http://edition.cnn.com/2004/ALLPOLITICS/08/31/gop.schwarzenegger.transcript/index.html
Schwarzenegger never said the Soviets were in his town. He said, "When I was a boy, the Soviets occupied part of Austria. I saw their tanks in the streets. I saw Communism with my own eyes. I remember the fear we had when we had to cross into the Soviet sector."
In other words, when they went into the part of Austria where the Soviets were, they saw the tanks. He didn't say he opened his front door and saw them.
As far as calling Austria a socialist country, I think it's justified. There was enough of a socialist influence that it could be considered a socialist country, especially if you didn't like it. It's much the same in this country. The far left thinks the Christians have taken over and will eventually strip us of our civil liberties. The far right thinks the communists sympathizers have taken over and will eventually let terrorists run through the streets of Washington D.C.