Jörg Haider's Legacy Corruption Scandals Shake Faith in Austrian Democracy

When the late right-wing populist Jörg Haider went into politics, he vowed to free the country of corruption. But the scandals he left behind reveal that Haider's time in office did not represent the end but the height of cronyism in the country.

Peter Schinzler/DER SPIEGEL

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The Austrian right-wing populist politician Jörg Haider and his horse-loving associate Wolfgang Kulterer were responsible for some pretty outrageous stories in their time. Now those stories are written down -- sealed and filed in A4 format, forming chapter upon chapter of an unsolved case, all carefully identified by file numbers.

It's quiet here in the courtyard behind the police headquarters building in the small town of Krumpendorf, which is located in the Austrian state of Carinthia. The offices are quiet, too, sealed off from the noise of day-trippers and the rattle of boat engines on nearby Lake Wörth. There is nothing to disturb the men of the "Soko Hypo" ("Hypo Special Commission") in their investigation into the near-bankruptcy of Carinthia's Hypo Group Alpe Adria (HGAA) bank, which even now has cost billions. Their scanners are running nonstop, search engines are going through thousands of gigabytes of data while plotters spit out organizational charts. At the center of these charts, like spiders in a web, are the suspects.

"More than 3 million pages of files -- if you piled them on top of each other, they would be 11 times as tall as St. Stephen's Cathedral in Vienna," says Lieutenant Colonel Bernhard Gaber, the head of the special commission here in its inner sanctum. "Forty-one defendants, 140 interrogations to date. We've never had this sort of thing before."

The Hypo affair is only the shiniest tile in a monumental mosaic, however. When fully assembled, it portrays the legacy of a government that came into being 10 years ago in the face of European protests, scaring away friends and appalling Austria's neighbors. Then, for a few years, it seemed to do its work quietly enough. Nevertheless, that administration apparently gave birth to a monstrous scandal involving millions in commissions that lobbyists collected during the privatization of state-owned companies, suspected party donations from the coffers of government companies, deals with Saddam Hussein's Iraq and Moammar Gadhafi's Libya, money laundering, offshore companies and questionable diaries.

A System in Jeopardy

The key figure in this tale, Jörg Haider, the former leader of the right-wing populist Austrian Freedom Party (FPÖ), is no longer alive. He died in a car accident on Oct. 11, 2008, just outside Klagenfurt, the capital of the state of Carinthia. Did Haider's death change anything, or has the daily barrage of new revelations rocked Austria's political landscape? Not so you would notice.

The FPÖ, a successful party under Haider before it split in two, managed to double its share of the votes in the Sept. 26 election in the state of Styria. And Haider's successor, Heinz-Christian Strache, could even finish in second place in the elections to the Vienna City Council and district councils this coming Sunday.

When he listens to the right-wing populist candidate Strache, he sometimes yearns for "the intellectualism of Dr. Haider," says Strache's rival, Vienna Mayor Michael Häupl, ironically. And when he sees Häupl, Strache retorts, he has the impression that to find Social Democrats of any stature these days, one would have to "visit the military graves at the central cemetery" -- where former Austrian Chancellor Bruno Kreisky is buried.

With their conclusions, both Häupl and Strache involuntarily join those who, in the wake of the most recent scandals in the Alpine republic, see a system in jeopardy. The legal preoccupation with Haider's failed "carnival regime" on Lake Wörth doesn't just offer a portrait of Haider's regiment, but also delivers a "withering assessment of this republic," says political scientist Anton Pelinka. The major parties that have run the country for decades, both the left-leaning Social Democratic Party of Austria (SPÖ) and the conservative Austrian People's Party (ÖVP), are "completely worn-out intellectually," says constitutional law expert Heinz Mayer.

A Trio of Scandals

Austria has recently been consumed by three groups of scandals, with alternating involvement of the three main political camps: the Bawag affair, a business thriller involving a trade union bank; the Buwog deal involving the sale of 60,000 government-owned apartments, for which a lobbyist and a PR advisor collected almost €10 million ($13.9 million) in commissions; and, finally, what is undoubtedly the most outrageous of them all, the Hypo Group Alpe Adria scandal, which investigators in Germany, Austria, Liechtenstein and Croatia are now looking into.

Lieutenant Colonel Gaber, in his office on Lake Wörth, probably has the best understanding of what these affairs in the recent past say about the condition of Austrian democracy. For years, the portly Tyrolean has been in charge of all major cases in Austria.

Gaber began investigating the Bawag affair in 2006. In the end, he personally escorted Helmut Elsner, the former head of Bawag, which had close relations with the SPÖ, in a Learjet from his exile in France to Vienna. It was a matter of honor, says Gaber. "After all, I used to be with the Cobra special-forces unit."

Then he turned his attention to the near-collapse of Vienna's Immofinanz, a company that bought the 60,000 Buwog apartments under conservative former Chancellor Wolfgang Schüssel. Insider information was allegedly involved in the bidding process. The Vienna public prosecutor's office is investigating former Finance Minister Karl-Heinz Grasser on suspicion of embezzlement.

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