kann die Wunden dieses Krieges heilen. Karl's refusal to abdicate was ultimately irrelevant. On the day after he announced his withdrawal from Austria's politics, the German-Austrian National Council proclaimed the Republic of German Austria. Károlyi followed suit on 16 November, proclaiming the Hungarian Democratic Republic. Successor states There were two legal successor states of the former Austro–Hungarian monarchy: German Austria (which became the First Austrian Republic) Hungarian Democratic Republic (which after a few other short-lived intermediaries became the Kingdom of Hungary) The Treaty of Saint-Germain-en-Laye (between the victors of World War I and Austria) and the Treaty of Trianon (between the victors and Hungary) regulated the new borders of Austria and Hungary, reducing them to small-sized and landlocked states. In regard to areas without a decisive national majority, the Entente powers ruled in many cases in favour of the newly emancipated independent nation-states, enabling them to claim vast territories containing sizeable German- and Hungarian-speaking populations. The decisions contained in the treaties had immense political and economic effects. The previously rapid economic growth of the imperial territories initially stalled because the new borders became major economic barriers. Many established industries and infrastructure elements were intended to satisfy the needs of an extensive realm. As a result, the emerging countries were often compelled to considerable sacrifices in order to transform their economies. A major political unease in the affected regions followed as a result of these economic difficulties, fueling in some cases extremist movements. Austria As a result, the Republic of Austria lost roughly 60% of the old Austrian Empire's territory. It also had to drop its plans for union with Germany, as it was not allowed to unite with Germany without League approval. The new Austrian state was, at least on paper, on shakier ground than Hungary. Unlike its former Hungarian partner, Austria had never been a nation in any real sense. While the Austrian state had existed in one form or another for 700 years, it was united only by loyalty to the Habsburgs. With the loss of 60% of the Austrian Empire's prewar territory, Vienna was now a lavish and oversized imperial capital lacking an empire to support it, thus being sarcastically referred to as the "national hydrocephalus". However, after a brief period of upheaval and the Allies' foreclosure of union with Germany, Austria established itself as a federal republic. Despite the temporary Anschluss with Nazi Germany, it still