How did Otto von Bismarck deal with Prussia's military budget crisis?
When Otto von Bismarck became minister-president of Prussia in 1862, he inherited a severe constitutional crisis between King William I and the Chamber of Deputies over military reform and funding.12
To bypass the liberal majority’s refusal to approve the military budget, Bismarck devised a theory that there was a "gap in the constitution". He argued that because the legislature and the king could not reach an agreement, the government was obligated to continue functioning in the interim. Consequently, he proceeded to collect and spend taxes based on the previous budget, allowing him to implement the military reforms without parliamentary sanction.12
This confrontational tactic persisted from 1863 to 1866. Following Prussia's victory in the Seven Weeks’ War in 1866, Bismarck sought to resolve the internal conflict by offering an olive branch to the liberals. He requested an act of indemnity to retroactively legalize the unconstitutional collection of taxes, which the parliament passed on September 3, 1866, effectively ending the crisis.132