863.00/10–1349: Telegram

The Minister in Austria (Erhardt) to the Secretary of State

confidential

1383. In conversation reflecting general satisfaction People’s Party leaders with election results, Gruber confirmed that coalition would continue with Figl as Chancellor and Schaerf Vice Chancellor.

He anticipates that negotiations with Socialists will not be “too difficult” as few changes are expected other than abolition of Ministries of Food, Economic Planning and Electricity and Power. He understands Socialists are considering replacing Helmer, and said People’s Party will probably replace Kolb. Negotiations between two [Page 1235]parties have now begun, but new government will not be formed until after Socialist convention October 28.

Re coalition, Gruber said People’s Party was definitely opposed to inclusion of League of Independents in government, and that Schaerf had told him yesterday Socialists were similarly opposed. Obviously recognizing vital importance Socialists’ dominance of labor, Gruber reiterated view, frequently expressed by People’s Party leaders as well as Socialists, that coalition would be essential at least for next few years. He admitted that People’s Party leaders were already having to contend with inclination of local leaders in Styria and Carinthia to form state-governments with League and exclude Socialists, but insisted that this idea would be rejected.

Other sources agree that present coalition will probably continue unchanged. Socialist leaders, while bitterly critical of People’s Party tactics in smearing Socialists in campaign against People’s democracies, and still too depressed by their losses to give much thought to future, say they are entirely willing to continue cooperation on present basis as long as People’s Party avoids drift to right. Since moderate candidates of People’s Party generally made better showing in elections than Right-wingers, it can be hoped that influence of former will predominate in party councils.

Reports are current, however, that Right-wingers, while sharing party view against inclusion of League of Independents in federal government, are prepared cooperate with [another?] Austrian group to extend granting them participation in administration of nationalized industries and other minor government jobs. It may be difficult also to exclude League entirely from state governments in Western Austria where they made strongest showings. Such cooperation, however, unless concurred in by Socialists in advance, would undoubtedly place additional strain upon coalition.

Therefore, although logical outcome of election results should be increased cooperation of moderate elements of two major parties in progressive government program, extremists in both camps possess possibilities of exerting disruptive influence.

Erhardt