Why didn't Bismarck take on Austria and merge it under Germany?

Question:

Why didn't Bismarck take on Austria and merge it under Germany?

And had Austria anything in common with Hungary that led to their merger? How did that system work nevertheless?

Best Answer - Chosen by Asker: Bismarck was a conservative nation builder so he just wanted to create a united Germany without upsetting the balance of power in Europe too much. If he would have tried to annex Austria-Hungary, the German Empire would have become the most powerful nation in Europe and alarmed the British, French, and Russians.

Also, Bismarck realized that the Balkan portion of Austria-Hungary was an ethnic war waiting to explode like it did in WWI.

Austria-Hungary was a dual monarchy with two separate states (Emperor of Austria and the King of Hungary) with one monarch and a unified defense, diplomatic, and trade policy. There was an Austrian Diet and a Hungarian Diet with differing rules and franchise.