The Popovici-proposal this is drawn from is probably too idealistic to have a good chance of prosection.
A more clear cut federation could be much more suitable. The POD for this would be 1867 or shortly afterwards. FJ would have to work out a clear Federal Constitution which is NOT to be renegotiated every 10 years. Then, not only establish a Hungarian Crown, but additionally a Bohemian one (add Upper Hungary=Slovakia) and a Croatian one (I am not sure under which Crown to place the Krain here). Autonomy to Galicia similar as in OTL. Autonomy and special economical concessions to Trieste (i.e. bribe the Italians there).
Therefore, you would have four "ruling" nationalities: Germans, Hungarians, Czechs, Croats. The Polish placated as long as the partition is a fact (and the Polish in AH by far the best-off, politically). Plus the Jewish element as a stabilizing factor.
Add to that a simple law: every officer, everybody who wishes to be enjoy his passive franchise, and every employee of the state above the lowest rank needs to be certified as speaking two of the main imperial languages fluently and basics of a third one. The certificates are being administered by educational institutions of the speakers of this language group (i.e. the Czech certificates are handed out by the Czech University of Prague, e.g.).
You would have a general level of understanding, force the Germans to learn more, and establish German firmly as a lingua france because it would be the first or second choice as a foreign language to most.
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BTW, Joseph II is not your guy, I assure you. He is enlightened, yes, but overeager, basically antagonizing everyone, Germanocentric and Centralistic.
His successor Leopold, who died after only a two year reign, is much more realistic and also even more liberal. Beforehands, he ruled somewhere in Italy (Tuscany IIRC) and did really well there.