Austrian Rightist’s Party Makes Strong Election Gains : Europe: Governing coalition loses two-thirds parliamentary majority as Haider’s Freedom Party gets 23% of vote.

The party led by a right-wing populist who once praised the work ethic of Nazi Germany won 23% of the vote in Austria’s federal elections Sunday, handing two moderate parties that have governed for four decades their worst setback since World War II.

The charismatic Joerg Haider and his Freedom Party remained in the No. 3 spot in what will be a five-party Parliament, but their strong showing deprived the governing coalition of the Social Democrats and the conservative People’s Party of the two-thirds majority it has always enjoyed.

Most disturbing for the established political parties of this placid, alpine nation of 7.5 million was the post position Haider has staked out for the 1998 federal campaign--a vote that could put the telegenic 44-year-old in the chancellor’s seat if current political trends continue.

Haider, confident and smiling, thanked his supporters and set their sights on the leadership in 1998. He also ventured the opinion that the two parties that have dominated Austrian politics since this nation regained its postwar independence in 1955 would split up even before their new four-year term is finished.

Haider is expected to try to exploit disaffection among the conservatives of the People’s Party, luring them into a coalition with his rightists and against the Social Democrats, whom he has cast as politically stagnant and corrupt.

Chancellor Franz Vranitzky, appearing on Austrian television, looked shaken by what he termed “certainly poor results,” and the general secretary of his Social Democratic Party, Josef Cap, described the voting as “a clear defeat.”

Vranitzky was expected to be nominated for a fourth term as chancellor, and the current coalition is likely to be reconstituted, because the two leading parties can cobble together the simple majority needed to govern.

But influential conservatives like Foreign Minister Alois Mock have lately hinted they might one day side with Haider to drive the leftist Social Democrats into opposition.

Even as a third-party force in the 183-seat Parliament, the Freedom Party with its 42 seats now will be able to assert broad influence over this nation’s policies with its vital swing vote on constitutional issues that require a two-thirds majority to pass.

The governing coalition parties commanded 75% of the previous Parliament, but their strength now drops to about 63%, requiring the support of one or more of the polarized opposition parties on key issues like Austria’s expected Jan. 1 entry into the European Union.

The leftist Green Alternative party also gained at the expense of the established parties, boosting its 4.8% share in the Parliament to 7%.

Vranitzky’s Social Democrats lost the most to the resurgent smaller parties, dropping from nearly 43% of the votes in the last federal election to slightly more than 35%, with 66 seats.

The People’s Party also fell in the vote spread, getting only 28% and 52 seats, in comparison with 32% of the votes in 1990.

In his eight years as Freedom Party leader, Haider has taken his xenophobic following from obscurity to the threshold of power. He has shown himself to be adept at overcoming setbacks, such as his vocal opposition to joining the European Union before a June referendum that gave 66% endorsement to Austria’s proposed membership.

He lost a provincial governorship in 1991 amid the scandal that followed his remark that certain aspects of the economic and industrial policies of Adolf Hitler were to be admired.

But his ranting against the influx of foreigners, whom he accuses of taking jobs that would otherwise go to Austrians, has won him burgeoning support in this country, where cradle-to-grave social security has begun to erode.