Austro-Italian ironclad arms race
In the years after Ferdinand Max's departure from Austria, the Imperial Austrian Navy suffered under further political and budgetary constraints. In April 1864, it was proposed that the naval ministry, which the former Archduke had helped to establish, be disbanded. In January 1865, Emperor Franz Joseph I dissolved the ministry and the Imperial Austrian Navy was again placed under the jurisdiction of the Austrian Ministry of War. Under the 1865 budget, just 7,100,000 Florins were allocated towards naval expenses, but once more, none of the funds were designated for warship construction. In 1866, the naval budget grew slightly to 7,800,000 Florins, but for the third consecutive year there would be no funds for additional ironclads, or other warships. Thus, when the Seven Weeks War began in June 1866, the Imperial Austrian Navy would possess only ships which had been constructed during Ferdinand Max's tenure as "Oberkommandant der Marine".
Seven Years' War
Not only that, Austria now found herself estranged with the new developments within the empire itself. Beside the rise of Prussia, Augustus III, although ineffective, could muster an army not only from Saxony, but also Poland, since he was also the King of Poland as well as Elector of Saxony. Bavaria's growing power and independence was also apparent as it asserted more control on the deployment of its army, and managed to disengage from the war at its own will. Most importantly, with the now belligerent Hanover united personally under George III of Great Britain, It amassed a considerable power, and even brought Britain in, on future conflicts. This power dynamic was important to the future and the latter conflicts of the "Reich". The war also proved that Maria Theresa's reforms were still insufficient to compete with Prussia: unlike its enemy, the Austrians were almost bankrupt at the end of war. Hence, she dedicated the next two decades to the consolidation of her administration.