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They are doing this because the green party is in the government now. This is a long-standing demand of the green party to lower CO2 emissions. They first did this in Vienna a few years ago, when they were in the city government. Now they are in the federal government and are rolling this out for all of Austria, since it was a huge success in Vienna, car travel was dramatically reduced.

You are wrong, the idea is much older and the idea for the current version (initially called 1-2-3 Ticket) was suggested by the green party in 2013 already.

More Infos in the history (in German): https://kurier.at/politik/inland/gruene-spoe-oder-oevp-wer-h...

Thats how it worked in Chicago: everyone stopped riding due to sars-cov-2, the Transit Authority started selling 1/3 price passes, ridership picked right back up.