Who should rule Russia the president or the legislature?

On the answer to that question hangs not only the future of Russia's uphill experiment with capitalism and democracy but also the peace of mind of Moscow's neighbors.As reform-minded Boris Yeltsin and the reactionary Russian Congress engage in this historic power struggle, the conflict is fraught with enormous hazards - including some that could be felt far beyond the country's borders.

If the Congress had kept its word, the dispute would have been settled through a public referendum. But, displaying open contempt for the will of the people, the Congress reneged on the agreement and this week started whittling down Yeltsin's powers. He could easily end up only as a figurehead or get ousted entirely.

Short of an increasingly unlikely compromise, the alternatives are ominous.

If the communist-packed Congress prevails, the prospect is much worse than just an end to Yeltsin's economic reforms and a continuation of the bungling in which the legislature encouraged the central bank to print excess rubles, fueling hyper-inflation.

Worse yet, these anti-Yeltsin forces want to halt nuclear disarmament, try to reclaim the Soviet empire and start making trouble in a variety of international hot spots.

Seeing the possible handwriting on the wall, Yeltsin has been asking foreign leaders for support in case he tries to prevail by declaring a state of emergency and suspending the Congress. Such a move would make it hard for other nations to provide more aid to Russia and would set a dangerous precedent for future Russian presidents who might not be as freedom-minded and friendly to the West as Yeltsin.

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The situation is fraught with a variety of nightmarish possibilities, including coup, assassination or intervention by the military. Even continued deadlock between Yeltsin and the Congress would mean more inflation, more shortages, and an increasingly restive populace.

If the Congress cared more about Russia's welfare than it did about its own power and privileges, it would get in step with Yeltsin. But even with such cooperation, Russia would still face a long struggle against entrenched bureaucrats, rampant crime, corruption, social inertia and a mind-set alien to freedom and capitalism.

At best, then, Russia faces many years of stagnation and will need large infusions of outside aid. At worst, even a partial return to the Cold War would sink America's plans to return to fiscal responsibility by making big defense cuts.

Consequently, the Clinton administration had better move Russia right to the top of its priority list and start reviewing its options on how to deal with a variety of potential changes in Moscow.

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