia and Yugoslavia are not formed: German Austria (including Slovenia and South Tyrol), Croatia and Bohemia-Moravia remain as satellite or associated states of Germany, while Slovakia is part of the new Hungarian Republic, along with Transylvania. Serbia gets Bosnia-Herzegovina from A-H.
- No military occupation of Sarre, Rheinland etc. is performed. Germany and France agree on mutual demilitarization of their borderlands.

If Austria and Hungary split as outlined in the OP, then an Anschluss happens by 1920. Noone can stop it, as this ATL Germany is not neutered and is still the powerhouse of the continent. They will also likely annex Bohemia-Moravia, because why would they not. They have no obligations towards the Czechs and the region has significant industry they will need. Czechs are now in a bad place, trying to get by in a huge sea of Germans. With no Czechia, Slovaks are basically done for in Hungary. Romanians are a different story. Obviously too weak to fight Hungary at this point (Hungary is exhausted, but not neutered like OTL), but a war for Transylvania can be expected in the future. I could also see Croatia joining the Serbs.
 
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