The difference between 2000 and 2017 in Austria is that this time around right-wing populism has been normalized. Back in 2000, the second and the third largest party, OVP and FPO negotiated a coalition government, in which the third-ranked OVP was able to get the chancellory after convincing the FPO to cede the highest post. Party leader Jorg Haider subsequently retreated to his little empire in Carinthia, which he ran as the state governor. That was the beginning of the end of the Haider-FPO.
First, Carinthia became involved in the Hypo Alpe Adria scandal, the provincial bank, which had been most exposed to international speculation in real estate, which resulted in bank bailouts in 2008 and the nationalization of the bank in 2009 (re-privatization in 2015). The blame went straight to the Haider administration. Second, without Haider at the helm of the national party there no longer was a charismatic leader among the ranks of the FPO, who could agitate the masses for his party. Third, the FPO turned out to be a mere junior partner to the OVP. The one measure that they were really proud of was the stricter enforcement of immigration restriction legislation. The voters realized the fraud of the FPO government and switched their support to the OVP in 2002, which became the clear winner in the elections. Lastly, after internal quarrels, Haider had assembled his close allies to form the BZO, a new political party, which temporarily split the nationalist camp until Haider’s car crash death in 2008.
When the OVP-FPO government formed in 2000 the great dismay of the EU-leaders resulted in nominal sanctions against Austria, which were lifted a few months after the inauguration. But 17 years later there are good chances that OVP and FPO will agree on a coalition government, thus returning the FPO back to power, but this time without sanctions. The OVP had been continuously serving in government since 1986, mostly as a junior partner to the OVP, as it had been difficult to become number 1, and yet in each leading position the OVP would enter in a coalition government with the FPO. The Vranitzky doctrine according to which the SPO would not enter a coalition government with the nationalist FPO kept the options continuously open for the OVP to remain in power.
The current parliamentary elections catapulted Sebastian Kurz OVP to the first-ranked position, which had long been anticipated, essentially since he became the party chairman. The OVP had received more than 31% of the vote, and will almost certainly receive the commission to form a government. Observers will recall that the principal reason for the OVP’s electoral success lies not just in the perception of youth and renewal that Kurz represents. I think Austrian voters are cynical enough to not be fazed by it. They were instead directly responding to Kurz right-wing pandering, as he became more and more intent on problematizing the vast number of refugees as contributing to the inability to integrate them and burdening the welfare system. By using nicer words than the FPO, but responding to the same primal fears of the public, Kurz was able to draw votes to what otherwise would go to the right-wing.
But one cannot merely state that the votes come from the right, because the FPO itself gained nearly 7 points to reach 27%, historically the best result for the FPO. The FPO is clearly a winner in these parliamentary elections. In part, their better performance comes from the fact that the smaller parties are pushed to the side. The Greens catastrophically lost nearly 10 points (and might not make it to parliament), Stronach no longer runs and is thus losing 5 points, while the BZO also is virtually suspended, as it still had about 3% support in 2013. A new party with immediate gains is Peter Pilz list, which promptly gained 4%. Pilz is a former Green parliamentarian and thus has diverted some support from them. He also distinguished himself by speaking out tough on criminal refugees.
Noteworthy is also that despite the anti-immigrant and anti-refugee position, which dominates the FPO agenda, its leader Heinz-Christian Strache has toned down his rather aggressive rhetoric (in his first ever campaign as leader for the 2005 Vienna elections, he had campaigned actively against Islam), thus presenting his party as an acceptable party to plan governing coalitions. And here comes, therefore, the main reason that the OVP and FPO coalition appears most likely: both parties agree on harsh anti-refugee policies, reducing the inflow of many more migrants. Both also agree on economic and social policy, which is about tax cuts for businesses and wealthy individuals financed by drastic cuts in social spending. The latter part is not explicitly admitted on either side, and they instead dodge that bullet by demanding cuts to the “bloated administration”, i.e. the vast army of civil servants that has been going back to the days of Maria Theresia.
The alternative to social spending cuts would have been more support for the SPO, which was just about holding even at 27% of the vote, being possibly second or third-ranked (remaining letter votes still have to be counted until next week). The incumbent governing party under chancellor Christian Kern faced several difficulties. First, by being the senior governing partner since 2007, the SPO is a used up force, and the voters indicate their desire for change. Second, while Austrian workers do suffer from the consequences of neoliberalism (shorter, more unstable work contracts, more uncertain work life), the perception of urgency has shifted from economic policy to migration, which the SPO refuses to capitalize on given their voting clientele, which includes many migrants.
Third, while leader Kern appears to be technically competent, he does not have the emotional appeal that his younger opponent Kurz had. What was noteworthy in their last common TV debate was that Kern had the greater technical competence, even going so far as denouncing Kurz for being corrupt by taking campaign donations from the rich and then writing a pro-rich campaign agenda, for which Kurz had no counter-point. While the SPO had long ago proposed a political platform (“Plan A”), the OVP kept most of its plans secret until the middle of September, a month before the elections. But technical competence and debating skills are not sufficient to convince the masses, who decide the elections. Fourth, the SPO has been suffering from the Silberstein affair, a former party campaign manager, who was imprisoned for embezzlement in his home country in Israel. It then turned out that Silberstein was an expert in dirty campaigning, which the other parties then exploited to hammer the SPO on. Whether Kern was aware of Silberstein’s dealings is unclear, yet it was a clear embarrassment to his party to have to deal with Silberstein allegations, which sows doubt among voters that the SPO is a trustworthy party.
Lastly, social democracy is under attack across Europe. Some scholars think that this is because the social democrats were too successful. Their raison d’etre was the creation of the welfare state, but now that the welfare state stands, there is no reason to support social democrats and people can vote for other parties. But I would argue precisely the opposite. The failure of the social democrats comes from their lack of defense of the welfare state. It certainly becomes hard to enforce retrenchment, but given the lack of huge economic growth the main engine to finance the welfare state is in trouble. The much missed Keynesian consensus depended on a unique class compromise among capitalists and workers, who share the abundant surplus among each other.
Social democrats thus become tolerated among capitalists, and welcomed by the workers, who no longer dream of revolution (if they ever did…). But these abundant surpluses are absent in today’s world of anemic growth despite record-low rates of interest and high levels of public and private debt. A peculiar form of social democracy arose in the 1990s, as these parties resigned to the power of finance, which came to support the welfare state in return for its deregulation. There are now countless studies that show how finance reinforces inequality (Lin and Tomaskevic-Devey 2013), not good news for social democrats. Further bad news is that finance-driven economic growth is inherently unstable, which became evident with the financial crisis in 2008. Whether the finance minister was social democratic or not, there was a strange optic when the government unloads the debts of private banks and then pays for this burden via austerity measures. In that case, as social democrats side with the bankers to save the capitalist and financial system as opposed to the working class, they shall not be surprised that they get less support.
PASOK, the Greek social democrats, have virtually been wiped out and are no longer a political force there. PASOK had been the first party to manage the fallout of the Greek debt crisis and to the extent that Greece began its long trip on the knife of the EU austerity regime, voters had no reason to sustain them. Now the Greek political landscape is limited to the socialist left and the conservatives, but they agree on the austerity-cum-bailout regime, thus invalidating democracy in Greece.
There is some hope for social democratic revival in Portugal and the UK. In Portugal, the moderate Socialist Party went into a minority government under Antonio Costa, while being propped up by a left party, a communist party and the green party. Their course had been to stop new austerity, privatization, worker-right diminution measures from Brussels, though the struggle is defensive, it is an advancement to the previous administration.
In the UK, the election of Jeremy Corbyn as party leader was the game changer, as the former backbencher insisted on scrapping Tory austerity and increasing social spending. He was scoffed at by Blairite colleagues in the Labour Party, warning that Labour would never serve in government with a left-wing lunatic in charge. Except that the bungled Brexit negotiations revealed the ineptitude of the Tory government under Theresa May and voters were willing to embrace a more left-wing alternative, which destroyed the Tory majority in the last parliamentary elections over the summer. May converted a Tory majority to a minority government propped up by the Northern Irish DUP, which restricted its support for the government on some key areas like Brexit and national security but not on austerity decisions like not raising the pay for NHS workers.
Back to Austria: It is technically possible for the SPO to continue the grand coalition, but they would have to enter as junior partners. There would, however, be a lack of credibility for continuing a coalition government, which is not only discredited in the eyes of the voters, but also in the eyes of the two parties themselves. Why would they call snap elections (a year before due date) if it was not to end the grand coalition? The two parties have sufficient disagreements that such cooperation probably makes no more sense. The other option would be for the SPO to cooperate with the FPO. These are two almost equally strong parties, but the disagreements on economic, social and migration policy are bigger between these two parties than for OVP and FPO. So the latter combination is still the most likely.
The vote pattern suggests stronger right-wing forces, yet again. What is to be done about automation in the workplace? What is to be done about the precarious workforce? What is to be done about the growing wealth gap between the rich and the poor? What is to be done about multinational companies that pay less taxes than small business people? What is to be done to create a more harmonious life between indigenous and foreign-descent Austrians? These questions will not be well addressed in the immediate future, but which government has ever done so?