By Francois Murphy
VIENNA (Reuters) - Even if Austria's far-right party fails to enter government after Oct. 15 elections, its views on immigration already have.
The anti-Islam Freedom Party's (FPO) popularity reached new heights during Europe's migration crisis in 2015 when it denounced the centrist government's decision to throw open Austria's borders to hundreds of thousands of refugees and other migrants.
It ran first in opinion polls for more than a year, with support of more than 30 percent, and its candidate came close to winning last year's presidential election.
Now the party has slipped to second or third while the Social Democrats and conservative People's Party (OVP) - the two parties in government, which have dominated post-war politics - have moved towards the far right's positions.
Most of the migrants and refugees carried on to Germany in 2015 but 90,000, or more than 1 percent of Austria's population, stayed and sought asylum. The two centrist parties have since promised to make sure this never happens again.
"Both government parties are something like FPO light," political analyst Anton Pelinka said. "They are not exactly the same as the FPO but the crossover has become very fluid."
A spat with Italy on July 4 about control of their shared border has highlighted the shift.
In the past month Italy has asked other EU countries to help it cope with a surge in the number of migrants reaching its Mediterranean shores from Africa. Concerned about another influx, Austrian Defense Minister Hans Peter Doskozil said he was preparing to take action if they headed towards Austria.
In an interview with Austria's top-selling tabloid, he said he expected border controls at the Brenner Pass, a gateway for Italy to northern Europe, "very soon". The article added that 750 soldiers and four armored vehicles were available to secure the border if needed.
Italy reacted furiously, summoning Austria's ambassador to Rome before Doskozil and Chancellor Christian Kern, both Social Democrats, backed away from the comments.
But the remarks are the latest example of how Austria's two centrist parties are trying to beat the far right at its own game.
"The Social Democrats and the OVP are in a kind of race to see who can take issues away from the Freedom Party," Pelinka said. "They are hurting the Freedom Party with this. Precisely because of this, it has fallen in the polls."
The OVP and its 30-year-old leader, Foreign Minister Sebastian Kurz, have taken the lead in opinion polls.
Kurz has focused on immigration and integration since taking over as party leader in May, calling for migrants rescued in the Mediterranean to be taken to Africa rather than Europe.
His positions and language are sometimes so close to the FPO's that the far right party has accused him of plagiarism.
When Kurz said last month that he wanted to do away with Muslim kindergartens, which he and the FPO describe as breeding grounds for "parallel societies" at odds with the rest of Austria, the FPO said it had been making the same demand for years, and Kurz lacked the "will and courage" to carry it out.
Chancellor Kern's Social Democrats (SPO) have opposed Kurz on that issue, but Kern put forward a plan on Wednesday to "take back control of migration" and cut arrivals from Africa sharply by 2020. He also oversaw a law-and-order drive this year that included a ban on Muslim face-covering veils.
Kern's emphasis has, however, been more on employment and the economy. He has pushed for measures that would favor local workers over foreign rivals, including a tax break for firms that fill newly created posts with people registered as unemployed in Austria.
While Kern's approach is more targeted than the sort of national preference the far right calls for, it is testing the limits of freedom of movement under European Union law, and the measure has yet to be approved by Brussels.
Even though some stigma around the FPO itself remains, it has found new acceptance within the political establishment.
The center-left SPO has opened the door to forming a national coalition with the far right, lifting a self-imposed ban of 30 years.
Parties rarely obtain a majority in Austria's proportional electoral system, and almost always need a coalition partner to form a government. The SPO and OVP have governed together for most of the past 70 years but they are now at loggerheads, making them less likely to join forces again.
"The (FPO's) chances of joining the government as a junior partner are the highest they've been in more than 10 years, but the chances of coming first and securing the chancellor's job are very, very slim," political analyst Thomas Hofer said.
"For months now the party has seen its ideas implemented and now they face a dilemma because if they go further and become more extreme they could lose voters."
With parties like the FPO having made electoral gains across Europe, the diplomatic fallout from it entering government is likely to be more limited than in 2000, when its alliance with the OVP prompted the European Union to impose sanctions.
And there is no sign that Austrian foreign policy, towards Italy or other neighbors, will become any less assertive.
"There are now strong populist parties in France, Germany, the Netherlands," a senior SPO official said on condition of anonymity. "It's no longer a phenomenon that only affects Austria. We can deal with them more confidently."
(For a graphic on 'Austria's far right' click http://fingfx.thomsonreuters.com/gfx/rngs/AUSTRIA-POLITICS-FARRIGHT/010041ZS4BF/AUSTRIA-POLITICS-FARRIGHT.jpg)
(Editing by Anna Willard)