Allied-occupied Austria

• 1. Introduction

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  Allied-occupied Austria came into being on the 27th of April 1945, when a provisional cabinet led by Karl Renner declared independence from Nazi Germany, even as fighting still raged in the streets of Vienna. The country that emerged from that declaration was not simply liberated; it was divided into four zones, watched by rival armies, and caught between two world orders that were already shaping up to be enemies. How a nation deemed the first victim of Nazi aggression came to spend a decade under foreign rule, and how it finally won its freedom, is a story that runs through hunger, Cold War espionage, secret armies, and a single dramatic meeting in Moscow.

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• 2. The Moscow Bargain

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  At the 1943 Moscow Conference, the Soviet Union, the United States, and the United Kingdom jointly declared the German annexation of Austria null and void. Every law and administrative act imposed since 1938 was to be swept aside. The conference described the intent to restore a free and independent Austria, but it also made plain that Austria could not escape responsibility for fighting on Germany's side. That double verdict, victim and collaborator at once, would shape every negotiation for the next twelve years.

  When Soviet commander Fyodor Tolbukhin's troops crossed the former Austrian border at Klostermarienberg in Burgenland on the 29th of March 1945, Stalin had already assembled a prospective cabinet from Austrian communists in exile. A telegram from Tolbukhin changed Stalin's calculus. The Soviet commander had made contact with Karl Renner, a veteran Austrian politician living in southern Lower Austria, and recommended working through him instead. Stalin agreed, and on the 20th of April 1945 the Soviets instructed Renner to form a provisional government, all without consulting the Western allies.

  Renner's cabinet took office seven days later. One-third of the ministerial posts, including the interior and education portfolios, went to Austrian communists, and NKVD officers stood guard over the chancellor himself. The Western allies suspected a puppet state and refused to recognise Renner. Even President Harry Truman, who privately judged Renner a trustworthy figure rather than a Soviet front man, withheld recognition. Renner's strategy for maintaining independence was structural: he placed two under-secretaries in every ministry, each appointed by whichever party did not hold the top post, so no single faction could dominate a department.

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• 3. Four Zones, One City

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  On the 9th of July 1945 the four allies agreed on the borders of their occupation zones, and the resulting map divided Austria along lines that would prove consequential for nearly a decade. Vorarlberg and North Tyrol went to France; Salzburg and the part of Upper Austria south of the Danube went to the United States; East Tyrol, Carinthia, and Styria went to Britain; and Burgenland, Lower Austria, and the Mühlviertel region of Upper Austria north of the Danube went to the Soviet Union. Vienna was split among all four, with the historic center declared an international zone where occupation forces rotated every month.

  American troops, including the 11th Armored Division, crossed the Austrian border on the 26th of April 1945. French and British forces followed on the 29th of April and the 8th of May, respectively. For the first months, none of the Western allies had direct intelligence from Eastern Austria; Renner's cabinet was equally blind to conditions in the West. The first Americans did not reach Vienna until late July, arriving precisely when Soviet officers were pressing Renner to hand over Austrian oil fields. Americans objected and blocked an immediate transfer, though the Soviets ultimately secured control of oil in their zone.

  The Allied Control Council held its inaugural meeting in Vienna on the 12th of September 1945. It refused to endorse Renner's claim to govern the whole country, but it also did not stop him from extending influence westward. Renner used this ambiguity deliberately, appointing the outspoken anti-communist Karl Gruber as Foreign Minister to reassure the West, while reducing the visible footprint of communists in his reshuffled cabinet. On the 20th of October 1945, the Western allies recognized the reformed cabinet and cleared the way for Austria's first post-war election.

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• 4. Soviet Conduct and Its Costs

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  On the 4th of April 1945, the Soviet military issued a directive read aloud to all soldiers on the front lines, declaring Austria a liberated nation and ordering troops to respect civilian life, traditions, and private property. The directive described Nazi propaganda as a lie and closed with an appeal: "be merciless towards German enslavers, but don't offend the Austrian population." The Red Army had lost 17,000 lives taking Vienna. What followed the victory contradicted the directive. Soviet troops engaged in systematic violence against civilians from the first days of occupation, and repression harmed the Red Army's reputation so severely that Moscow issued an order on the 28th of September 1945 forbidding violent interrogations.

  Austrian police records for 1946 registered "men in Soviet uniform" as responsible for more than 90% of logged crimes. By contrast, American soldiers accounted for 5 to 7% of the same records. Soviet commanders tried throughout 1945 and 1946 to contain desertion and plunder, without success. The arrival of Ivan Konev's permanent occupation force only marginally improved conduct.

  The Soviets also pursued what the Austrian government later called "an economy of exploitation in colonial style." By late 1945 and early 1946, the combined occupation force in Austria peaked at around 150,000 Soviet, 55,000 British, 40,000 American, and 15,000 French troops, all funded by the Austrian state. Occupation costs were eventually capped at 35% of Austrian state expenditures. In less than a year after the war, the Soviets dismantled and shipped to the East industrial equipment valued at around $500 million. On the 27th of June 1946, they consolidated the expropriated businesses into the USIA, a conglomerate of over 400 enterprises that controlled a monopolistic share in the glass, steel, oil, and transportation sectors. The Austrian government refused to recognise USIA's legal title; the USIA in turn refused to pay Austrian taxes and tariffs. The enterprise's assets gradually deteriorated because the Soviets had no intention of reinvesting profits.

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• 5. Hunger and the Marshall Plan

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  Daily food rations in Austria remained below 2,000 calories until the end of 1947, a level American reports described as a near-starvation diet. From March 1946 to June 1947-64% of those rations arrived through the UNRRA. A drought in 1946 cut both farm output and hydroelectric power. The severe winter of 1946-1947 was followed by a disastrous harvest in 1947, when the potato crop barely reached 30% of pre-war output. On the 5th of May 1947 Vienna was shaken by a violent food riot led by communists who called for curbing the westernisation of Austrian politics. In August that year, a food riot in Bad Ischl turned into a pogrom of local Jews. Workers in British-occupied Styria launched strikes in November.

  In June 1947, the month the UNRRA ended shipments, the United States issued $300 million in emergency food aid and invited Austria to join Marshall Plan discussions. Austria finalised its Marshall Plan program by the end of 1947 and received the first tranche of aid in March 1948. Heavy industry clustered around Linz and British-occupied Styria benefited most; output in that sector climbed from 74.7% of pre-war levels in 1948 to 150.7% in 1951.

  American general Geoffrey Keyes stated plainly that "we cannot afford to let this key area (Austria) fall under the exclusive influence of the Soviet Union." The Soviet zone received only 8% of Marshall Plan financial investments, though it received 25% of physical commodities such as food. The second phase of Marshall Plan aid, beginning in 1950, focused on productivity and what historian Michael J. Hogan described as the transfer of "attitudes, habits and values... a whole way of life." According to Günter Bischof, no European nation benefited more from the Marshall Plan than Austria. Total receipts reached nearly $1 billion, alongside half a billion in humanitarian aid, and the Americans also refunded around $300 million in occupation costs charged in 1945-1946. Per capita, aid amounted to $132, compared to $19 for Germans.

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• 6. A Secret War Within the Occupation

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  The British had been quietly arming a paramilitary gendarme force, the B-Gendarmerie, since 1945, and held discussions about creating a formal Austrian military as early as 1947. The Americans feared that Vienna could become the scene of another Berlin Blockade and set up emergency food stockpiles while the government prepared a backup administrative base in Salzburg. Secretly, the American command trained soldiers of an underground Austrian military at a rate of 200 men a week.

  In February 1948, Soviet official Andrei Zhdanov vetoed a proposal by Austrian communists to partition Austria along the German model, though he expressed support for a peaceful transition to socialism. Talks on independence stalled and then approached a "near breakthrough" in 1949, only to stall again when the Pentagon concluded that Western withdrawal would leave Austria open to Soviet invasion following the Czechoslovak model. General Mark W. Clark insisted that the United States must secretly arm the core of a future military before any departure. Serious training of the B-Gendarmerie resumed in 1950 but stopped because of American defense budget cuts in 1951.

  The communists tested the occupation's stability directly in the autumn of 1950, organising general strikes that became the gravest internal threat since the 1947 food riots. Strikers stormed and occupied offices of the Austrian Trade Union Federation and disrupted railroad traffic. Neither the Soviet nor the Western occupiers openly intervened. The strikes failed to draw sufficient popular support. Despite the strain of the Korean War on American resources, by the end of 1952 a stockpile in France and Germany, code-named "Stockpile A" for Austria, had amassed 227 thousand tons of materiel designated for Austrian armed forces.

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• 7. Road to the State Treaty

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  Joseph Stalin's death and the Korean Armistice Agreement together defused the military standoff over Austria. Chancellor Julius Raab, elected in April 1953, removed the firmly pro-Western Karl Gruber and guided Austrian foreign policy toward a studied neutrality. He carefully tested Soviet interest in resuming independence talks, but until February 1955 the Soviets insisted on linking Austria's fate to the unresolved German question.

  In January 1955, Soviet diplomats Andrey Gromyko, Vladimir Semenov, and Georgy Pushkin secretly advised Foreign Minister Vyacheslav Molotov to decouple the Austrian and German issues. Their reasoning was tactical: new talks on Austria, they calculated, would delay ratification of the Paris Agreement rearming West Germany. Molotov went public with the new Soviet position on the 8th of February, setting out three conditions for Austrian independence: permanent neutrality, no foreign military bases on Austrian soil, and guarantees against any future Anschluss.

  In March 1955, Molotov clarified the terms through a series of meetings with Austrian ambassador Norbert Bischoff. Austria was no longer a hostage to the German problem. Raab was invited to Moscow for bilateral negotiations. Western diplomats suspected a trap like the one Hitler had set for Austrian Chancellor Schuschnigg in 1938. Anthony Eden and others read the Moscow initiative as a cover for renewed interference in German affairs. Raab's visit to Moscow from the 12th to the 15th of April proved the sceptics wrong. Moscow agreed that Austria would be free no later than the 31st of December. Austrians agreed to pay for the assets and oil fields the Soviets were vacating, mostly in kind. British diplomat Geoffrey Wallinger, who would sign the final treaty, reported to London that the deal "was far too good to be true, to be honest."

  On the 15th of May 1955, Antoine Pinay, Harold Macmillan, Molotov, John Foster Dulles, and Austrian Foreign Minister Figl signed the Austrian State Treaty in Vienna. It came into force on the 27th of July. The last occupation troops departed on the 25th of October. The following day, Austria's parliament enacted a Declaration of Neutrality, committing the country never to join a military alliance such as NATO or the Warsaw Pact, and never to permit foreign troops to be stationed on its territory. West German Chancellor Konrad Adenauer, the sole prominent political voice to object publicly, called the whole affair die ganze österreichische Schweinerei and threatened to send Hitler's remains home to Austria. The Soviets left behind in Vienna their large Soviet War Memorial and a symbolic cache of small arms, artillery, and T-34 tanks; the Americans left the vastly larger gift of Stockpile A.

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