Period of tensions (1927-1938)
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Important events took place during this period:
1927 → there was a shooting between Schutzbund (paramilitary formation controlled by the Social Democratic Party of Austria) and Frontkämpfer (Association of Veterans of the Front, a right-wing alliance that includes the rich industrialists and the Catholic Church) in Schattendorf that ended with the life of a man and a boy.
In the trial for the murders the jury acquitted the defendants Frontkämpfer pleading self-defense which infuriated the working class.
This produced a massive protest march on July 15, as it was not possible to restore order, the chancellor, Schober, mobilized the units of the army. As a result, 89 protesters were killed and more than 600 seriously injured.
In protest, the Social Democrats proclaimed a national strike for July 16, but the government overcame it.
1931 → Failure of the Austro-Germanic Customs Union plan.
1934 → Dollfuss the Austrian chancellor is shot.
1938 → Germany absorbs Austria. “Anschluss”
POLITICS
In the country there were two major political forces:
- The Christian Socialist Party
- The Social Democratic Party.
The persistent world economic crisis and the internal political tensions favored Austrofascism, for which a small Austrian Nazi party was created, which supported the union with Germany.
In 1933, Chancellor Engelbert Dollfuss (leader of the Christian Socialists, who argued that Austria remained independent of Germany) dissolved the Parliament, suspended the democratic constitution of 1920, and ruled by decree, hoping to control the unrest.
In 1934 a Civil War detonated, so Dollfuss established an authoritarian corporate state along the fascist lines. That same year, Germany organized a Coup (which failed) to get the country united to the German Third Reich, where Chancellor Dollfuss was assassinated.
The internal crisis and the weakness of the Austrian Government facilitated the invasion of German troops in 1938, not resisted by the European powers so Austria was declared part of the German Reich. This German annexation “Anschluss”, was approved in a plebiscite that was manipulated to show that 99% of the Austrian population wanted union with Germany. In the plebiscite, neither Jews nor Gypsies were allowed to vote.
After this, the Germans quickly extended anti-Semitic legislation to Austria.
ECONOMY
During the 1930s, Austria was marked by food shortages, unemployment, financial scandals, and, consequently, growing political instability.
The Austrian economic situation had begun to deteriorate in 1929, driven by The Great Recession that had a negative effect on the fragile Austrian economy and its financial system. Thus, several banks went bankrupt (the dismemberment of the Austro-Hungarian Empire and the inflation’s increase of the postwar period had weakened the Austrian banking system).
The acquisition of the Bodenkreditanstalt (the main Austrian bank) by the government in 1929 provided momentary stability. However, the economy continued to deteriorate, with unemployment reaching up to 15% in 1930. Until the late 1930s, however, the country achieved to conserve both his gold and currency reserves, although he was very dependent on short-term foreign credits.
The first consequence of the Austrian bank's bankruptcy was the depreciation of the shilling (austrian currency) when the savers tried to buy foreign currency to secure their money. The bankruptcy of the Bodenkreditanstalt and the subsequent national financial crisis induced the failure of the Austro-German Customs Union plan, even before the Permanent Court of International Justice declared it incompatible with Austrian international obligations.
The Austro-German Customs Union was a project designed by Germany and Austria in 1930 and 1931 that eliminated tariffs among them, although for countries that opposed this goal it was a first step for the political union of the two countries.
SOCIAL
In the early 1930s the threat to the Jewish population of Austria intensified, culminating in a cultural, intellectual and human tragedy.
During the Night of the Crystals in 1938, Jews were attacked throughout Germany and Austria. Many synagogues were destroyed; homes and businesses were looted. After that, Austrian Jews began to be imprisoned in Nazi concentration camps.
