Austrian Chancellor Karl Nehammer has stepped down after failing to negotiate a new governing coalition that excluded the far-right Freedom Party of Austria, the election’s controversial victor.
How inevitable was the breakdown of talks to sideline the Eurosceptic, pro-Russian Freedom Party, and what lies ahead for Austria’s political landscape? Austrian political scientist Gustav Gressel, a research fellow at Vienna’s National Defence Academy, offers his analysis in an interview with The Ukrainian Week.
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— Why did the new government coalition fail to materialise?
— The outcome of the coalition talks wasn’t set in stone. The Social Democratic Party of Austria was keen on striking a budget compromise, particularly as the regions under its control were eager to gain greater influence. Securing federal funds for their constituencies is crucial for their local success and recognition.
Having been out of power since 2017, parts of the party and its supporters feel overlooked financially. This sense of neglect has made the party’s left wing increasingly rigid, a stance that now presents significant risks to its broader prospects.
The COVID crisis and the costly green transition initiatives of previous administrations have left Austria grappling with significant budget deficits. The Social Democratic Party is pushing for sharp tax hikes, but the economy is already under strain. Bankruptcies are mounting, including high-profile names like KTM (Kraftfahrzeuge Trunkenpolz Mattighofen). Compounding the issue is Austria’s heavy reliance on the German market, which is currently facing its own challenges.
Raising corporate taxes would only deepen these economic woes. Meanwhile, the liberals are advocating for a much-needed pension reform, though it’s highly unpopular among older voters of both the Social Democratic Party and the Austrian People’s Party. The latter, in turn, wants to slash funding for green programmes and education. While such cuts alone won’t solve the fiscal crisis, they may see an opportunity to offload the political cost of pension reform onto the liberals.
— Western media suggest the Austrian president faces limited choices: either call snap elections or invite Herbert Kickl, leader of the pro-Russian Freedom Party of Austria, to form a government. Which outcome seems more likely?
— The president’s options are indeed constrained. Without a parliamentary majority for his preferred parties, he will have little choice but to accept whatever coalition emerges. While he could dissolve parliament and call snap elections, the Freedom Party of Austria recently captured 35% of the vote in Styria’s regional elections, suggesting that a fresh vote would only strengthen their position.
Meanwhile, the economic wing of the Austrian People’s Party is keen to see the Freedom Party in power, viewing them as a vehicle for economic reforms and tax cuts—akin to Elon Musk’s disruptive, no-holds-barred approach in the US. They appear indifferent to the potential fallout or risks that come with empowering such a controversial partner.
— Public opinion polls indicate that support for the Freedom Party of Austria is growing, despite its Euroscepticism, pro-Russian stance, and ties to Hungarian Prime Minister Viktor Orbán’s Fidesz party. What does this mean for Austria’s foreign policy, particularly in terms of its support for Ukraine, under a potential new coalition?
— On foreign policy, this will likely remain a secondary concern. I expect the Freedom Party of Austria will keep a low profile on these issues in Brussels, avoiding strong reactions while focusing on its domestic agenda. In this regard, they will likely mirror Slovak Prime Minister Robert Fico more than Hungarian Prime Minister Viktor Orbán.
That said, the Freedom Party’s domestic agenda will still play into Russia’s hands. In short, it will be a “crusade” of vengeance against institutions and media they oppose. They will dismantle Austria’s intelligence sector, which is still recovering from Russian subversive activities, and weaken the rule of law. The party is notably corrupt and has targeted investigative journalists exposing corruption. Russia will undoubtedly take advantage of such an environment, even if this is an unintended consequence.
