Austria

I. INTRODUCTION

Austria (German Österreich), republic in central Europe, bounded on the north by the Czech Republic; on the northeast by Slovakia; on the east by Hungary; on the south by Slovenia, Italy, and Switzerland; and on the west by Liechtenstein, Switzerland, and Germany. Austria is about 580 km (about 360 mi) long and has an area of 83,858 sq km (32,378 sq mi). Vienna (Wien) is the country's capital and largest city.

II. LAND AND RESOURCES

Austria is predominantly a mountainous country, with an average elevation of about 910 m (about 3,000 ft). Most of the land falls within the eastern division of the Alps. In general the major mountain ranges of Austria run in an east-west direction and are separated from one another by rather broad valleys. The northernmost line of ranges includes the North Tirol (Tyrol) Alps and the Salzburg Alps. Among the central ranges is the Hohe Tauern, which culminates in the Grossglockner, the highest elevation (3,797 m/12,457 ft) in the country; the Pasterze Glacier, one of Europe's largest, descends from the Grossglockner peak. The southernmost ranges include the Ötztal Alps, the Zillertaler Alps, the Carnic Alps, and the Karawanken Mountains. Besides these east-west ranges, several series of mountain spurs extend in a north-south direction. The mountain barriers of Austria are broken in many places by passes, including the Brenner Pass and the Semmering Pass.

The principal areas of Austria that are not within the Alps are the northern and eastern border sections. The northern section consists of rolling upland, and the eastern border section comprises part of the Danube basin, including Vienna.

The principal river is the Danube, which enters Austria at Passau on the German border; it continues its southeastern course, past Linz and Vienna, to Bratislava on the Slovakian border. Austrian tributaries of the Danube include the Inn (forming part of Austria's German border), Traun, Enns, and Ybbs rivers. In the south, important rivers are the Mur and the Mürz. In addition to the rivers, the hydrographic system of the country includes numerous lakes, notably Bodensee, forming the western border with Liechtenstein and Switzerland, and Neusiedler Lake in Burgenland, near Hungary. The lake is the country's lowest elevation point (115 m/377 ft).

A. Climate

The Austrian climate varies with elevation; with location in relation to Atlantic, continental, and Mediterranean influences; and with certain local wind characteristics. Mountainous regions are partially subject to moderate Atlantic conditions and experience more precipitation than the eastern lowlands, which are under continental influences. Spring and fall are usually mild throughout the country. Summers are short, with moderate temperatures. Cold and often severe winters last about three months in the valleys, where they are usually ended by the foehn, a warm, dry wind from the south that is often accompanied by damp fog and sudden thaws that precipitate avalanches. The foehn is important to Austria's agricultural production, allowing for early cultivation of the southern valleys. Average annual temperatures range between about 7° and 9°C (about 44° and 48°F) throughout the country. Average annual rainfall is 610 mm (24 in) in Vienna and 870 mm (about 34 in) in Innsbruck. In some interior valleys, the average annual rainfall is between about 1,520 and 2,030 mm (about 60 and 80 in).

B. Mineral Resources

Austria has sizable deposits of iron ore, lignite, magnesite, petroleum, and natural gas and is a prime world supplier of high-grade graphite. Some small deposits of bituminous coal have been mined, as well as lead, zinc, copper, kaolin, gypsum, mica, quartz, salt, bauxite, antimony, and talc.

C. Soils

Rich terra rosa (red) soils predominate in Austrian valleys. At slightly higher elevations, the soil is of a brown forest type. Alpine meadow soils are usually found in high-elevation regions.

D. Plants and Animals

Deciduous trees, mainly beech, oak, and birch, are predominant in the lower elevations; spruce, fir, larch, Austrian black pine, and stone pine extend to the timberline. The higher elevations have a very brief season during which alpine plants, including edelweiss, gentians, primroses, buttercups, and monkshoods, come into brilliant flower.

Wildlife is generally scarce in Austria. Chamois, deer, and marmot are still represented; bear, which were once abundant, are now almost completely absent. Hunting is strictly regulated to protect the remaining species.

E. Environmental Issues

Industrial emissions, a high volume of tourist traffic, and significant air pollution from other countries—principally Germany, Slovakia, and the Czech Republic—combine to make acid rain the major environmental problem in Austria. One-quarter of the forests suffer some acid damage, and tree cover may be significantly reduced in some areas. To combat this problem, the country has imposed the most stringent automobile exhaust standards in Europe. Other environmental threats include agricultural expansion, damming of rivers for hydroelectric power generation, and erosion caused by loss of forest cover.

The country is 46.9 percent (1995) forested, with most forests located in the alpine zone and consisting of fir, pine, and oak, or oak and chestnut at lower elevations. About 85 percent of the forests are reserved for timber harvest. Wetlands have been reduced to 10 percent of their historic extent.

Austria's land protection system exists mostly as separate designations of the nine provinces. Overall, 28.3 percent (1997) of the country is under some form of protection, including three national parks and hundreds of nature reserves, nature parks, and landscape reserves.

Austria has joined with its neighbors in formulating plans to protect the Alps and is working toward transborder protected area designations with Germany and Hungary. Austria has signed and ratified conventions on the conservation of wildlife and natural habitats and on wetlands.

III. POPULATION

The Austrian people are German-speaking, but the country has a varied ethnic mixture—a legacy from the time of the multinational Habsburg Austria. About 99 percent of the population is ethnic Austrian. Minority groups include Croats and Hungarians (in Burgenland), Slovenes (in Kärnten [Carinthia]), Czechs (in Vienna), as well as small numbers of Italians, Serbs, and Romanians. An influx of refugees in the years following World War II (1939-1945) increased their numbers, and new groups, such as the Turks, were added.

A. Population Characteristics

According to the 1991 census, Austria had a population of 7,795,786. The 2001 estimated population was 8,150,835, giving the country an overall population density of 97 persons per sq km (252 per sq mi). Some 65 percent of the population is urban, with more than one-quarter of the people living in the five largest cities: Vienna, Graz, Linz, Salzburg, and Innsbruck.

B. Political Divisions

Austria is divided into nine federal provinces (Bundesländer): Burgenland, Kärnten (Carinthia), Niederösterreich (Lower Austria), Salzburg, Steiermark (Styria), Tirol (Tyrol), Oberösterreich (Upper Austria), Vienna (having the same boundaries as the city), and Vorarlberg.

C. Principal Cities

Vienna, the capital and largest city, had a population of 1,606,843 in 1999. Other important cities include Graz, a center for heavy industry, with a population of 240,513; Linz, the provincial capital of Oberösterreich and a port on the Danube, with 189,073; Salzburg, a cultural and tourist center, with 143,991; and Innsbruck, the provincial capital of Tirol and a tourist attraction because of the beauty of the city and its location, with 110,997.

D. Religion

Roman Catholicism is the religion of about 78 percent of the population of Austria. Reformed Lutherans and various other Christian denominations account for 6 percent, and those without a religion or whose faith is unknown constitute 16 percent of the population.

E. Language

German is the official language of Austria. About 2 percent of the population speaks languages other than German, chiefly Bosnian, Croatian, Serbian, Slovenian, and Turkish.

F. Education

The basis of the Austrian educational system is the national law that requires school attendance for all youths between the ages of 6 and 15. Austria's long tradition of free education dates from the Educational Reform Act of 1774, instituted by Empress Maria Theresa. This law, which was expanded in 1867 and again in 1962, largely accounts for the fact that virtually all of the adult population is able to read and write.

Although the foundations of Austria's present educational system were laid in the 18th century, its roots can be traced to the monastic schools of the Middle Ages. One such school, the Schottengymnasium in Vienna, has been in continuous operation by the order of the Benedictines since 1155. Austria was under German occupation from 1938 to 1945, and the country's schools suffered severe restraints on their teaching programs. Since World War II, various programs have been inaugurated to expand and strengthen the educational system.

During the 20th century, Austria received international recognition for the high quality of its medical training. In the arts it has sought new approaches to the awakening of students' creative interests, especially in the field of art education under the leadership of Franz Cizek. In many aspects, Austrian schools were among the first anywhere to be marked by a general trend toward progressive education.

F.1. Elementary and Secondary Schools

All students attend elementary school (Volksschule) for four years. Children who will end their schooling at the age of 15 either enter vocational school or continue elementary school. Secondary school education is limited to ages 10 through 18; it is required for admission to a university. In 1995 some 382,005 students annually attended 3,718 elementary schools, and 793,500 students were enrolled in secondary or compulsory vocational schools.

F.2. Specialized Schools

Austria has an extensive system of special schools and adult education centers. In the early 1990s nearly 186,300 students were enrolled annually in technical, upper-level vocational, or teacher training institutions.

F.3. Universities and Colleges

The largest of Austria's 18 university-level institutions is Vienna University (1365). Other major universities are Graz University (1586), Innsbruck University (1669), and Salzburg University (1622). Austria also has two technical universities; colleges of mining, agriculture, veterinary medicine, and commerce; and five academies of fine arts and music, which also offer summer programs that attract foreign students. University enrollment in 1996-1997 was 240,600.

G. Culture

Throughout the 18th and 19th centuries, Vienna was a world center of culture, particularly in music and literature. Austrian fine art usually is considered with the art of southern Germany. A distinctive Austrian style, however, is manifested in the refined baroque architecture and sculpture of the 17th and 18th centuries, notably in Vienna, Salzburg, and Melk.

G.1. Libraries and Museums

The largest of the 2,400 libraries in Austria is the National Library, founded in 1526. Important research collections are housed in the various universities, in several old monasteries, and in a number of scientific libraries. The collection of the former royal house contains state papers dating from 816, collections of the Holy Roman Empire dating from 1555, and documents concerning the history of the Austrian Empire, the Austro-Hungarian monarchy, and the period since 1918.

The art and natural science museums of Vienna are internationally known, as are many individual collections. The Kunsthistorisches Museum (Museum of Art History) is famous for its paintings by members of the Brueghel family and for the works of Dutch, Italian, and German painters. The Albertina collection of prints and drawings, the collections of jewelry and relics of the Holy Roman Empire, the Austrian Gallery, the technical museum, and the museum for folklore and ethnography are all well known. Salzburg, birthplace of composer Wolfgang Amadeus Mozart, has several museums housing collections of his manuscripts and memorabilia, including one in the house where he was born.

G.2. Literature

See Austrian Literature.

G.3. Art

Important art contributions include early wood carvings, Gobelins tapestries, hand-carved and hand-painted chests, intricately forged grates and other ironwork, stained-glass windows, Augarten porcelain from Vienna, lace, and leatherwork. Wood carving and sculpturing have long been popular among the people of the Alpine valleys. Among the best-known modern painters of Austria are Gustav Klimt, Egon Schiele, Oskar Kokoschka, and Hundertwasser.

G.4. Music

The Land of Music is a name often given to Austria. Composers Wolfgang Amadeus Mozart, Anton Bruckner, Joseph Haydn, Franz Schubert, Johann Strauss the Elder and Younger, Ludwig van Beethoven, Franz von Suppé, Gustav Mahler, Richard Strauss, Alban Berg, Anton Webern, Franz Lehár, and Arnold Schoenberg, as well as conductors Felix Weingartner, Clemens Krauss, and Herbert von Karajan, are just a few who have enriched Austrian cultural life. The Vienna Boys' Choir and the Vienna Philharmonic Orchestra are celebrated organizations. Vienna has two famous opera houses, the Volksoper (People's Opera), opened in 1904, and the Vienna State Opera, completed in 1869 and known for its beautiful architecture and fine performances. In addition, every provincial capital has its own theater, and the summer festivals in Vienna, Salzburg, and Bregenz are outstanding musical events.

IV. ECONOMY

The Austrian economy is based on a balance of private and public enterprise. All the basic industries were nationalized in 1946; these included all oil production and refining; the largest commercial banks; and the principal companies in river and air transportation, railroad equipment, electric machinery and appliances, mining, iron, steel, and chemical manufacturing, and natural-gas and electric power production. However, government control was reduced through privatization efforts in the late 1980s and early 1990s, allowing for the sale of shares in many nationalized companies to private investors. Over the years, Austria maintained close ties with the countries of Eastern Europe. Since the collapse of Communism in those countries in the late 1980s and early 1990s, more than 1,000 Western companies have chosen Austria as their base for new Eastern European operations.

In 1998 the estimated annual national budget included revenues of $79 billion and expenditures of $85.5 billion. Gross domestic product (GDP) was $208.2 billion in 1999.

A. Agriculture

Of the total land area, 17 percent is cultivated. About half of Austrian farms are under 10 hectares (25 acres) in size.

Major products in 2000 (with yields) were wheat (1.3 million metric tons), barley (854,700), maize (1.6 million), grapes (364,000), potatoes (660,000), sugar beets (2.6 million), and fruits such as apples (1 million). Austria's farms satisfy most of the food needs of the country, and some surpluses, such as dairy products, are exported. Annual milk production was about 3.3 billion liters (about 870 million gallons). Livestock included 3.8 million pigs, 2.1 million cattle (of which about one-fourth were milk cows), 383,655 sheep, and 74,170 horses.

B. Forestry and Fishing

Some 47 percent of the total land area is forest. A comprehensive reforestation and conservation program has been in progress since the early 1950s to compensate for damage inflicted during World War II and for postwar overcutting of forest trees. About 78 percent of the forests consists of conifers, mostly spruce, which are important in the paper and pulp industry as well as in building construction. In 1999 some 14.1 million cubic meters (497 million cubic feet) of roundwood were cut.

Processing and consumption of fish are low in Austria, and most table fish are imported. Sport fishing in the mountain streams is popular.

C. Mining

The major minerals extracted in Austria in 1999, with annual production (metal content), included iron ore (500,000 metric tons) and silver (1 metric ton). Fossil fuel production included crude petroleum (7.7 million barrels), coal (1.2 million metric tons), and natural gas (1.7 billion cubic meters/60 billion cubic feet). Other minerals commercially mined included magnesite, copper, lead, salt, graphite, gypsum, kaolin, and talc.

D. Manufacturing

The Austrian manufacturing industry consists of a few large organizations, many of which operate under government auspices, and a great number of small and medium-sized production units. Many of the smaller enterprises make traditional Austrian wood, glass, textile, and ceramic handicrafts. About 26 percent of the labor force is employed in the manufacturing sector. The principal manufactured products in the early 1990s were machinery, metals and metal products, chemical products, food products, and wood and paper products.

E. Tourism

With the famous Alps and a wealth of cultural and recreational facilities, Austria is one of the world's top tourist destinations. A premier winter sports area, the country also has summer music festivals (including the famous Salzburg Festival), lake resorts (especially in Kärnten), medicinal spas, and many museums and other attractions. In 1999 some 17 million people from other countries visited Austria. More than half of these tourists were from Germany, with the rest coming primarily from The Netherlands, Italy, the United Kingdom, Switzerland, France, and the United States. An important part of the Austrian national economy, tourists spent $11.1 billion in the country in 1999.

F. Energy

Austria has numerous hydroelectric installations, which together produced 66 percent of the country's electrical output in 1998. Austria generated a total of 59.3 billion kilowatt-hours of electricity. Substantial amounts of hydroelectricity were exported to other European countries, but Austria was forced to import natural gas from Eastern Europe, as well as crude petroleum, to meet its energy needs.

G. Currency and Banking

The monetary unit of Austria is the single currency of the European Union (EU), the euro (1.07 euros equal U.S. $1; 1999 average). Austria is among 12 EU member states to adopt the euro. The euro was introduced on January 1, 1999, for electronic transfers and accounting purposes only, and Austria's national currency, the schilling, was used for other purposes. On January 1, 2002, euro-denominated coins and bills went into circulation, and the schilling ceased to be legal tender.

As a participant in the single currency, Austria must follow economic policies established by the European Central Bank (ECB). The ECB is located in Frankfurt, Germany, and is responsible for all EU monetary policies, which include setting interest rates and regulating the money supply. On January 1, 1999, control over Austrian monetary policy was transferred from the central bank of Austria, the Austrian National Bank, to the ECB. After the transfer, the Austrian National Bank joined the national banks of the other EU countries that adopted the euro as part of the European System of Central Banks (ESCB). Austria has more than 1,100 commercial, savings, cooperative, and mortgage banks.

H. Commerce and Trade

The value of imports in 1999 was $68.8 billion. Industrial and general machinery, transportation equipment, clothing and accessories, metals, food products, metal manufactures, textiles, office machines, and petroleum and petroleum products were among the chief import commodities. Austrian exports totaled $63.4 billion in the same period. The principal products exported included specialized and general industrial machinery, metal manufactures, electrical machinery, transportation equipment, paper and paper manufactures, iron and steel, textiles, engines, and telecommunications and sound equipment. Germany is the largest market for and supplier to Austrian industry. Other leading markets for exports include Italy, Switzerland and Liechtenstein, Hungary, and the United Kingdom. Leading sources for imports (in addition to Germany) are Italy, the United States, France, and Switzerland. Austria became a member of the European Union in 1995.

I. Transportation

Austria has a highly developed system of rail, air, water, and highway transportation. In 1998 the country had 5,643 km (3,506 mi) of railroads, about 90 percent of which were owned by the state. As a landlocked and mountainous country, Austria depends on rail passage for a major share of its foreign trade. Improved highways and roads totaled about 200,000 km (124,274 mi). Water transportation is confined largely to the Danube River. The state-owned First Danube Steamship Company, the largest shipping company in Austria, provides both freight and passenger service on the river. Many international carriers serve Austrian airports, with most traffic to Schwechat, near Vienna. Austrian Airlines, the national airline, serves many European and domestic routes.

J. Communications

Radio, television, and telephone systems were all state monopolies until the broadcasting system was converted into a joint-stock company in December 1957. The Austrian Broadcasting Company provides three radio and two television services. In 1997 there were 751 radios and 525 televisions licensed per 1,000 persons.

Telephone communications are directed by the Austrian postal service. In 1999 there were 472 telephone mainlines for every 1,000 persons. Some 17 daily newspapers are published; daily newspaper circulation averages 2.4 million. Newspapers with a national circulation include Wiener Zeitung (the oldest daily newspaper in the world), Neue Kronen-Zeitung, Kurier, Der Standard, and Die Presse, all published in Vienna; and Salzburger Nachrichten, published in Salzburg.

K. Labor

In 1999 the Austrian labor force totaled 3.8 million. About 60 percent belonged to the 15 unions that make up the Austrian Trade Union Federation. Membership in unions is voluntary, but all wage earners are required by law to join their respective chambers of labor. Chambers are organized on a provincial basis and represent workers on legislative matters. Women make up 40 percent of the total labor force.

V. GOVERNMENT

Austria is a democratic, federal republic governed according to the constitution of 1920, as amended in 1929 and subsequently modified. Like the constitutions of many other Western democracies, the constitution of Austria provides for a distinct division of power among the executive, the legislative, and the judicial branches of government. Laws having their origin in 1862 and 1867 guarantee basic human rights and liberties; the rights of minorities are also guaranteed by the constitution.

A. Executive

Executive power is exercised by the president of the republic, who is elected by popular vote every six years, and by the Council of Ministers, or cabinet, which is headed by a chancellor, appointed by the president for a term not exceeding four years. Suffrage is universal for citizens 19 years of age and older.

B. Legislature

Federal legislative power is vested principally in the Nationalrat (National Council), or lower house of the bicameral Federal Assembly. The Nationalrat is composed of 183 members elected for four-year terms by popular vote according to proportional representation. The cabinet may remain in office only so long as it enjoys the confidence of the Nationalrat. The Bundesrat (Federal Council), the upper house, consists of 64 members chosen by the provincial legislatures in proportion to population for terms ranging from four to six years, depending on the length of terms of the provincial legislatures they represent. Although the powers of the Bundesrat are primarily advisory, the council can delay the passage of bills.

C. Political Parties

Austrian politics in the second half of the 20th century were dominated by two main parties, the Social Democratic Party (called the Socialist Party until 1991) and the Austrian People's Party. Beginning in the late 1980s, however, the right-wing Freedom Party gradually gained strength. Other national parties included a coalition of Green parties, which are affiliated with the international Greens environmental movement, and the Liberal Forum.

D. Local Government

Each of the nine provinces has a unicameral legislature elected on the same basis as the Nationalrat. The legislature chooses a provincial governor. All legislation must be submitted by the governor to the federal ministry for approval. The provincial legislature, however, may override a ministry veto by majority vote. Cities and villages are administered by elected communal councils, which in turn elect mayors, or burgomasters.

E. Judiciary

The legal system is based on the division between legislative, administrative, and judicial power. There are three supreme courts: the Supreme Constitutional Court, the Supreme Administrative Court, and the Supreme Judicial Court. The judicial courts include 4 higher provincial courts, 17 provincial and district courts, and about 200 local courts. The constitutional court deals with matters affecting the country's constitution, and examines the legality of administration and legislation. The administrative court deals with matters affecting the legality of administration.

F. Health and Welfare

The Austrian system of social insurance is comprehensive, including sickness, disability, accident, old-age, and unemployment benefits, allowances for families with children, and rent aid. The program is financed by compulsory employer and employee contributions. Health insurance and some other benefits are voluntary for those who are self-employed.

G. Defense

An Austrian army was authorized by the treaty of May 15, 1955. Under the terms of this treaty, which promulgated Austria's sovereignty and neutrality, no limitation was placed on the army size, but its equipment was restricted to conventional weapons. Austria has compulsory military service of six months plus duty in the reserves for men aged 18 to 50. In 1999 the Austrian armed forces included 35,500 members. Austria is not a member of the North Atlantic Treaty Organization (NATO).

VI. HISTORY

At the beginning of the Christian era, Austria was sparsely inhabited by Illyrian and Celtic peoples who from time to time advanced into the northern plains of Italy.

A. Early Period

Much of the region south of the Danube River was known as Noricum. The western uplands region between the upper Rhine River, the lower course of the Inn River, and the Bavarian and subalpine plateau was known as Rhaetia, an area which also included parts of modern-day Germany and Switzerland. The plains region in the east and southeast was known as Pannonia and included areas in present-day Hungary and Slovenia. The Romans invaded all three regions about 15 BC and made them provinces of the empire. Under Roman control, the provinces eventually became outposts for offensive and defensive action against various barbarian tribes. To a large extent Roman strategy was based on the fact that the region contains important passes through the Eastern Alps and thus commands vital transportation arteries between northern, southern, western, and eastern Europe. One of the first Roman military posts in the region was Vindobona (now Vienna), which was located on the site of a Celtic settlement on the edge of the Eastern Alps and on an arm of the Danube. Vindobona became an important strategic crossroad for two main trade routes and for numerous roads leading into the fertile basin of Niederösterreich. Carnuntum (now Petronell), east of present-day Vienna, was another important Roman center in the area.

As a result of periodic overpopulation and land hunger, combined with pressure from remote peoples and the attraction of the wealth of the peaceful Roman provinces, tribes of the Germanic peoples attacked the provincial frontiers at various times starting in AD 166. The frontiers completely broke down during the 4th century AD. Goths, Rugians, Lombards, Vandals, Ostrogoths, and Huns at one time or another crossed the Vienna Basin. The Alamanni advanced into Rhaetia, the Herulians captured Juvavum (now Salzburg), and the Goths advanced along the Drava (Drau) River.

The Slavs and the Avars moved into Pannonia from the east and southeast at about the same time the Germans invaded the northwest. By the mid-6th century the Bavarians had occupied Tirol, and the Alamanni had settled to the west. The Slavic peoples were split into northern and southern groups by Avars and Bavarians contending for control of the Danube River valley. The Avars left only superficial traces in the country, but the Slovenes built settlements in the depopulated valleys of the Eastern Alps. The Germans finally overwhelmed the Slovene settlements, which could not depend on a continuous stream of new settlers. In a few areas of what are now Kärnten and Steiermark the Slovenes managed to establish permanent settlements.

B. Medieval Era

During the 8th century, after fratricidal strife among the Germans, the Franks secured the throne of Bavaria. Fighting continued during that century between the Avars and the Bavarians in the Danube River valley. At the end of the century Charlemagne devastated the territory of the Avars and established a series of outposts (military districts) of the empire in the country between the Enns and Raab rivers to serve as buffer territories against further encroachment from the east. One of these outposts was the Ostmark (Eastern March), which later became known as Ost Reich (Eastern Country) or Österreich (Austria). Other marches in the east and southeast were Carantania and Carniola, and later Steiermark. These marches, however, were too weak to hold back intrusions from the east.

The Magyars, a nomadic people migrating slowly from the east, advanced easily along the Danube River valley until they were finally defeated by the German king Otto I at Augsburg in 955 in the Battle of the Lechfeld. Otto I revived the Eastern March and gave the more influential title of margrave to its administrator; these moves marked the emergence of Austria as a political entity. The boundary of the Eastern March was slowly extended eastward until in the early 11th century it reached what is now called Moravia. The margrave of Austria was subordinate to the duke of Bavaria, whose domain included this march. The main function of the margrave was the defense of the march and the outlying areas, and for that purpose the margraves enjoyed exceptional power. Between 976 and 1246 the Babenberg rulers of Austria contributed much to the growth of the march. They built cities and roads, encouraged trade, and enhanced their prestige by participation in the Crusades.

The death of the last Babenberg was followed by a period of trial and unrest. King Ottokar II of Bohemia occupied Austria, Steiermark, and Carniola during his reign from 1253 to 1278. His power was opposed by Rudolf I of Habsburg, who was elected Holy Roman emperor in 1273. In 1278 Ottokar was defeated in battle by Rudolf's forces and slain. By 1283 most of the former domain of Ottokar had come under the rule of Rudolf's son Albert I.

C. Austria Under the Habsburgs

The rise of Austria is closely linked to the house of Habsburg. During the 14th and 15th centuries the Habsburgs increased their holdings in the eastern part of the Holy Roman Empire. Archduke Rudolf IV proclaimed the indivisibility of Habsburg hereditary possessions, which corresponded roughly to the modern republic of Austria. From 1438 until 1806 (except for 1742-1745), the archdukes of Austria held the title of Holy Roman emperor.

During the reign of Emperor Maximilian I from 1486 to 1519, the Habsburg empire became a great power, as its territory expanded because of several advantageous marriages. His own marriage to Mary of Burgundy brought a large part of that territory into the empire. He also arranged the marriage of his son Philip (later Philip I of Castile) to Joanna, daughter of Ferdinand V and Isabella I, thus establishing the Habsburg claim to Spain and its possessions in Italy and the Americas. Philip's son Ferdinand I married into the ruling house of Bohemia and Hungary and became king of Bohemia in 1526. Ferdinand's brother Charles had become Holy Roman emperor as Charles V after the death of Maximilian in 1519.

Charles combined under his rule the inheritances of his grandparents; Habsburg hereditary lands in Austria; the Low Countries; and Spain and its possessions. The extent of the Habsburg empire proved impossible for one monarch to rule. In 1521 and 1522 Charles gave Ferdinand lands in Austria and part of Germany. Division of the Habsburg dynasty into Spanish and Austrian branches was completed when Charles abdicated in 1556 as king of Spain in favor of his son Philip II and, in 1558, as Holy Roman emperor in favor of his brother Ferdinand.

C.1. Civil and Foreign Wars

The Reformation quickly gained ground in the Holy Roman Empire, including Austria. Charles V had fought Reformation on religious and political grounds. His struggle to preserve religious unity as a basis for Habsburg power led to war within the empire, which then became entwined with wars against France and the Ottoman Empire. The Peace of Augsburg (1555) brought some respite by establishing limited religious toleration in Germany for Lutherans and Roman Catholics based on the principle that each ruler had the right to determine his religion and that of his subjects. This settlement was respected by the Habsburgs until Ferdinand II, an uncompromising champion of the Counter Reformation, attempted to reimpose Catholicism on his subjects. The Protestants in Bohemia rebelled in 1618, thus beginning the first phase of the Thirty Years' War. After the rebels deposed Ferdinand in 1619, this internal Austrian conflict grew into a European war, fought mainly on German soil. The Habsburgs were defeated in battle, and the Peace of Westphalia (1648) weakened their control over the Holy Roman Empire by reducing it to a loose union of independent states.

A serious conflict arose in the 1680s when the Ottoman Empire agreed to help Hungarian rebels against Habsburg rule. The climax came in 1683, when Vienna was besieged by the armies of Ottoman Grand Vizier Kara Mustafa Pasha. The city was rescued by an army of Poles and Germans under the Polish king Jan III Sobieski. The imperial armies won major victories near the end of the century, led by Prince Eugene of Savoy, who drove the Ottomans out of Hungary.

In 1700 Charles II of Spain died without an heir. He left Spain, the Spanish Netherlands, and his possessions in Italy to Philip, duke of Anjou, a grandson of Louis XIV, king of France. Holy Roman Emperor Leopold I, a Habsburg from the Austrian line, claimed these lands for his son Joseph I; this led to war (see Spanish Succession, War of the). At the end of the war Philip was recognized as Philip V, king of Spain, but Austria gained control of the Spanish Netherlands and Spanish possessions in northern Italy.

In 1713 Holy Roman Emperor Charles VI promulgated a so-called Pragmatic Sanction, which declared his possessions indivisible and hereditary in both the male and female line of the House of Austria. This was the first fundamental law common to all Habsburg lands and was intended as a foundation for their gradual integration. Its unifying character was weakened in Hungary, which accepted it only after Charles confirmed the Hungarian constitution and autonomy, in effect strengthening Hungarian separatism. Most European monarchs pledged to accept the Pragmatic Sanction in return for various concessions, but they repudiated their pledges in 1740 when Charles died, leaving no male heirs.

C.2. Enlightened Despotism

In accordance with the Pragmatic Sanction, Charles's eldest daughter, Maria Theresa, who in 1736 had married Francis, duke of Lorraine, ascended the Habsburg throne. (In 1745 Francis became Holy Roman Emperor Francis I, but his wife remained the power on the throne.) Maria Theresa's ascension and rival claims to Habsburg dominions led to war (see Austrian Succession, War of the) and culminated in the Seven Years' War (1756-1763). As a result Austria lost most of Silesia, economically the best developed province of Bohemia, to Prussia. This spurred reforms in imperial administration, finance, education, and the legal system; lightened the burdens of the serfs; and reduced the authority of the nobility.

Maria Theresa's son, Joseph II, motivated by the ideas of the Enlightenment, abolished serfdom altogether; improved civil and criminal procedures; decreed religious toleration and freedom of the press; reformed the Roman Catholic Church by removing its control over secular matters; and tried to centralize imperial administration. His reforms aroused widespread opposition. At the time of his death, Hungary and Belgium were in full revolt, and there was unrest in the Austrian hereditary lands and Bohemia. Joseph's brother and successor, Leopold II, revoked most of the reforms and was forced to recognize Hungary as a separate unit of the Habsburg lands. Even so, Joseph's reign had regenerated the monarchy and opened it up to European trends. During the era of enlightened despotism, Austria acquired part of Poland by joining with Russia and Prussia in the partition of that country.

C.3. Warfare with France

From 1792 to 1815 the Habsburg Empire was involved almost continuously in warfare, first in the French Revolution and then in the Napoleonic Wars. The French rebels' democratic and nationalistic ideas were a threat to the absolutist Habsburgs, who were drawn into the conflict after Leopold II was succeeded by his reactionary son, Francis II, in 1792. Austrian military involvement began with a successful Austro-Prussian invasion of France, then faltered when the French forces drove the invaders back across the border and, during the winter of 1794 and 1795, conquered the Austrian Netherlands. In 1806, after Napoleon's conquest of most of Germany, Francis dissolved the Holy Roman Empire. In anticipation of this move, in 1804 the monarch had declared himself Francis I, hereditary emperor of Austria. It was not long before Napoleon's fortunes turned, however, and Austria was part of the coalition that drove him into exile in 1814. Francis's power and territory were to some extent restored by the Congress of Vienna in 1815. Although Austria lost some territories in Belgium and southwest Germany, it gained Lombardy (Lombardia), Venetia, Istria, and Dalmatia. The diplomatic skill of Austrian chancellor Prince Klemens von Metternich made the Habsburg Empire the center of the new European order. Austrian influence in both the German Confederation, which replaced the Holy Roman Empire, and the Holy Alliance, was at a peak.

C.4. Revolution of 1848

From 1815 to 1848 the course of the Austrian Empire, directed by Metternich, was essentially dedicated to preserving the status quo. The empire was still basically rural, although significant industrial growth had taken place since the late 1820s. Nationalism became entwined with the problems of social change; the pressures were heightened by peasant discontent. In March 1848 a rebel movement in Vienna forced Metternich to resign. The revolution quickly spread as Germans, Magyars, Slavs, Italians, and others turned against the imperial regime. Ferdinand I abdicated in December, and his 18-year-old nephew, Francis Joseph I, began a reign that would last until 1916. The new emperor promulgated a constitution for Austria that set up a parliamentary government and emancipated the peasants from feudal burdens. Italian rebels took over the government in Milan, and Hungary declared itself all but independent, bound to the empire only through its Habsburg monarch. In addition, a constitutional assembly drew up a plan for the administrative organization of the empire along national lines.

The revolutionary forces soon were weakened as the goals of different social classes and nationalities clashed. The Habsburg armies defeated the Italian rebels and, with the help of conservative Russia, crushed the Hungarian rebellion. Francis Joseph dropped all liberal pretensions. He abolished constitutional government and rejected the plan for imperial reorganization along national lines. The only reform that survived was the abolition of serfdom.

C.5. Austrian Losses

In the 1850s Austria faced the problems of protecting the empire from nationalism, especially in Italy and Prussia, and from Russian advances into the Balkan Peninsula. During the Crimean War (1853-1856) Austria threatened to intervene on the side of England and France if Russia did not evacuate the Romanian principalities of Moldavia and Walachia. After the Russians complied in 1854, Austria occupied the territories until the end of the war. The prolonged conflict ruined Austria's finances, however, and its longtime ally Russia became an enemy, supporting the anti-Austrian policies of France and Prussia.

After a war that broke out in 1859, the kingdom of Piedmont-Sardinia expelled Austria from the Italian Peninsula, gained Lombardy, and created the kingdom of Italy. After this defeat, the emperor tried to strengthen his government by promulgating a limited constitutional system, which satisfied none of the opposition groups.

Austria fared no better in its struggle with Prussia for supremacy in Germany. The Prussian chancellor, Prince Otto von Bismarck, was determined to eliminate Austria from German affairs and bring about the unification of Germany under Prussian leadership. The climax was reached on the battlefield of Sadowa (1866) with a Prussian victory. The German Confederation was dissolved and Prussia took the lead in the reorganization and eventual unification of Germany. In addition, Austria lost Venetia to Prussia's ally, Italy (see Seven Weeks' War).

D. The Dual Monarchy

After the war, in 1867, Emperor Francis Joseph was forced to come to a compromise (German Ausgleich) with the Hungarian nation, represented by the nobility. The compromise gave Hungary its own constitution and a nearly independent status. After 1867 the empire was known as Austria-Hungary, and popularly referred to as the dual monarchy. Austria and Hungary were separate states, each with its own constitution, government, parliament, and language. The Magyars predominated in Hungary while the Germans had a privileged position in Austria. The two states were linked by a single monarch, who was emperor in Austria and king in Hungary, and by common ministers of foreign affairs, war, and finance.

The 1867 compromise inspired movements for autonomy among other national groups within the empire. Besides Magyars and Germans (about 10 million each), the empire as a whole was also home to nine major nationalities: Czechs, Poles, Ruthenes (Ukrainians), Slovaks, Serbs, Romanians, Croats, Slovenes, and Italians. About 6.5 million Czechs living in Bohemia, Moravia, and Austrian Silesia made up the largest, most advanced, and most restless minority. All efforts of the national groups to achieve autonomy were stymied by Hungarian determination never to alter the political structure created by the compromise.

The constitution of 1867 regulated the political system in the Austrian half of the dual monarchy until 1918, but its liberal provisions were restricted in practice. Voting was tied to property qualifications, for example, and the aristocracy retained considerable influence. The ministers were responsible to the emperor, who had emergency powers to govern without parliament. As Austria experienced significant economic growth, there was increased social conflict, stronger national movements, the rise of mass political parties, and virulent anti-Semitism. From the 1880s political life was dominated by conflicts among the various nationalities.

Alongside the negative features of Austrian political life there were some solid achievements. Under Vienna's mayor, Karl Lueger, a program of “municipal socialism,” including the building of hospitals, schools, and parks, made the city among the most progressive in Europe. Vienna was also the scene of extraordinary artistic and intellectual innovation.

D.1. Alliance with Germany

The establishment of the German Empire in 1871 led to reorientation of Habsburg foreign policy toward the Balkan Peninsula. The intention of the foreign minister, Hungarian Count Gyula Andrássy, was to preserve the status quo. Adopting a policy of friendship with Germany, Andrássy promised that Austria-Hungary would not interfere in German internal affairs; in return, Germany backed Austro-Hungarian attempts to limit Russian influence in southeastern Europe. When Russia defeated the Ottomans in 1878, Austria-Hungary, supported by Germany and Britain, intervened to prevent the Russians from seizing all Ottoman possessions in Europe. The Congress of Berlin (1878) restricted Russian acquisitions; it also permitted Austria-Hungary to administer the Ottoman provinces of Bosnia and Herzegovina. In 1879 Germany and Austria-Hungary signed a formal alliance; with the addition of Italy in 1882 it became known as the Triple Alliance. From its inception, this alliance—the mainstay of Austria-Hungary's international position—was dominated by Germany, which subordinated Austria-Hungary's foreign policy interests to its own.

Serbia, made independent of the Ottoman Empire by the Congress of Berlin, was a satellite of Austria-Hungary until 1903, when new leaders came to power intent on unifying all the South Slavs in the Habsburg monarchy, including Bosnia and Herzegovina, into an enlarged Serbian state. In 1908, after a revolution in the Ottoman Empire, Austria-Hungary annexed the two provinces. The Serbs, backed by Russia, protested vehemently. Only Germany's support of Austria-Hungary prevented war. By the time Serbia emerged from the Balkan Wars victorious and territorially enlarged, Austro-Hungarian leaders were convinced that war with Serbia was inevitable.

D.2. World War I

On June 28, 1914, the heir to the Austro-Hungarian throne, Archduke Francis Ferdinand, and his wife were assassinated in the Bosnian capital of Sarajevo by Gavrilo Princip, a Serbian nationalist. After receiving German assurances of support, the Austro-Hungarian foreign office sent a harsh ultimatum to the Serbian government, holding it responsible for the assassination and requiring its total acceptance of Austria-Hungary's demands within three days. Despite a conciliatory reply that accepted all but two of the demands, and mediation efforts by the European powers, Austria-Hungary declared war on Serbia on July 28. Germany's declaration of war on Russia and France in early August transformed the conflict into World War I.

Austro-Hungarian military activity during the first year of the war was concentrated against Russia and Serbia. In May 1915 Italy, which had declared its neutrality in 1914, left the Triple Alliance and entered the war on the side of the Allies. The Austro-Hungarian army suffered many setbacks, and the monarchy, weakened by decades of internal dissension, began to disintegrate after the death in 1916 of Francis Joseph I. He was succeeded by his grandnephew, Charles I of Austria. In 1917 the new emperor failed in several secret attempts to achieve a separate peace with the Allies, angering the Germans in the process. At the same time representatives of the Czechs, Poles, and South Slavs set up organizations in the Allied countries to gain sympathy and recognition. By late 1917 nationalist activities made the monarchy increasingly untenable.

During the spring and summer of 1918 Austro-Hungarian forces were defeated on every military front; shortages of food and other necessities triggered strikes and demonstrations at home and mutinies in the army and navy. Recognizing that the collapse of the monarchy was inevitable, the nationalist groups within the empire organized national councils that acted like separate governments. The South Slavs, meeting in Zagreb on October 7, 1918, advocated union with Serbia, and on October 28 the Czechs proclaimed an independent republic in Prague. On October 31 the Magyars had a revolution that initiated the creation of an independent Hungarian republic. On November 3, Austria and Hungary each signed an armistice with the Allies. On November 12 Charles relinquished all part in the administration of the state and left Austria. Within days Austria and Hungary declared themselves republics.

E. The First Austrian Republic

The Austrian Republic came into being as a disorganized and impoverished state of some seven million people. The dissolution of the monarchy deprived Austria of the industrial areas of Bohemia and Moravia and ended the large internal market created by the union between Austria and Hungary. German-Austrians desired union with the new German Republic, but this was forbidden by the peace treaties of Versailles and Saint-Germain. The new constitution (1920) created a federal state, with a bicameral legislature and a democratic suffrage.

Economic reconstruction took place with the aid of outside agencies. Between 1919 and 1920 U.S., British, and Swedish organizations provided food to relieve the desperate situation. Rising inflation heightened the country's distress, and in 1922 Austria appealed for help to the League of Nations. The league arranged for a large loan to prevent economic collapse. In return, Austria pledged to remain independent for at least 20 years. The deflationary policies that were a condition of the loan caused much economic hardship and unemployment, but Austrian finances slowly stabilized.

The internal political situation remained uneasy because of antagonisms between Socialist-dominated Vienna and the conservative provinces. On July 15, 1927, the Socialists organized mass demonstrations in Vienna to protest the acquittal of three members of a right-wing group, who were on trial for killing two people during a clash with the Socialist Schutzbund (Defense League). The Palace of Justice was burned, and about 100 people were killed when police fired on the demonstrators.

E.1. Fascism and Anschluss

A succession of federal governments, dominated by the conservative Christian Social Party, could not overcome either the continuous unrest or the economic misery of the Great Depression. The rise of Austrian Nazism (see National Socialism) became a new destabilizing factor. Faced with his party's declining electoral strength and growing opposition from the left and the extreme right, the Christian Social chancellor, Engelbert Dollfuss, dissolved parliament in 1933 and ruled by decree. Backed by the army and the Heimwehr (Home Defense League), a Fascist paramilitary organization, in February 1934 the government crushed the Socialist opposition. Later all political parties were abolished except the Fatherland Front, which Dollfuss had created to unite the conservative forces. In April he introduced a constitution that did away with parliamentary government and vested control in the executive. Dollfuss was killed in July during an attempted Nazi putsch (takeover). Under the new chancellor, Kurt von Schuschnigg, the regime drifted on, weakened by internal rivalries but sustained by promises of Italian dictator Benito Mussolini to maintain the status quo. His guarantee lasted only until the Rome-Berlin Axis was established in 1936. Schuschnigg soon reached an agreement with Adolf Hitler that acknowledged Austria as “a German state.”

When Schuschnigg called for a plebiscite on Austrian independence in 1938, Hitler demanded and received his resignation. The Anschluss (annexation) was accomplished when German troops entered Austria on March 12, and a Nazi government was formed, headed by Arthur Seyss-Inquart. Austria, now called the Ostmark (Eastern March), was divided into seven administrative districts under the central authority of the German Third Reich.

E.2. World War II

In October 1943 the chiefs of state of the United States, Britain, and the Union of Soviet Socialist Republics (USSR) signed the Moscow Declaration, which proclaimed the reestablishment of an independent Austria as one of the Allied war aims. Soviet troops liberated the eastern part of Austria, including Vienna, in April 1945. A provisional government headed by the Socialist leader Karl Renner was recognized by the Western occupation powers in October. National parliamentary elections were held in November, with ten parties participating. The Austrian People's Party (similar to the prewar Christian Social Party) won 85 of a total of 165 seats in the Nationalrat, the Socialists won 76 seats, and the Communists won 4 seats. In December both houses of parliament elected Renner president of the republic. A coalition government, with the People's Party leader Leopold Figl as chancellor, was then formed.

E.3. Allied Occupation

In the meantime Austria had been divided into four zones of occupation controlled, respectively, by the United States, France, Britain, and the USSR. Vienna was similarly divided. By the terms of a June 1946 agreement, the Austrian government received qualified authority over the entire country, including the right to legislate and to administer the laws. The occupation powers retained authority on matters such as demilitarization and the disposal of German-owned property. German economic assets in each zone were assigned to the respective occupying power. Laws passed in 1946 and 1947 eliminated Nazi influence from public life, but former Nazis without criminal records were allowed to participate in general elections in 1949.

The Austrian government faced immediate problems that severely taxed its limited powers. The war had shattered industry and disrupted agricultural production and transportation and communication systems. The people of Austria had suffered much, including starvation. The first task of the Figl government was to institute a relief program. The United Nations Relief and Rehabilitation Administration (UNRRA) made major contributions, and by mid-1947 the danger of starvation had ended. The economic recovery was greatly facilitated after 1948 by United States aid given under the European Recovery Program. By 1951 industrial production had exceeded prewar peaks; it continued to rise in the succeeding years.

E.4. Restoration of Sovereignty

The most significant event in the postwar era was the restoration of Austrian sovereignty in May 1955, after long negotiations that had begun in 1947. The main issue between the USSR, on the one side, and the United States, Britain, and France, on the other, was the future of Germany. The Soviets would not give up their strategic position in Austria unless Germany was “neutralized.” Among other issues were Soviet claims to German-owned property in Austria and Yugoslav territorial claims. Finally, in exchange for Soviet concessions Austria promised “...not to join any military alliances or permit any military bases on its territory.” The four Allies and Austria signed the State Treaty on May 15, 1955, formally reestablishing the Austrian republic. The treaty prohibited Anschluss between Austria and Germany, denied Austria the right to own or manufacture nuclear weapons or guided missiles, and obligated Austria to give the USSR part of its crude oil output for years to come. The United States, Britain, and France gave up any claims on German assets, and in August the USSR relinquished control of the Austrian oil fields, 300 formerly German-owned enterprises, and 97,200 hectares (240,000 acres) of land. All occupation troops were withdrawn by October, and the legislature adopted a constitutional provision pledging Austrian military neutrality. In December Austria became a United Nations member. Six years later, in 1961, Austria completed payment to the USSR of $150 million for former German businesses.

F. The Second Republic

From 1945 until 1966 Austria was governed by a coalition of the Socialist and People's parties. The number of positions each party received depended on its share of votes in parliamentary elections. This framework was extended to the economic sphere, as the state, industry, labor, and agricultural interests developed a partnership and created a modified market economy. Prosperity rested in part on nationalized industries, such as electric power plants and oil refineries; the government also controlled the banks. A new Austrian national consciousness developed based on shared experiences of wartime devastation, reestablishment of national sovereignty, successful reconstruction of the country, and the international prestige gained from Austria's unique position as a bridge between East and West.

The coalition weathered occasional differences and the loss of prewar and wartime leaders. President Renner died in December 1950 and was succeeded by the Socialist Party leader, Theodor Körner. While Socialist candidates were elected to the presidency (until 1986), the People's Party supplied all the federal chancellors until 1970. Elections to the Nationalrat in 1956, 1959, and 1962 resulted in little change in the relative strength of the two main parties. In 1957 Austria became embroiled in a dispute with Italy over the status of Austrians in Trentino-Alto Aldige (South Tirol), which had been under Italian rule since 1919. The settlement finally reached in 1969 called for implementation of a 1946 agreement guaranteeing the linguistic and cultural rights of the German-speaking Austrian population.

In 1960 Austria became a signatory to the pact establishing the European Free Trade Association. The government announced in July 1961 that it would seek an association with the European Economic Community (EEC) that was compatible with its military neutrality. The initial Socialist Party opposition to participation gradually waned, and in 1972 Austria signed a bilateral free-trade agreement with the EEC.

The coalition government broke down in October 1965 because of a budget dispute that eventually forced the resignation of Chancellor Joseph Klaus. However, his party gained a small majority in the Nationalrat elections of March 1966, allowing Klaus to form the first People's Party government in the Second Republic.

F.1. The Kreisky Chancellorship

The Socialists won a narrow electoral victory in March 1970, which for the first time made them the largest party in the Nationalrat. Lacking a majority, however, Socialist leader Bruno Kreisky tried, but failed, to form a coalition with the People's Party. In May he was appointed chancellor and formed the first Austrian all-Socialist cabinet, supported in the Nationalrat by the smaller Freedom Party. In the 1971 elections the Socialists received an absolute majority of 93 seats and were able to govern alone. The Kreisky era was marked by modernization and a dramatic increase in the standard of living for people in all social classes. Many social and labor reforms were introduced. Kreisky's foreign policy initiatives gave Austria a position in international affairs far beyond its size. Despite his popularity and achievements, opposition developed around environmental issues, financial scandals, proposed tax increases, and especially the building of a nuclear power plant near Vienna. When antinuclear forces won a narrow victory in a 1978 referendum, the government was forced to abandon the nearly completed plant. Kreisky resigned in 1983, after the Socialists lost their absolute majority in the Nationalrat.

F.2. New Problems and Opportunities

The new Socialist chancellor, Fred Sinowatz, formed a coalition with the Freedom Party; however, the alliance collapsed in 1986 when the Freedom Party took a sharp turn to the right under its new leader, Jörg Haider. Mismanagement and layoffs in the public sector coupled with controversy over privatization fueled discontent with the government, the Socialists, and the political patronage system. The presidential election in 1986 was won by the People's Party candidate, Kurt Waldheim, former secretary general of the United Nations, despite allegations that he had lied about his actions in the German army during World War II. The vote reflected the ambiguous attitude of many Austrians toward their country's Nazi past.

After parliamentary elections in November, Chancellor Sinowatz resigned and Franz Vranitzky, another Socialist, took office, forming a coalition with the People's Party. His government had to deal with continuing cutbacks in the public sector, high budget deficits, and international unease over Waldheim's election. The coalition survived the elections of October 1990, but lost seats to the right-wing Freedom Party. In 1991 Waldheim announced that he would not seek reelection the following year, and the Socialist Party changed its name to the Social Democratic Party. Thomas Klestil, a career diplomat and former ambassador to the United States, was elected president in 1992, partly on the promise to press forward Austria's application to join the European Union (EU). In 1994, five years after it was first submitted, Austria's application to join the EU was endorsed by the European Parliament and approved by Austrian voters in a nationwide referendum. The country officially joined the EU on January 1, 1995.

In the October 1994 parliamentary election, the ruling coalition of the Social Democratic Party and the People's Party retained a legislative majority but lost 23 seats. It was the worst showing by the coalition since 1945, reflecting rising dissatisfaction with the government's direction. The Freedom Party, which advocated greater restrictions on Austria's ethnic minorities, continued to make gains, winning a total of 42 seats in the Nationalrat. In October 1995 the ruling coalition collapsed over a budget dispute. In December the Social Democratic Party won elections once again, and in March 1996 it reunited with the People's Party to form a new government. In January 1997 Vranitzky resigned as chancellor and leader of Austria's Social Democratic Party. He was succeeded in both positions by Finance Minister Viktor Klima.

In April 1998 Thomas Klestil was elected to another six-year term as president. He received more than 63 percent of the vote, the second best showing ever in a presidential election in Austria.

G. Strained Relations

As the October 1999 Nationalrat elections approached, Jörg Haider's right-wing Freedom Party continued to gain in popularity. Haider, an outspoken opponent of immigration and the EU, won support among working-class Austrians by arguing that both posed dangerous threats to Austrian jobs. He also gained international notoriety for praising aspects of Germany's former Nazi regime, remarks for which he later apologized. In the October elections, the Freedom Party won 52 seats in the Nationalrat, which tied them with the People's Party. After coalition talks broke down between the People's Party and the Social Democratic Party, which won 65 seats, the People's Party agreed to form a coalition with the Freedom Party. The new government took office in February 2000, with People's Party head Wolfgang Schüssel replacing Viktor Klima as chancellor. Haider did not join the government, choosing instead to retain his post as governor of the southern Austrian province of Kärnten (Carinthia).

International response to the Freedom Party's inclusion in the government came swiftly. Austria's partners in the EU immediately downgraded diplomatic relations with Austria by halting high-level official contacts. Norway, which is not an EU member, also ceased top-level contacts with Austria. Israel recalled its ambassador. Several European governments cancelled contracts with Austrian firms or urged tourist boycotts. The United States implied that official contacts would be limited. Within Austria, numerous street demonstrations in Vienna called for the leadership to step down. In the face of this outcry, Haider resigned as Freedom Party leader on February 28. In September 2000, after seven months of diplomatic isolation, the EU unconditionally lifted the sanctions against Austria. A joint statement issued by EU member states said the sanctions had served their purpose by sending a political signal, but warned that the influence of the Freedom Party on Austria's government remained grounds for serious concern.

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