From dissident guru to plaster saint: sleaze scandal topples Czech leader

In another time but in the same place, the story of the rise and fall of Vaclav Klaus might have inspired even the playwright Vaclav Havel. It is a parable of the corrosive influence of power, of over-reaching ambition and, finally, monumental failure.

Until yesterday, the two Vaclavs had been Eastern Europe's most successful double act. Mr Havel, spiritual leader of the "Velvet Revolution" still resides in Prague's Hradcany's palace as President. But Mr Klaus, who penned the revolutionaries' demands and delivered them to the Communist Party almost exactly eight years ago, is gone.

In 1989, hundreds of thousands of protesters rattled keys and roared in the streets as Mr Klaus was presenting his eviction notice. Late Saturday night, when his party was discussing Mr Klaus's future, his army of support had dwindled to about 500, and they did their idol no good by pouring a Coca Cola over the head of one of his rivals.

Mr Klaus was forced to emerge from the smoke-filled room where his crucifixion was taking place to quell his fans. "Thank you for your kind words. I appreciate it but it is starting to become counter-productive, with the shouting," he told them.

Shortly after midnight came the humiliating press conference, broadcast live on television. "I do not think it would be productive for this government to go on, and naturally it is out of the question for me to seek any kind of important position in the government to come," he announced.

The outgoing prime minister salvaged his position as head of the Civic Democratic Party, his own creation. But even that is in jeopardy, as a hurriedly convened party congress two weeks from now is unlikely to rubber- stamp that role.

Ostensibly, the former economics professor is quitting because he is seen to have been economical with the truth. Mr Klaus is caught up in the middle of a scandal over donations.

The affair goes back to November 1995, when a cheque for 7.5 million crowns (pounds 130,000) was deposited in his party's coffers.

The mysterious donation was originally attributed to a Hungarian who, it turned out, had been dead for 12 years, and to a man from Mauritius who had never heard of Mr Klaus's party.

Only recently was the true source revealed. The benefactor turns out to have been Milan Srejber, a Czech tennis player turned businessman and proud owner of the country's third-largest steelworks, which was bought from Mr Klaus's government at a very advantageous price. Now there's a coincidence.

Mr Klaus claims to have known nothing of the affair. But his party deputy, Josef Zieleniec, resigned in protest at the end of October as foreign minister, and claimed last week that Mr Klaus had known about the donation earlier than he let on.

There is, of course, probably not a single party in Eastern Europe untainted by sleaze. The new masters of the emerging democracies have in most places turned out to have as sticky fingers as their predecessors. Nor is Mr Klaus the only man standing accused in the Czech scandal. But the 56-year old monetarist professor who once lectured Margaret Thatcher on Thatcherism was expected to set a better example.

His worst failing, and true cause of his demise, has more to do with economics than morality. Mr Klaus's shock therapy brought spectacular success in the early years, but recently ran into trouble. A currency crisis earlier this year exposed weaknesses, persuading foreign fund managers that places like Warsaw and Budapest, where leaders had shunned Mr Klaus's monetarist dogma, were safer investment bets.