A rabid nationalist party led by an indicted war criminal emerged as Serbia's leading political party in the December 2003 elections. It is just the latest manifestation of how badly things are deteriorating in the Balkans. European-American collaboration - successful in ending the war in Bosnia and the Serbian oppression in Kosovo, and in helping to rebuild the region - is now turning success into failure. The promise of integration into the European Union, however important, is not sufficient to change the Balkans. Unless the West stops putting off difficult political decisions or making bad ones, prospects for reversing the downward trend will remain dismal.

To be sure, resumption of major hostilities is not on the horizon anywhere in the Balkans. But that does not justify relegating the area to the backwater it has become, particularly with regard to the US government. It's not just that so much effort and treasure have been spent on trying to help produce decent, functioning states. Western policy is running the risk of creating mini-‘black holes’ in Europe where violent nationalism, crime and terrorism are rampant.

What have been the mistakes? Let's start with Serbia, the biggest player in the region.

The stench of Slobodan Milošević's rule still pervades Serbia. In no East European country undergoing a post-communist transition - not even in Russia - has the country's leader been assassinated, as Prime Minister Zoran Đinđić of Serbia was. He was killed not because he sent Milošević to The Hague for trial, but because he was preparing a crackdown on some of the criminal elements that continue to wield influence in post-Milošević Serbia.

Despite considerable Western aid and some progress, notably in economic reform, the bottom line is that Serbia is a political swamp. It remains a nationalist and quasi-Mafia state, the product of a failure by reform elements to clean house and by Western countries to face facts. The latter largely avoided putting conditions on their aid and coddled the democratic forces, repeatedly citing extenuating circumstances for their failure to deliver and turning a blind eye to their corruption.

Bizarre confederation

The West made another big mistake with its intense effort to keep Serbia and Montenegro together. By preventing the last step in the dissolution of Yugoslavia, the West sought both to stave off movement toward an independent Kosovo and to have one instead of two states for the EU to consider. It bludgeoned two real states into a bizarre confederation that does not work and likely will vanish if Montenegro is allowed to have a promised referendum on independence in 2005.

Establishing Serbia-Montenegro kept senior leaders in both countries tied up for years, reducing their focus on internal reform and wasting time and effort on the fancies of Western statesmen. Worse, the effort kept Serbia absorbed in the past, B la Yugoslavia, rather than tending to its future and the critical need to democratize the Serbian state and get rid of its criminal elements.

Moreover, rather than preparing Serbia to face its Kosovo dilemma, which many Serbs seemed ready to do after the Kosovo war, the West acted as if Serbian sovereignty in Kosovo might actually be restored. Instead of encouraging Serbs to accept the reality of the loss of Kosovo, Western envoys in Belgrade have encouraged Serbia's leaders to believe there remained a serious role for Serbia in Kosovo. Part of the West's rationale was that the new Serbian government was fragile, and it should do nothing to make life more difficult for it by discussing Kosovo's future. You can bet the same argument will be made by Western ambassadors as Serbia tries once again to fashion a new government after its latest elections.

Finally and more broadly on Kosovo, the West has faltered by consciously putting off consideration of its final status. Some Western governments are simply opposed to Kosovo's independence, but for most democratic governments the attitude is: why make painful decisions when you don't have to? Few countries are willing to bear short-term costs for uncertain long-term benefits.

Digging a bigger hole

The West failed to act when the political possibilities for movement on Kosovo were greatest. It has more recently compounded the problem by continuing to insist, after four years, that the freely elected Kosovo government cannot run the country and that a UN mission must do it. Western countries have developed a formula for further delay by insisting that Kosovo meet certain wonderful standards for good governance before it may even have an effective government with real decision-making powers, and also before its final status can be considered. The West has thus dug itself an even bigger hole on the Kosovo issue, and uncertainty about the future of all three entities - Serbia, Montenegro and Kosovo - has become greater, making investment and economic growth in the region all the more difficult. Delay and the recent Serbian elections have also made the partition of Kosovo more likely.

Nobody said that there is an easy solution to Kosovo. Independence, with or without partition, is a complicated matter with uncertain consequences. Certainly there will have to be negotiations between Serbs and Kosovars on any final solution. Major international considerations are also involved. But when delay has been the Western response in the Balkans, the results have invariably been bad. From the current Western approach we can look forward to deadlock, political instability, increased ethnic tensions, low-level violence, continued Mafia-dominated governments and little growth.

Cooperation between Europe and the United States is great, except when they pursue bad policies. Democratic governments are less prone to admit error and more to change the subject and rhapsodize on all the good things they think they are doing. It is time to get a concerted Western policy that truly helps reform Serbia, frees Serbia and Montenegro from their pseudo-union, allows the people of Kosovo to have a real government, and begins the painful process of resolving the Kosovo question.

The writer is a senior fellow at the Century Foundation and former president of the Carnegie Endowment for International Peace. This article appeared in The Washington Post, 7 January 2004