By Noah Barkin and Michael Shields
VIENNA (Reuters) - Appearing to make light of the Holocaust would be the kiss of death for most European politicians, but for Austria's Heinz-Christian Strache it has meant little more than a temporary dip in his popularity.
The 42-year-old leader of the Freedom Party has bounced back in opinion polls after a barrage of criticism in January for reportedly likening attacks on him and his backers to treatment of the Jews in Nazi Germany.
Speaking to Reuters from his office overlooking parliament, the dark-tanned former dental technician denounced the whole affair as a political plot against him and said he was confident heading into an election next year, when nearly one in three voters could reward his party for its opposition to euro zone bailouts and a tough stance on immigration.
"We are ready to take responsibility and play a role in government," said Strache, who took over as head of the Freedom Party in 2005 after longtime leader Joerg Haider jumped ship to head a splinter party. "But I think we can only break the hold on power of the ruling coalition if we emerge as the strongest party."
More than two years into the euro zone's debt crisis, parties opposed to the bloc's rescues of weak southern member states have gained ground in countries including Finland and the Netherlands, but none have wielded enough power to stop the bailouts or arrest the momentum towards closer economic integration.
Strache is one of the few politicians in Europe with a chance of changing that.
With the slogan "Our money for our people", he has won over voters by denouncing the bailouts of debt-laden euro states like Greece as thinly disguised rescues of the very banks that caused the crisis in the first place.
He lists Braveheart, the Mel Gibson film about William Wallace's effort to free Scotland from English rule, as an inspiration because it fits with his vision of Europe as a grouping of distinct fatherlands.
At the top of his policy wish list is more "direct democracy" in the form of Swiss-style referendums, a shift his critics say would give Strache greater scope to push his populist views.
"If people think no one is listening to them and they aren't participating in the decision-making process, then societies become more radical," Strache argues.
He has worked hard to shed the extremist image the party developed under the charismatic Haider, who was regularly accused of anti-semitism and xenophobia, but led Freedom into a national coalition with the centre-right People's Party in 2000.
Haider died in a car crash in 2008, leaving Strache as the undisputed leader of the Austrian right.
Sipping on a can of Red Bull and taking drags from a cigarette, he rejected the far-right label for his party and talked about his visit to the Yad Vashem Holocaust memorial in Israel. He also cited efforts to broaden his party's focus on international themes, for example by offering to host a conference on Syria attended by its opposition figures.
The furor over his comments at a ball in Vienna in January threatened to undo a long drive for respectability that had helped vault the party into pole position in some opinion surveys last year.
Guests entering the ball were shouted down and spat at by anti-extremist protesters. Once inside, Strache compared that treatment to the Nazi "Reichskristallnacht".
"We are the new Jews," he told fellow attendees, according to an undercover reporter from Der Standard newspaper.
Austria's Jewish community condemned the comments as "monstrous", and support for the Freedom Party, and for Strache, fell.
Less than two months after the incident, however, the party has rebounded, and experts say it could even beat the ruling parties - the Social Democrats and People's Party - in next year's vote.
"You can't exclude Freedom emerging as the top party," said Wolfgang Bachmayer at pollster OGM, who believes popular misgivings about euro zone bailouts, resistance to new Austrian belt-tightening measures and a wave of headlines about public sector corruption could all work to Strache's advantage.
If Freedom were to come out on top and the ruling parties fall short of a majority, Strache's influence over policy could grow significantly, turning Austria into a much less predictable partner in Europe.
Strache's office is dominated by two big red-and-white Austrian flags.
Half a dozen large pictures of him hang on the walls, including a series where he is shown against a greyish-blue backdrop with clenched fists and raised arms. A bronze bust of Strache by Austrian sculptor Carlo Wimmer bears a resemblance to Julius Caesar.
On his desk is a large container of Powerbar Creatine, a product the company describes as a "muscle maximizer for explosive power".
Two books are prominently displayed; "Finanz Mafia" by Wolfgang Hetzer about criminal bankers avoiding punishment, and "Germany Does Away With Itself", a controversial 2010 tome that warned of a Muslim takeover of German society and cost the author, former social democratic politician Thilo Sarrazin, his job at the Bundesbank.
After speaking at length about the folly of the euro and predicting a break-up of the currency bloc into northern and southern blocs, Strache turns to another one of his favorite subjects - immigration.
Roughly 1 million foreigners live in Austria, making up 11 percent of the overall population, compared with about 9 percent a decade ago. Over a third are citizens of other EU countries, nearly 300,000 came from the former Yugoslavia and just over 100,000 are Turkish citizens.
Strache praised Sarrazin's book and warned that if policymakers failed to act soon, there was a risk that sharia law could be introduced across Europe.
"We are seeing violence against women, forced marriages, forced circumcision, honor killings, developments that take us back to the Middle Ages," he said.
"We need to be very careful because of our demographic situation. There are estimates that if we don't take steps to counter it, Europe will have a Muslim majority among its younger population by 2100."
On his website www.hcstrache.at supporters can listen to the "HC rap", where he warns to a thumping beat about "Islamists on the march" and "terror gangs" threatening Austrian children.
They will also find proposals to ban the construction of minarets and Islamic centers, ban the public wearing of headscarves, withhold tax money for Turkish schools, and strip family aid for those who won't learn German.
A poll this week for newspaper Oesterreich showed that roughly half of Freedom's supporters back the party specifically because of its hostility to foreigners. A narrow majority of Austrians think the Freedom Party won't make it into government next year, but 36 percent expect it to rule.
(Additional reporting by Angelika Gruber; Writing by Noah Barkin; Editing by Will Waterman)