Austria: class polarisation on the rise

The aggressive policies of the Austrian bourgeoisie and its government are increasingly forcing different sectors of society, including the working class, into the arena of struggle, while feeding a permanent atmosphere of racism and nationalist hysteria. After half a year of strikes, a mass demonstration and several huge protests, where do we stand now?

The government, which was sworn in a year ago, for tactical reasons avoided the implementation of its true programme until after a series of regional elections. But since June 2018, the bourgeoisie commenced a relentless wave of brutal attacks on the living conditions of the masses.

In July, the government re-introduced the 12-hour-day/60-hour-week in a fast-tracked parliamentary assault. This major roll-back of working conditions and trade union rights was followed by the slashing of social security for employed workers and their families. The law was passed in the last parliamentary session before Christmas. This counter-reform hands control of healthcare and pension contributions by private employees (at the moment, €62 billion a year) over to big business.

The introduction of a “fast-lane, first-class system” for ambulance patients starting this year points to the eventual introduction of a paid-for system (and the need to buy private insurance) for medical treatment. Medical services for employed workers and their families are currently predominantly free.

Kurz Image Flickr United NationsKurz managed to lead the crisis-ridden conservative party to a stunning election victory in October 2017 by whipping up a wave of racist hysteria / Image: Flickr,United Nations

Meanwhile, a series of counter-reforms are in the making to unemployment insurance, as well as welfare cuts for the poorest. The supposed aim of this reform is to force people into the labour market by threatening to seize up to €4,200 of their “wealth” and “property” (excluding basic household appliances, and the means of transport needed to get to work or access medical care). This measure is particularly cruel, as most people who receive this welfare money are either chronically ill, elderly people with low pensions, single parents or children.

The labour office has also got a target of forcing 9,230 unemployed people from the cities to go and live with big farmers and hoteliers in the countryside and mountainous regions. Meanwhile, in agriculture, the 12-hour day has been re-established as the standard working time.

The next step will be a tax reform that gives out money to the capitalists, by lowering corporation tax from 25 to 20 percent (although the number of exemptions already lowers the overall tax burden on corporations to 22 percent). However, at the same time, the bourgeoisie claims there is little room for lowering income tax, value added tax or other regressive taxes. A squeeze on tenant’s rights is also in the pipeline.

The only major issue the government has not broached yet is another reform to the pensions system, but the bourgeois media propagandists are already declaring that the social right of a decent pension is “unfinanceable”.

The government has clear ideas and plans about how to increase the profits of the ruling class at the expense of the working class. Its programme is a mix of items to serve the interests of different sections of the capitalists. And the ÖVP – which has been in federal government for 47 years since 1945 – is a well-oiled tool of the capitalists’ state apparatus, tied by a thousand threats to the big corporations.

The government is employing combined tactics with these counter-reforms. First, it took control of workers’ social security system, behind the figleaf of squeezing out the overpaid “red bureaucracy”. As a next step, they are lowering social security contributions, thus nominally increasing disposable income. The new social security managers are all hand-picked by the bourgeois, and on a much higher salary than the previous union staff. These measures have created a deficit in the social contribution system, which will be used as an excuse to privatise the best assets of the system. In order to fill the gaps in medical services, the government will bring in private insurance, probably starting with accident insurance. It is not a coincidence that the finance minister is a manager at a major insurance company.

The bourgeois bloc

The government of Sebastian Kurz (ÖVP) was formed as a coalition of the traditional party of the Austrian bourgeoisie (the conservative ÖVP) and the nationalist-populist FPÖ. Several factors prepared this vicious coalition. First of all, a year-long conflict in the conservative party was decisively settled in favour of the wing of the bourgeoisie opposed to class collaboration, and the integration of social democracy into the state apparatus. The big bourgeoisie nurtured and promoted their stooge, the current Chancellor Kurz, to take the conservative party on the offensive, and go for early elections. Kurz managed to lead the crisis-ridden conservative party to a stunning election victory in October 2017. He did so by whipping up a wave of racist hysteria, connecting the malaise in society to the refugee crisis of 2016. This poster boy of the Raiffeisen-Banking group was also styled as the man who could save the country by giving it a firm lead into the “modern era”.

Meanwhile, the bourgeoisie pressured the nationalist FPÖ to take steps to form a viable government with the conservatives. The FPÖ has been anchored only superficially to the bourgeoisie and its state apparatus so far. This party proved to be the weak link in the first black-blue governments of 2000-2006. Then it became the main sacrificial lamb of the austerity government, which led to a crisis and a split in the party. Its party structures are dominated by reactionary academic fraternities, whereas its electoral support draws in voters from all popular layers of society, from the conservative petit-bourgeoisie to angry working-class voters, including union members.

The leadership of the FPÖ is now doing its utmost to conquer a stable base in the bourgeoisie through getting a stake in the state apparatus. In the past year, we have seen a month-long power struggle in the state apparatus of the interior ministry. The new Minister for Interior Affairs, the FPÖ’s main strategist Herbert Kickel, conducted a hard manoeuvre to break the conservative dominance over the police apparatus. This power struggle led to the collapse of the secret service agency, and an open clash between the bureaucracies of the interior and interior ministries. What in “normal” times would lead to a veritable state crisis, has been covered up on this occasion. This is yet further proof of the big capitalists’ intentions to use this government to push back the organised working class and its integration in the state apparatus. The bourgeoisie is willing to give the FPÖ a share of the state apparatus in exchange.

Heinz Christian Strache Image Gregor TatschlDespite the reactionaries and fascists in and around the FPÖ, it is an ordinary, right-wing bourgeois party, which works within the framework of bourgeois democracy / Image: Gregor Tatschl

As a precondition for its much-desired conquest of state power, the FPÖ leadership accepted a number of demands from the capitalist class, first and foremost to give up any polemics against EU membership. This was easy to concede, as it was little more than rhetoric anyway. Still, anything that comes close to a critique of “Europe” is impermissible for big capital, given the general instability of world affairs. Also, the party dropped its demagogic demands to introduce elements of plebiscite rule into the constitution, in the form of binding popular consultations. The party leader, HC Strache, also does his utmost to distance himself from the openly racist and pro-fascist notions of party functionaries.

The stinking nest of reactionaries and fascists in and around the FPÖ does not determine the party’s character. At base, it is an ordinary, right-wing bourgeois party, which works within the framework of bourgeois democracy. Still, these reactionaries around the FPÖ are not welcomed by the capitalists, because of the international repercussions of allying with these characters, and also in order not to provoke the deep-rooted antifascist sentiments in society.

The coalition government is the spearhead of a bourgeois bloc that comprises all relevant sectors of Austrian capitalism. Politically, it can count on the parliamentary support of the neoliberal NEOS party for all its main social counter-reforms, like the reintroduction of the 12-hour workday/60-hours work week. Another nice asset to this bourgeois bloc is the liberal-green President of the Republic, who went to Israel to beg its government to give up its traditional boycott of FPÖ ministers. We note that the Marxists of Der Funke were the only political force on the left not backing him in the 2016 elections, not even as the lesser-evil against now Minister of Infrastructure, Norbert Hofer.

The media is propping up the government, by defending and promoting its programme. The government is also clearly working in tandem with the main bosses’ associations and think tanks. The attacks on labour laws, collective bargaining and the actions of the bosses in individual companies and industries are all pointing in the same direction: pushing back the social rights and undermining the collective strength of the working class.

The bourgeoisie can also rely on the Catholic Church, in the personage of Archbishop Schönborn and the conference of bishops, who have given their blessing to austerity, and a nationalist slant to the “Christian virtue of compassion.”

Economic growth and rising exploitation

The years of 2017 and 2018 marked the first clear period of economic recovery. Since the crisis of 2008/09, unemployment soared to 9.1 percent in 2016, but has been falling since the second half of 2016 in all categories and age-groups. The industrial reserve army of labour is still more than double that of pre-crisis levels, with more than 300,000 people out of work. Still, employers mourn the“scarcity of labour”, which should read as the scarcity of labourers willing to sell themselves for conditions and wages currently offered. Since 2010, industrial labour productivity increased 20 percent per hour. Except for the past two years, this rising productivity was not based on investment in machinery, but mainly on the brutal squeezing of the working class. Meanwhile, in the public sector, there are thousands of unattended posts due to austerity, leaving the remaining workers in a permanent limbo.

This is a highly profitable situation for the capitalists. The leading industrial complex, the steelmaker voestalpine, increased its return on investment from 10.8 percent in 2011 to 15.2 percent last year, and is striving for a rate of profit between 17 and 18 percent in the coming period, which it deems necessary to meet the demands of the financial market.

The social democracy and union bureaucracy did their utmost to increase the profitability of capitalists in Austria by keeping real wages stagnant for more than two decades. In 1995, a worker could save on average 15 percent of their income. Now, this figure is down to an average of 6.4 percent. Before social welfare and benefit payments (mainly for children), 43.4 percent of the overall population are categorised as poor or at risk of poverty. After the state support is factored in however, this rate sinks to 14.4 percent. This explains the significance of the government counter-reforms to the future lives of working-class people.

It is clear that the temporary relief of a very sluggish “recovery”, which never reached the homes of working families, was the signal for the bourgeoisie to kick the labour bureaucracy out of the state apparatus. After organising and providing a political cover for the bank bailouts (the final costs of which will amount to €15bn) and austerity policies, the social democracy shyly asked for some concessions for the masses, considering the booming economy. At the very least, they have questioned the need for such dramatic counter-reforms. Empirically speaking, they are right: Austria’s federal budget will balance with a surplus for the last financial year; employment is soaring, and so are tax incomes. If the projections are correct, the Republic will meet all Maastricht-criteria in the coming years without any further cuts.

But the bourgeoisie calculates differently. They understand the general instability of the world economy and the vulnerable situation of the export industry. Austria’s main source of growth is based on exports to Germany and the German car industry to the east, and the ongoing exposure of Austrian Banks to Eastern Europe and the Balkans in particular. The main bank, Raiffeisen, derives 50 percent of its profits from the Russian market alone: hardly a comforting situation for a person of sense. The bourgeoisie therefore see the “boom” for what it is: a temporary easing on the economic front, which they must use to increase profits through severe counter-reforms to labour’s conquests of the past.

The unions’ strategy fails

The union federation ÖGB held his three-day congress last June. While its new leader, Wolfgang Katzian, held his inauguration speech (in which he literally stretched out his hand to the government and bosses’ associations) two conservative backbenchers moved a motion through parliament to re-establish the 12-hour day. After some wavering and backroom debates (which is the usual way of dealing with disagreements in workers’ organisations that have been shaped by decades of class-collaboration and state involvement) the union decided to mobilise for a mass demo on 30 June.

This call did not fall on deaf ears, and more than 100,000 demonstrators turned out onto the streets of Vienna. There was big pressure to move immediately towards strike action, as was revealed in shop-stewards conferences organised in all regions of the country. But the union leadership restricted the outburst of anger to a parliamentary strategy. The result was that, when the law was to be voted on in early July, another hastily tabled motion fast tracked the 12-hour day to 1 September, instead of January 2019. So the eight-hour day, one of the big conquests of the 1918 revolution, did not to live to see its 100th birthday, even under the “democratic” rule of the bourgeoisie.

In the autumn, the annual collective bargaining of the metal sector (the most important collective treaty, which serves as the spearhead of social conquests) was set to take place. The union leadership thus promised to organise a “hot autumn”, in which all that had been taken by law would be won back through new time regulations in the collective contracts. As summer passed and autumn set in, it became clearer every day that the union leadership had caught itself up in bureaucratic maneuvering, with one section of the bureaucracy accusing the other of acting as a brake on a general offensive against the government's attacks. Their withdrawal from their pre-summer promises were hidden behind the usual empty rhetoric.

At least the tops of the metalworker, railway and brewery unions seemed to have established a united front. This front in itself would have been more than enough to start a serious coalition of strike action, which could have broken the bosses’ and government’s initiative by a movement of joint struggles, drawing in other sectors of the working class. Even before the strikes by the metalworkers and the railway workers were called, more than 60 percent of the overall population declared their support for strike action, and this popular support increased when the strikes took place.

The bosses showed extreme aggression towards the shop stewards and union officials who conducted the negotiations and organised actions, while at the same time withholding any attack on working hours and conditions in the factories in order not to provoke the workers further. The idea was to leave a space for more collaborationist sectors of the shop stewards to keep out of the movement. The bosses achieved a split in the metal union, where they managed to frame the fight as being driven by only one section. This is the so-called “metal technic” (FMTI) branch of the industry, mainly constituting machinery building, making tools and operating furnaces. This sector is the biggest, with more than 120,000 workers in well over 1,000 factories. But the real strength of the metal sector lies in the steel industry, with its huge factories and strong union traditions.

Also, the energy, mining, and car assembly factories basically abstained from struggle. So the union called for a series of factory meetings, and then warning strikes in just one sector of the metal industry, where the bosses are organised in the so-called FMTI Association. This call was eagerly taken up by workers, with strikes in around 240 factories, more than in the strike movement of 2011. Based on this, an agreement with the bosses was struck, resulting in an average wage increase of 3.5 percent, which was considered by most of the workers a good achievement, as it is their highest pay rise since 2011.

But besides this achievement, there is nothing to cheer about. The movement revealed that the most important collective contract is de facto broken, as just one section of the metal industry fought for it. The logic of the shop stewards in the steel sector, who drew back from a joint fight with co-workers in the other metal sectors was: “our industry is more productive than the rest, and on our own we achieve better results by maintaining good relations with our management, which we don’t want to antagonise with strikes.” Adding to this short-sighted, reformist logic, they add: “we have maintained an attitude of solidarity for too long, now we must look after ourselves and bargain for higher wages based on our better productivity”.

Another sector that was forced into strike action was the railway workers. Here, the union-busting policies of the management were particularly aggressive. They offered a wage increase of 3 percent as a “voluntary” gift, but refused to sign a contract with the union representatives. The union did all it could to escape an open conflict, but in the end was forced to call for a two-hour warning strike in November. This strike was a complete success, as workers brought all the trains to a total standstill, even if the union did nothing to properly organise the action, hoping for an agreement at the last minute. Based on the strike, they managed to achieve a wage increase of 3.45 percent.

Union leaders give a dishonest balance sheet of the movement in autumn. They focus on the wage increases (which were warmly welcomed by workers after years of income stagnation), but overlook the new regulations for contracts in all sectors, which mean the 60-hour week is set to be re-established as the norm in one factory after the other. All the anger and fighting spirit of the workers, expressed in the mass action of 30 June, and the dynamic strike movements, was misdirected by the union leaderships and the majority of the shop stewards into a fight for the right of the top layers of the movement to represent the working-class in negotiations with the employers and the state.

Demos and activism

The strike movement of the working class will take a break for now, and will probably resume in early February, when the public sector workers enter into their negotiations. But this does not mean there is calm on the streets of the country. Since the autumn, there have been weekly demos in Vienna against the government. These weekly demos spread to other cities, including Linz, Graz and Innsbruck. Also, in the region of Vorarlberg, there are weekly demos every Sunday morning. Local demos are popping up in smaller cities, which do not get any media coverage, even if they involve hundreds of people. Many of these demos are expressing a deep rage against the racist policy of deporting migrants living and working in Austria, but take up more general political questions too.

An important expression of this growing polarisation along class lines was the big demo of 15 December, in which up to 50,000 demonstrators went onto the street in Vienna. The left formed a united front at this demonstration, involving social democratic front organisations (socialist youth and socialist students, but also the union fraction that was pushed by a grassroots initiative into joining the demo), the Stalinist left, women's organisations, Greens, sects, an independent section and also the revolutionary Marxists.

MSF Austria demo Image Der FunkeUnder the hammer blows of the bourgeois bloc, coupled with the deep international crisis of capitalism, the youth and the workers will need to make steps forwards / Image: Der Funke

The main speakers at the final rally were from the social democratic tradition. Julia Herr, leader of the YS, took an open left-reformist stand, arguing that the government should be defeated in a coming election, and pointed out the importance of the upcoming European elections, in which she is a candidate. She combined this political perspective with the struggle for socialism at a later stage. The leader of the railway workers, Roman Hebenstreit, who just struck an agreement with the bosses a few weeks earlier, grumbled about the current government and those in the early 2000, called for an alliance of unions and “civil society”; and called for workers and youth to join unions with his main slogan: “membership is resistance”.

As we can see, the dominant forces in the opposition movement refuse to pose the perspective of a fight to bring down the government in an open struggle. Instead, they want to orientate the movement somehow to survive until a later stage, where a government can be formed with social democratic participation, and class relations can turn back into a cosy social partnership.

But this perspective is wrong from the start to the finish. First of all, it means that, in the face of a full-scale assault on social conditions, the unions are channelling working-class anger into symbolic gestures and even symbolic strikes. Secondly, the “good old times” will not come back, even if the leadership wants them to. In the epoch of capitalist crisis, this is ruled out. And there is yet another problem: without a perspective of properly fighting the government and bosses to the end, these organisations cannot win back the trust of the masses. This type of fatalism is therefore a self-fulfilling prophecy.

A few words on the social democracy

The former leader of the social democrats, Christian Kern, left his post over a bureaucratic intrigue in the inner party circles in September.

He imposed on the party a liberal-bourgeois programme through a public speech in January 2017. But even this right turn could not convince the conservative party to uphold the coalition with the social democrats. However, the former party leader had big personal ambitions after he was voted out of office. His idea was to form a social-liberal political coalition in the EU by linking up with Macron, Tsipras and Renzi to install him as the coming President of the European Commission. This notion of personal grandeur (even if expressing the genuine concern of the bourgeoisie in the coming European elections) collapsed into nothing, and now he is back in the economic department of the bourgeoisie.


His successor is a handpicked career-bureaucrat named Pamela Rendi-Wagner, who joined the party only after she was chosen as a minister by Kern in 2017. She is very unfamiliar with the party and keeps it on a hard, liberal course. Still, she got 98 percent of the vote in the last national emergency congress in November. But this monolithic result is not the expression of any enthusiasm, not even amongst the remaining party activists. Under the pressure of the aggressive right-wing government, the decisive power-centres in the party (the Vienna branch of the party, the union fraction and few others) took on a compromise candidate to halt the crisis in their own organisation. But this new leader is no solution at all. Despite the aggressive policies of the bourgeoisie, the social democracy is trapped in a never-ending crisis. It is not a surprise, therefore, that it is the reformists who are hit by the crisis of capitalism hardest. Their policies of smoothening the edges and divisions of a society that is breaking into pieces are lacking a sound material basis in society. On this basis, in Austria’s highly polarised society, the left and the working-class lack any political expression for their aspirations, or their determination to fight the government.

But under the hammer blows of the bourgeois bloc, coupled with the deep international crisis of capitalism, the youth and the workers will need to make steps forwards, and this process is underway. The economic boom, which in the post-war period allowed capitalism to buy social peace by giving concessions, is long gone. The new class fighters will need to be harder and more uncompromising than previous generations.

This understanding sets the revolutionary Marxists apart from the rest of left and working-class organisations in general. In contrast to any other political forces, the supporters of the IMT are deeply optimistic about the future of our class. We do not limit ourselves to the narrow view that we are witnessing a process of endless destruction of past conquests. We also understand that the crumbling of the old will inevitably give way to fresh forces for our class, which will surge into the arena of struggle.

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