The alliance between Austria's conservatives and the far right in the heart of Europe is an ominous turn of events as the beleaguered continent looks at its immediate future.
Its positions on immigration differed little from the Freedom Party's, which built its reputation on such national populist planks. It finished third in the election, with 26 percent of the vote.
In the new government, the Freedom Party will hold six ministries, including the red-button foreign, defense and interior portfolios, ensuring that it will be a powerful partner to the People's Party in the administration.
Another complication: Austria will hold the EU's rotating presidency in the second half of next year when the Union is expected to pass seminal reforms.
Modern European conservatism, like that of German Chancellor Angela Merkel's Christian Democratic Union (CDU), constitutes an essential bulwark against national extremists across Europe -- when they steadfastly refuse to bend to the far right's demagoguery or to rule in tandem with them.
Today Europe's fate lies disproportionately in the hands of its conservative parties -- and their decision on whether to collaborate with or exclude nationalist extremists.
Enlightened conservatism, such as that across most of western Europe, offers traditionally minded, often religious, better-off burghers a viable political home in liberal democracies.
Western Europe's conservative parties, whether in Sweden or Spain, are patriotic and proud of their country, but their understanding of the nation is open-minded, not based on genealogy -- or closed to non-Christians.
They believe firmly in an integrated EU and on cultural issues -- such as women's rights, gay rights and ethnic diversity -- have come a long way since the Cold War years.
Germany's CDU is a classic modern Christian democratic party, which has categorically ruled out a coalition with the Alternative for Germany (AfD) -- Germany's far-right Islamophobic party. It rejects even teaming up with the rightists to pass certain legislation.
In the summer election campaign, Angela Merkel refused to borrow from the racist vocabulary of the AfD -- which had seen its popularity grow across Germany over the past four years -- before it entered the Bundestag this year with 12.6 percent of the vote.
Obviously, there's a strain of German voter that responds to the racist, anti-immigrant tropes of the AfD, which blames foreign nationals and refugees for crime, terrorism and abusing social welfare. But Merkel -- though she has cut down the numbers of refugees entering the country since the 2015-16 crisis -- has stuck to her guns that Germany will continue to take in refugees and respect the right to political asylum.
By pledging not to enter coalitions with the AfD, the CDU -- along with with every other mainstream German party -- has signaled that the likes of the AfD do not belong in the liberal democracy that Germany has forged since the war ended.
In stark contrast to Merkel, the People's Party and Sebastian Kurz mimicked the far right's bigotry in the election campaign and will now run a government with the Freedom Party.
As prime minister, Kurz's deputy will be Heinz-Christian Strache, the head of the Freedom Party. Strache, who was involved in a neo-Nazi movement as a young man, now disavows radicalism, and has suspended party members for extremism -- including for making the straight-arm Nazi salute in public
According to the parties' coalition contract, plans to toughen migration-related policies will be put into motion at once.
Austrian authorities will dispossess asylum seekers of their cell phones and all of their cash upon arrival in Austria, the former in order to read all saved data in the name of state security, the latter in order to pay for the upkeep of refugees waiting to have their asylum cases heard.
Kurz's short-sighted opportunism lends the far right and its illiberal ideas a stamp of legitimacy, signaling to Austrians and the rest of Europe that a party like the Freedom Party has a rightful place in our modern democracies.
Obviously, Austria is not the only country who sees it this way: in contrast to the storm of protest unleashed during Austria's first conservative-far right government in 2000 -- which included EU sanctions against Austria -- there has so far been a critical but relatively muted response.
In other words: This is the new European reality.
Gerald Knaus, director of the Berlin-based think tank European Stability Initiative, argues that Kurz and Merkel personify the stakes for European conservatives.
"Merkel, when faced with the migration crisis in 2015, told Germans 'we can manage this,' and designed policies to do exactly that."
"But Kurz communicated it as a fundamental threat to Western culture and Europe's social welfare states. And now he entered into a coalition with a party that mobilized a poisonous Islamophobia in a country that hasn't even had an Islamist terrorist attack."
The way Kurz approaches migration, says Knaus, echoes the way Hungary's autocratic leader Victor Orban has done, not fellow Christian Democrat Merkel.
Austria's shift to the right comes at a highly inopportune moment when the crisis-ridden EU is under siege from national populists across the continent and fighting for its very survival. It sends exactly the wrong message to Austria's post-communist neighbors in Central Europe, such as Hungary and Poland, where illiberal regimes already hold power and bid to reshape the EU.
In fact, it plays right into their hands, underscoring that their visions of an ethnically homogenous Europe of nations could become the rule rather than the exception in the EU.
France's far-right leader Marine Le Pen understood Austria's new leadership exactly this way: "It is excellent news for Europe."