Austro-Italian ironclad arms race
Seizing upon the decline of the Regia Marina in the years immediately after the Battle of Lissa, Tegetthoff worked to continue the efforts of Archduke Ferdinand Max of expanding the ironclad fleet of the now Austro-Hungarian Navy. Tegetthoff found political allies in the Austro-Hungarian Minister of War Carl von Franck and retired Admiral Bernhard von Wüllerstorf-Urbair. Wüllerstorf's and Franck's primary arguments in favor of continuing with the ironclad program Austria had engaged in prior to the Seven Weeks War lay largely along economic grounds. The two believed that constructing new ironclad warships would rejuvenate Austria-Hungary's economy following the defeat at the hands of Prussia and Italy, and that such a fleet would help to open up new commercial opportunities in the Levant and the Middle East. These proposals would be shelved however while Austria continued to reel from the military defeats inflicted by Prussia, and several cabinet reshufflings by Emperor Franz Joseph I resulted in a government more interested in pursuing revenge against Prussia than constructing new ironclads, which would be of little use in a hypothetical second war with Prussia.
Military history of Germany
In the War of Austrian Succession (1740–48) Empress Maria Theresa of Austria fought successfully for recognition of her succession to the throne. However, during the subsequent Silesian Wars and the Seven Years' War, King Frederick the Great (Frederick II) occupied Silesia and forced Austria to formally cede control in the Treaty of Hubertusburg of 1763. Prussia had survived the combined force of its neighbours, each larger than itself, and gained enormously in influence at the cost of the Holy Roman Empire. It became recognised as a great European power, starting a rivalry with Austria for the leadership of the German-speaking lands.