By the spring of 1927 democratic institutions seemed to have secured a relatively firm footing in Austria. That appearance was deceptive. The same year saw the beginning of the deterioration of Austrian democracy.
The achievement of a secure democratic political environment by 1927 appeared grounded in reality. Within eight years after the Austrian Social Democrats had quashed the threat of a Communist-inspired Soviet republic in Austria, the bourgeois-dominated democratic government had succeeded in building up a reliable police force, gendarmerie, and army adequate to protect it against any internal threats. Rent as it was by the endless power struggles of its leaders, the Heimwehr was still only a relatively weak force on the political horizon. The National Socialist Party, split into quarreling factions, amounted to little more than a noisy opposition group. With the marked improvement in the Austrian economy by the mid-1920s, Austrian anti-Semitism had noticeably declined by the end of 1926. Perhaps most important of all, the foreign financial assistance assured by the Geneva Protocol of 1922 and the subsequent economic stabilization measures under-taken by the government did much to put the country's financial house in good order.