In 1947, the Austrian economy, including USIA enterprises, reached 61% of pre-war level, but it was disproportionately weak in consumer goods production (42% of pre-war level). Food remained the worst problem. The country, according to American reports, survived 1945 and 1946 on "a near-starvation diet" with daily rations remaining below 2000 calories until the end of 1947. 65% of Austrian agricultural output and nearly all oil was concentrated in the Soviet zone, complicating the Western Allies' task of feeding the population in their own zones.
From March 1946 to June 1947, 64% of these rations were provided by the UNRRA. Heating depended on supplies of German coal shipped by the U.S. on lax credit terms. Drought of 1946 further depressed farm output and hydroelectric power generation. Figl's government, the Chambers of Labor, Trade and Agriculture, and the Austrian Trade Union Federation (ÖGB) temporarily resolved the crisis in favor of tight regulation of food and labor markets. Wage increases were limited and locked to commodity prices through annual price-wage agreements. The negotiations set a model of building consensus between elected and non-elected political elites that became the basis of post-war Austrian democracy, known as Austrian Social Partnership and Austro-corporatism.
The severe winter of 1946–1947 was followed by the disastrous summer of 1947, when potato harvest barely made 30% of pre-war output. Food shortages of 1947 were aggravated by the withdrawal of UNRRA aid, the spiraling inflation and the demoralizing failure of State Treaty talks. In April 1947, the government was unable to distribute any rations at all, and on May 5 Vienna was shaken by a violent food riot. Unlike earlier popular protests, this time the demonstrators, led by the Communists, called to curb the westernization of Austrian politics. In August, food riot in Bad Ischl turned into a pogrom of local Jews. In November, food shortage sparked workers' strikes in British-occupied Styria. Figl's government declared that the food riots were a failed communist putsch, although later historians refuted this statement as an exaggeration.
In June 1947, the month when the UNRRA stopped shipments of food to Austria, the extent of the food crisis compelled the U.S. government to issue 300 million dollars in food aid. In the same month Austria was invited to discuss its participation in the Marshall Plan. Direct aid and subsidies helped Austria to survive the hunger of 1947. On the other hand, they depressed food prices and thus discouraged local farmers, delaying the rebirth of Austrian agriculture.
Read more about this topic: Allied-occupied Austria
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With eyelids heavy and red,
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Stitch! stitch! stitch!
In poverty, hunger and dirt
And still with a voice of dolorous pitch
She sang the Song of the Shirt.”
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—Freya Stark (18931993)