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THE AUSTRIAN PEOPLE ENDURED a series of political, social, and economic upheavals between the outbreak of World War I and the division of Europe into two hostile blocs shortly after World War II. In the next few decades, however, they succeeded in establishing a prosperous and stable democracy. Indeed, they were so successful that by the 1970s, Austria had come to be widely characterized as "an island of the blessed" because of the prosperity of its people and the virtual absence of social conflict.
Devised in the first decade after War World II, the system of governing--the social partnership--that made this achievement possible gave each of Austria's main social groups a decisive say in the management of the country's affairs. In marked contrast to the social tensions of the interwar period, which culminated in a brief civil war in 1934, in the postwar era the representatives of agriculture, commerce, and labor were able to work together harmoniously for the benefit of all. By the 1990s, the decades of prosperity engineered through the system of social partnership had given Austrians one of the world's highest living standards. Sustained prosperity and social peace yielded yet another achievement, the creation of a viable nation supported by the overwhelming majority of its citizens. Thus, the Austrian state assembled out of the ruins of the Habsburg Empire at the end of World War I--said by many to be "the state no one wanted"--was replaced by one that gradually won the allegiance of its citizens by providing them with a long period of uninterrupted peace and prosperity.
At the beginning of the twentieth century, the territory occupied by present-day Austria had been ruled by the Habsburg Dynasty for more than 600 years. This territory was the core of an empire that at its height in the sixteenth century included Spain and its colonies in the New World, and much of Italy and the Low Countries. Although a military defeat at the hands of Prussia in 1866 had weakened Emperor Franz Joseph I (r. 1848- 1916) and had obliged him to make such significant concessions to his Hungarian subjects the following year that the lands he ruled came to be known as Austria-Hungary (also seen as the Austro- Hungarian Empire), his empire remained one of Europe's great powers. In the last decades of the nineteenth century, it allied itself with Germany and Italy and in the years leading up to World War I actively pursued an aggressive foreign policy to extend Habsburg influence farther south in the Balkans.
The Habsburg Empire was supranational in nature. Many ethnic groups lived within its boundaries, including Germans, Czechs, Slovaks, Poles, Hungarians, Slovenes, Croats, Serbs, and Romanians. Most of the empire's German-speaking subjects lived in the territory that makes up present-day Austria, but significant numbers also lived in Bohemia, Moravia, and Silesia, and smaller numbers were found throughout the empire. Although the Hungarians had been granted the right to govern themselves and to have a significant say in determining the empire's affairs, German speakers remained dominant within the empire. Their dominance had gone on for centuries, although they made up only one-fourth of the population. Perhaps owing to their privileged status, the German speakers were more loyal to the empire than any other ethnic group. They did not see themselves as Austrian, however, but instead felt a strong local patriotism for their native provinces. They also thought of themselves as belonging to the German cultural community, a community found not only in Austria but also in Germany, and Switzerland, and anywhere else German was spoken.
In response to the nationalist movements emerging within Austria-Hungary, the empire's German speakers formed their own political groups, often described as German nationalist-liberal, to protect their rights. Because the German-speaking community remained loyal to Emperor Franz Joseph, few of its members wished to see the areas in which they lived secede from the empire and become part of the newly united and powerful Germany. Their aims were to maintain their privileged position within the empire and to ensure that the German language did not lose ground to the empire's other languages.
In addition to the German nationalist-liberal parties active in the late nineteenth century, German speakers created political parties that had other goals. The Social Democratic Workers' Party and the Christian Social Party were the most important political parties. The former sought to establish a socialist society based on Marxist principles. The latter sought to improve society, particularly (but not exclusively) rural society, by emphasizing Christian values and traditions. Because the memberships of both parties were largely German speaking, they had some sympathy with the aims of the empire's German nationalists. Their main concerns, however, were elsewhere.
World War I was set off by the June 1914 assassination of Archduke Franz Ferdinand, heir to the Habsburg throne, by Serbian nationalists. Within weeks, a system of interlocking alliances set the Great Powers of Europe against one another. By the war's end in November 1918, the Habsburg Empire had ceased to exist. Some of the empire's ethnic groups formed new nations. A German Austrian state was established on October 21, 1918. On November 12, 1918, one day after the war ended, the new state was declared a republic.
The new Austrian state was only one-fourth as large as the empire. In the eyes of many of its citizens, it was a mere "rump state" and was neither economically nor socially viable. Many argued that it logically should be part of Germany. The war's victors--the United States, Britain, and France--feared such a union would strengthen Germany, and they prohibited it. They also required that the new state be called the Republic of Austria rather than the German Austria. Despite the Allied prohibition, desire for union with Germany remained strong in Austria, particularly among German nationalist-liberals and socialists.
Shorn of many of the traditional economic connections it had had within the empire, Austria was poorly positioned to prosper. Its struggling economy was also hurt by the European economic slump of the early 1920s. The new republic's economic troubles diminished the support it needed from its citizens to survive. Rather than joining together to build a nation, Austrians sought social and economic security by withdrawing into the three large social groups, or camps (lager), that predated the war: German nationalist-liberal, socialist, and Christian Social.
Austrians usually gave their loyalty to the Lager in which they were born rather than to the country as a whole. Each Lager maintained a network of organizations such as credit unions, sports clubs, home mortgage funds, and the like that ministered to the economic and social needs of its members. Thus, contact among Austrians of different social backgrounds was lessened.
The hostility the groups felt for one another increased their inner cohesion. Socialist plans to establish a society founded on Marxist principles frightened the right-wing German nationalist- liberals and Christian Socials and heightened their determination to defend their property. Socialist and German nationalist- liberal anticlericalism caused Christian Socials to be more resolute in defending their religious values. German nationalist- liberal and Christian Social anti-Semitism caused many Austrian Jews to become active in the socialist movement. This in turn meant that many on the right came to hate socialism even more because they saw it as a Jewish-controlled conspiracy to subvert all cherished values.
In response to animosity the Lager felt for one other, armed militias were soon formed. The right-wing militia joined at times with state forces to oppose the socialists. Organized violence became frequent as the Christian Socials combined with the German nationalist-liberals to exclude socialists from the national government. Socialists governed only in Vienna. The many leftist social measures they enacted in "Red Vienna" further hardened conservative opposition.
A failed uprising in February 1934, in which the socialists sought to stand up to the central authorities, marked the definitive end of Austrian parliamentary democracy, already partially suspended the previous year. The Christian Social Engelbert Dollfuss established a right-wing authoritarian regime that attempted to govern Austria according to Christian principles. Austrian National Socialists, or Nazis, who desired to unite Austria with Germany, then ruled by Adolf Hitler, assassinated Dollfuss in July 1934. They were not strong enough to seize power, however, and the Dollfuss regime continued under the leadership of Kurt von Schuschnigg.
Despite the failed Nazi coup d'Útat, agitation for annexation, or Anschluss, of Austria by Germany continued. Schuschnigg resisted Hitler's demands for Anschluss for a time, but in March 1938 German troops occupied Austria. Because most Austrians felt little loyalty to their country, its seizure by Germany was widely supported, even by many socialists.
Austria was quickly and thoroughly absorbed by Nazi Germany. The country's new rulers attempted to expunge all traces of an independent Austria by ruthless personnel and administrative practices. Even the name Austria was replaced by a new designation--Ostmark. Austrians were drafted into the German army, the Wehrmacht, and when World War II began, they fought until Germany's unconditional surrender in May 1945.
Austria's human and material losses from the war were great. Furthermore, the country was divided into four zones, each occupied by one of the victorious Allies: the United States, Britain, France, and the Soviet Union. Under the watchful eyes of the occupation powers, Austrians reestablished a government based on the constitution of 1920, as amended in 1929. This second attempt of Austrians to govern themselves in a parliamentary democracy proved eminently successful. In what came to be called the Second Republic, Austrians enjoyed a long period of social peace and prosperity.
A key reason for the success of the Second Republic was the manifest failure of the First Republic (1918-38). Confronted with a defeat of this magnitude, Austrian politicians vowed not to repeat the mistakes of the earlier period. Leaders of opposing parties imprisoned together in Nazi concentration camps discussed what was needed to rebuild their country and agreed to play down the ideological differences that had made interwar politics so bitter. In addition, Nazi barbarities gave them good reason to emphasize what distinguished Austria from Germany.
External forces also contributed to the eventual success of the Second Republic. The occupation of Austria by foreign troops and the need to resist their demands encouraged a new Austrian unity, as opposed to the lethal divisiveness of the First Republic. Furthermore, the gradual extinguishing of political freedom in Eastern Europe in the first years after World War II made the principles of parliamentary democracy more attractive than they had been in the interwar period. The Soviet Union's practices in its occupation zone were a daily affront to Austrians and discredited political groups not committed to parliamentary democracy. In the interwar period, in contrast, no political party had fully supported this form of government, and several had been actively opposed to it.
In addition to failing to establish a working democracy during the First Republic, Austrians also had failed to put in place a nation supported by most of its citizens. During the Second Republic--likewise born in defeat at the end of a world war--a stable, prosperous society was created that with time engendered in its members a sense of pride in their Austrian identity. This feeling of a national identity was new. As late as 1956, only 49 percent of Austrians believed that they constituted a nation, whereas 46 percent saw themselves as Germans. Several decades of success as a nation altered the views of most Austrians on this matter. An opinion poll in 1989, for example, found that 78 percent of Austrians agreed that they constituted a nation, and only 9 percent held that they did not.
After World War I, Austria's economy floundered for a time, improved in the second half of the 1920s, then collapsed with the onset of the Great Depression. In contrast to this failure, after World War II an initial period of hardship was followed by decades of economic growth, which has continued into the 1990s.
In the first years after World War II, Austrians nationalized a large portion of their economy to protect it from foreign seizure, particularly by the Soviet Union. They also worked out mechanisms to involve the main participants in the economy-- agriculture, commerce, and labor--in determining democratically how the economy was to be managed. During the 1950s and 1960s, further bargaining institutions were created, most notably the Parity Commission for Prices and Wages, that involved economic interest groups and the government in major economic decisions. The resulting system, the social partnership, is responsible for the extremely low incidence of strikes in Austria and the sustained stability crucial for economic growth.
The economy fostered by the social partnership has grown steadily in the postwar period, often at growth rates above the Organisation for Economic Co-operation and Development (OECD) average. Between 1955 and 1990, the economy increased in size by two-and-one-half times. In step with the rest of Western Europe, the Austrian economy modernized quickly. Agriculture, still a significant part of the economy in the 1950s, by the early 1990s provided only about one-twentieth of the work force with employment and accounted for an even smaller share of the gross domestic product (GDP). In 1970 the industrial sector and the services sector accounted for roughly equal shares of GDP; by the 1990s the latter had become twice the size of the former and provided jobs for more than half the work force.
Although Austrian industry has a smaller place in the overall economy than it did earlier in the postwar period, it has become more specialized and produces high-quality goods that are competitive on the world market. Despite its small size, Austria is an active participant in the global economy, and foreign trade, two-thirds of it with the European Union (EU), accounts for two-fifths of GDP. A persistent trade deficit is largely offset by high earnings from tourism. Austria's place in the global economy has made imperative its membership in international economic organizations, such as the European Free Trade Association (EFTA) and the European Economic Area (EEA). Austria is scheduled to become a member of the EU on January 1, 1995.
The expanding economy has brought higher living standards for nearly all Austrians. Automobile ownership and travel abroad are commonplace, and an ever-widening range of state-supervised social benefits has made material want a thing of the past for ordinary Austrians. Sustained prosperity and a modernizing economy have permitted many Austrians to find better employment than did their parents. White-collar salaried employees now outnumber blue-collar workers. Much of the menial work is done by foreigners, who first began to arrive in significant numbers in the early 1960s and who at times have made up nearly 10 percent of the work force.
The great increase in white-collar employment permitted a tenfold increase in the number of Austrians enrolled at institutions of higher learning between the mid-1950s and the early 1990s. The upgrading of education at lower levels, such as specialized vocational training, is also impressive. As a result, many Austrians who themselves attended only elementary school have seen their children receive an education that results in well-paid skilled employment.
Social mobility has eroded the interwar division of Austria into Lager. The farming sector has dwindled into insignificance. In addition, the traditional blue-collar working class has diminished both in size and in cohesion as workers have become more middle class in their habits and expectations because of improvements in their housing, working conditions, and general standard of living. Many of their children have entered the ever- expanding middle class, which is no longer closed to outsiders. Younger Austrians, growing up in a more prosperous and egalitarian society than their parents, not only earn their livelihood in new ways but also have different social and political attitudes than the older generation.
In the decades after World War II, Austrian society has become more secularized. Regular church attendance has declined sharply, although the number of Austrians who have officially withdrawn from the Roman Catholic Church in this overwhelmingly Roman Catholic country has increased only slightly. The church itself has changed, withdrawing from the active and polarizing role it played in the interwar period. It speaks out only on issues it regards as within its legitimate sphere of interest. One such issue has been abortion. In the early 1970s, the church waged an ultimately unsuccessful campaign against the legalization of abortion.
The role of women also has changed in this new social environment. The so-called three Ks of Kinder, Kirche, and KŘche (children, church, and kitchen) no longer dominate women's lives to the extent they did in the past. Marriage is no longer seen as the only socially acceptable goal of a woman's life. Families are smaller, and by the 1990s the birthrate was below that needed for the population to increase. Divorce is more frequent, as is cohabitation by unmarried couples. The number of illegitimate births also has risen, although most of these children are subsequently legitimized by marriage.
Women now work outside the home in greater numbers than in the past. Although as of the first half of the 1990s women still earned less than men at all levels of employment, more women than ever before hold responsible positions. Some of the country's foremost politicians are women, and the number of seats held by women in the nation's lower house of parliament, the Nationalrat (National Council), increased from eleven in 1970 to thirty-nine in 1994. Laws have been passed to improve women's position in society. The Equal Treatment Law of 1979 mandates equal pay for equal work, and the Women's Omnibus Law of 1993 aims at increasing the employment of women in government agencies.
The economic and social changes Austria underwent in the postwar era began to affect the country's political life only in the second half of the 1980s. It was during this period that the dominance of political life by two large parties--a dominance that began immediately after World War II--began to be threatened by several smaller parties. Representing two of the country's three traditional social camps, the two parties are the Socialist Party of Austria, known since 1991 as the Social Democratic Party of Austria (Sozialdemokratische Partei Ísterreichs--SPÍ), the successor to the Socialists, and the Austrian People's Party (Ísterreichische Volkspartei--ÍVP), descended from the Christian Socials.
The SPÍ and ÍVP have governed Austria since 1945, often together in coalition governments. The latest of these so-called grand coalitions was formed in November 1994. Until 1970 the ÍVP was generally the stronger of the two parties. In that year, however, the SPÍ was led to power by the able and extremely popular Bruno Kreisky, who remained chancellor until 1983. In 1986 another effective leader, Franz Vranitzky, took over the SPÍ and through his personal popularity has been able keep the party in power even though the party's share of the vote has declined steadily.
However strong their political rivalry may be, both parties are committed to democracy, and they have adopted less ideological positions than did their predecessors in the interwar period. Decades of governing together have reduced the ideological differences between the two parties, and both support maintaining Austria's mixed economy and social welfare state. They have also been bound together by the elaborate patronage system of dividing between them the right to fill many positions in government agencies, in the extensive social welfare system, in the numerous bodies that make up the social partnership system, and in the large state-owned business enterprises. Because appointments to these positions often depend more on party membership than on qualifications, there have been instances of corruption and incompetence.
As an indication of the overall success of the SPÍ and ÍVP in governing Austria in the postwar era, only in 1990 did their joint share of the vote in a national election drop below 80 percent. In fact, in many national elections their joint share has been over 90 percent. Beginning in 1986, however, their support began to fall steadily. In the national election of October 1994, they received only 62.6 percent of the vote. The decline stems in part from the slow breakup of the Lager, which had loyal voting habits, and the emergence of a sizable pool of "floating voters," no longer invariably tied to the SPÍ or to the ÍVP.
The decline of the large parties also stems from voter dissatisfaction with the inefficiency and corruption of traditional political practices of governing the country and the emergence of new issues in a rapidly changing economy and society. The most serious challenger to the two main parties is a right-wing populist party formed in 1956, the Freedom Party of Austria (Freiheitliche Partei Ísterreichs--FPÍ), descended from prewar German nationalist-liberal groups. The party had seemed doomed to extinction until a young politician, J÷rg Haider, seized control of it in 1986 and through his dynamic leadership increased its share of the vote to 9.7 percent in that year's national election. The FPÍ nearly doubled its share in the national election of 1990 and won 22.5 percent of the vote in the national election of October 1994. This last victory occurred despite a split within the FPÍ in early 1993, when some of its members left to form a new party, The Liberal Forum (Das Liberale Forum). These members disagreed with Haider's position on foreigners in Austria and his departure from classic positions of European liberalism.
A superbly gifted politician, Haider has campaigned as a conservative populist, speaking out against the SPÍ-ÍVP decades- long stewardship of the country's affairs. He has exploited the anger of many voters at the pervasive cronyism and corruption of the SPÍ-ÍVP coalition and promised to end its system of patronage. Despite his clearly expressed hostility to socialism and the role of government in general, he has been able to successfully court many blue-collar SPÍ voters worried by the challenges posed to their country's small economy by a united Europe. With what many regard as demagogy, he has won votes by addressing that portion of the electorate who are concerned about the foreign presence in Austria and who fear ▄berfremdung, that is, Austria's submersion in a flood of foreign immigrants fleeing the social and economic chaos of Eastern Europe.
Traditional politics has also been challenged by the emergence of an environmentalist movement. Widespread economic security has freed young Austrians from immediate practical concerns and has allowed them to become concerned with longer- term issues such as protection of the environment. Galvanized by the construction of a large SPÍ-sponsored nuclear power plant in 1978, citizen groups focusing on the environment were formed; shortly thereafter, several environmentalist parties were established. In 1986 environmentalists were first elected to the Nationalrat; they have increased their share of the vote in each national election since. In the national election of 1994, the largest environmentalist party, The Greens (Die GrŘnen) won thirteen seats.
The European trend toward unification has also altered Austrian politics. In the first half of the 1990s, Austria's possible membership in the EU was likely the issue of greatest significance for the country's future. In 1989 Austria applied for admission to the European Community (EC), the predecessor of the EU. An interim step before admission was the January 1994 entry into the EEA. After years of negotiations with EC officials, in which the central points were protection of the environment, foreign ownership of real estate property, and farm subsidies, the SPÍ-ÍVP government called for a June 1994 referendum about EU membership.
The referendum was hotly contested. Although 66.4 percent of the electorate voted in favor of EU membership, the outcome of the vote was uncertain until the end. In addition to the SPÍ-ÍVP coalition, The Liberal Forum also supported membership. The most eloquent spokesman for this position was the minister for foreign affairs, Alois Mock, who had conducted the difficult negotiations concerning the conditions under which Austria would join the EU. In the late 1980s, Mock had persuaded his party, the ÍVP, that it should advocate Austria's becoming part of a united Europe. The SPÍ gradually came to the same view, even though EU membership would conflict with Austria's traditional neutrality. The EU has as a long-term goal not only economic unity but also a common foreign and security policy, which would by its nature preclude neutrality. Proponents of EU membership argued that it would bring economic benefits and contribute to the nation's security in a new and rapidly changing world.
Opponents of EU membership included many Austrian intellectuals, environmentalists, and the FPÍ, which had reversed its previously positive stance. Opponents argued that membership would bring a loss of Austrian sovereignty and that bureaucrats in Brussels would come to exert a suffocating control over the country's affairs. They feared that Austria's national identity might gradually be lost in a united Europe, given the country's small size. Haider justified his party's change of opinion by saying that it still desired European unity, but not one in which Austrian liberty was so restricted.
The overwhelming support voters gave to EU membership was a win for the coalition, but support came from many sectors of society, not just from traditional SPÍ and ÍVP voters. In fact, some members of the SPÍ and ÍVP opposed their parties' position because they feared the social and economic consequences of membership. This drop in support can be seen by comparing the two-thirds majority the two parties received din the referendum, version the three-quarters majority the coalition received in the 1990 national election.
The national election of October 9, 1994, was a resounding setback for the coalition. Both parties suffered significant losses in this election, which had an 82 percent voter turnout. The SPÍ remained the largest party in the Nationalrat. However, its share of the vote fell from 42.8 percent in the 1990 election to 34.9 percent, and its number of seats in the 183-member body fell from eighty to sixty-five. The ÍVP fared nearly as badly. Its share of the vote dropped from 32.1 percent in 1990 to 27.7 percent in 1994, and its share of seats fell from sixty to fifty- two. The FPÍ continued its upward trend by increasing its share of the vote, going from 16.6 percent in 1990 to 22.5 percent in 1994, and by winning forty-two seats, compared with thirty-three seats four years earlier. The largest of the environmentalist parties, The Greens, increased its share of the vote from 4.8 percent to 7.3 percent and the number of its seats from ten to thirteen. The Liberal Forum, in its first national election, won 6.0 percent of the vote and gained eleven seats.
The election showed that the political trends that had been under way through the 1980s had continued. The SPÍ-ÍVP share of the vote continued to drop precipitously, amounting to only 62.6 percent in 1994. As a result of these losses, the SPÍ-ÍVP coalition government formed in late November 1994 with Vranitzky as chancellor will not have the two-thirds majority needed to pass some legislation.
The election was a triumph for Haider, who throughout its course had determined the issues on which the election was fought: the threat of foreign immigration to the welfare of ordinary Austrians; and the incompetence and corruption of the pervasive system of governmental, party, and economic interest organizations that the SPÍ and ÍVP coalition had devised and that was suffocating the country's social and economic life. Haider saw his victory as merely another step toward becoming chancellor in 1998. To reach this goal, he has begun transforming his party into a political movement similar to that headed by Ross Perot in the United States. Whether or not Haider achieves his goal, he is likely to remain one of Austria's foremost politicians because of his skill in raising issues that have become central concerns to voters facing the challenges of the new Europe emerging after the end of the Cold War.
The end of the Cold War and the breakup not only of the Warsaw Pact but also of some of the countries that belonged to it have ended the decades of relative stability in Central Europe. In addition, in the early 1990s Yugoslavia, Austria's neighbor to the south, also broke into a number of separate states in the early 1990s, some of which were soon at war. Large numbers of refugees have fled to Austria and other Western countries, seeking temporary or permanent asylum. As a result of these events, Austria, once securely tucked away in one corner of Western Europe and sheltered from the East by the Iron Curtain, has come to occupy a more exposed and less secure position in Central Europe.
In the postwar era, Austria has pursued a neutral and active foreign policy. The State Treaty of 1955 ended the country's occupation by foreign troops and restored its sovereignty. As a condition for winning its independence, Austria pledged itself to permanent neutrality and promised never to join a military alliance or to allow foreign troops to be stationed on its territory. Lying between the two military alliances of the Cold War, Austria became an intermediary between the two blocs. Vienna became the home to international organizations and the site of important international meetings. An Austrian diplomat, Kurt Waldheim, was secretary general of the United Nations (1971-81), and Austrian military forces regularly participated in that organization's multinational peacekeeping missions around the world.
In the post-Cold War environment, however, Austria's active neutrality is seen by many as no longer relevant. Hence, policy makers are searching for a security policy better adapted to Austria's newly exposed position. Entry into the EU will reduce Austria's foreign policy independence and its traditional neutrality. Austria is expected to apply for observer status in the Western European Union (WEU) after it joins the EU and is likely to eventually become a member of this security organization. Austria's foreign policy makers maintain that there is no conflict between being a member of the WEU and maintaining the constitutional pledge of permanent neutrality, stating that it is Austria's right to interpret its neutrality. Whatever new security agreements are entered into later in the 1990s, however, Austria's policy of permanent and active neutrality, at least as it has so far been practiced, is probably nearing an end.
The likely extension of EU membership early in the next century to East European nations with free-market economies and parliamentary democracy will also reduce Austria's postwar role as an intermediary between East and West. As a result of the new Europe forming after the political and economic revolutions beginning in 1989, Austria is faced with abandoning the foreign policies that have served it so well in the postwar era. However, Austria will meet this new international environment not as a small poor nation surrounded by more powerful neighbors, as it did twice in the twentieth century after defeats in world wars, but as a prosperous and stable society and an integral part of a united Europe.
December 5, 1994