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A Grave Test for Taiwan Democracy

Mr. Chen badly mishandled last week's decision to cancel Taiwan's fourth nuclear power plant, even though the $5 billion facility is one-third built.

Worse than the decision itself was Mr. Chen's alleged misleading of the leader of the opposition Kuomintang or KMT, Lien Chan, on the issue just after Mr. Lien had met with him in an effort to agree to some cooperation. The KMT is the largest party in the legislature.

Mr. Chen's behavior to Mr. Lien has been severely criticized even by those who are not in favor of more nuclear power.

But the issues are not serious enough to warrant impeachment.

The fundamentals of the crisis lie in the uncertain relationship between executive and legislature in a constitution which has evolved very rapidly, and is still evolving. There is not the complete separation of powers that exist in the U.S. model. Taiwan's system is in principal closer to that of France, where cabinet ministers are also members of Parliament.

In Taiwan the president has less independent executive power than in France but the prime minister is his appointee.

Taiwan's misfortune is that its first change of government under its democratic system has coincided with the need for ''cohabitation,'' with a president from one party and the legislative majority from another.

Initially Mr. Chen handled the situation well enough. That was not difficult because the split in the KMT which led to Mr. Chen's victory ensured that it did not want to force an dissolution of the legislature prior to the parliamentary election due in December 2001. That would likely have meant large gains for Mr. Chen's Democratic Progressive Party or DPP and for James Soong's People First Party.

Now however Mr. Chen is faced with the possibility of a Lien-Soong front against him. Meanwhile the blurred lies of constitutional responsibility make it easy for some in the opposition to claim that Mr. Chen has acted unconstitutionally and should be impeached. This is a possibility given the composition of the legislature.

The DPP has only 31 percent of the seats while a 66 percent vote for impeachment would put the issue to a referendum. That would be a disaster for Taiwan's political stability and indeed for democratic process in the region.

The views of independents and cooler KMT heads should prevail - but there is no guarantee.

Mr. Chen's mistake arose from a desire to throw a bone to radical elements in his DPP. Pragmatism required him to retreat on Taiwan independence and a huge budget deficit thwarted promises of more health, welfare and education spending. However, he may have misjudged public sentiment on the nuclear plant.

Though cancellation was a campaign promise and the environmental issues enjoy popular support, the waste of public money involved in abandoning it at this stage is also an issue.

Whatever the outcome, the episode is a reminder of the weakness of Mr. Chen's position given the nature of the constitution, the uncertain division of powers and the fact that his DPP has a very long way to go before becoming the ruling party.

To govern effectively, Mr. Chen not only needs to compromise with the legislature, but also, given the dearth of expertise in his own party, to bringsome non-party experts into his government.

The damage from this episode will not so much be to the economy. The stock market, like most others in east Asia, has been declining for months because of a strong dollar and fears of a technology cycle downturn.

But the nuclear bungle could undermine Mr. Chen's efforts, which have only just begun, to tackle the links between organized crime, business and politics in the later days of KMT rule. The President's travails are also to the advantage of Beijing which has recently been appearing more accommodating.

While not retreating from its demand that Taiwan accept the One China principle, it has implied that it can be more flexible in interpretation.

It has also acknowledged that the Hong Kong model, One Country Two Systems, cannot be copied exactly.

At this juncture, Mr. Chen could do with some bad cop rhetoric from Beijing to distract from his own problems. He will not get it.

That said, Taiwan domestic politics usually generate more noise than heat and that should be the case this time.