BELGRADE -- Three years after the end of the Balkan wars, politics in Serbia center not on nationalist obsessions of the past but on which of the two main democratic leaders now in power can better guide the country through difficult domestic reforms.

The questions of borders and ethnic dominance have virtually disappeared from public discourse, replaced by debate on the next 10 years of economic development. More and more, Serbia typically resembles its East European neighbors, which have been wrestling with an awkward transition from communism to capitalism.

"The questions of war, refugees, guilt, isolation from the West are fading. We follow the path laid out for us like sheep. Reform, transition to capitalism, democracy. It's progress, even if it is only from being a minus to being a zero," said Alexa Djilas, a well-known and keen commentator on Serbian affairs.

The new political environment is embodied by the rivalry between Vojislav Kostunica, the president of Yugoslavia -- which now encompasses only Serbia and Montenegro -- and Zoran Djindjic, Serbia's prime minister. Together, they were heroes in the ouster of Slobodan Milosevic in elections and subsequent street demonstrations almost two years ago.

Their coalition of parties, known as the Democratic Opposition of Serbia, put aside Milosevic's focus on salvaging Greater Serbia from the shards of shattered Yugoslavia. But they quickly began to differ on the pace and terms of joining the West and the European Union.

Best known outside the country is their dispute over cooperation with the U.N. International Criminal Tribunal for the former Yugoslavia in The Hague. Djindjic acquiesced to the tribunal in the extradition of Milosevic and other war crimes suspects, as the West demanded. Kostunica demurred. Although the issue of cooperation with the tribunal still divides the pair, it is their views on economic reform that currently frame their fierce competition here in Belgrade.

Djindjic, a hard-charging veteran politician with a can-do reputation, accuses Kostunica of preaching a go-slow approach to reform, thereby holding Serbia back. Kostunica, a cautious, slow-talking lawyer, regards Djindjic as a ruthless ideologue willing to sacrifice the well-being of the poor on the altar of radical capitalist "shock treatment."

Serbs may get an opportunity to give their verdict this fall. Voters will go to the polls in September or October to elect a new president of Serbia. Serbia, with a population of 10 million, is most of what remains of Yugoslavia. Its partner in the rump federation, Montenegro, has just over 600,000 people.

Kostunica is mulling a run for the office, under the banner of his Democratic Party of Serbia. Members of Djindjic's Democratic Party say the faction will probably run Miroljub Labus, the Yugoslav deputy prime minister who is overseeing economic reform. A victory by Kostunica would create pressure for early parliamentary elections and put Djindjic's hold on power at risk.

The political infighting is taking place against a backdrop of economic hardship. Official estimates put unemployment at 35 percent. One-third of Serbs subsist on the equivalent of a dollar a day; another third live on twice that.

At the same time, the country is experiencing a typical post-Berlin Wall hangover of unfulfilled expectations. The spectacle of reformers attacking reformers has turned off the electorate.

"They are no better than the crowd they threw out," said Milan Marjanovic, a janitor and customer at the Do Ya-Ya sandwich shop in downtown Belgrade. "They help their friends and destroy their enemies. Just like before."

"They waste time in politics," said Goran Ristic, a mechanic munching on a seemingly indigestible kielbasa-and-cheese submarine sandwich.

According to the Center for Policy Studies, a prominent Belgrade research institute, Serbs regard almost 40 percent of their government institutions as corrupt. Three of four citizens rate the performance of the legislature as "bad." Only the army receives generally high marks, which the pollsters attribute to the military's remove from politics.

"The general assessment is that citizens mistrust institutions so strongly, one may actually wonder how society functions at all," said Srecko Mihailovic, a researcher at the center. Milan Nikolic, another analyst at the center, said, "I would say that the ruling coalition has wasted the citizens' trust, and people's lives are worse nowadays."

Milan Mihailovic, an analyst at the Center for Social and Democratic Studies, predicted that 60 percent of voters will not cast ballots in the next elections. He said Serbs generally believe that politicians "fool around with trifles while ignoring major issues." About half of Serbs surveyed believe their lives will improve in the coming years, Mihailovic said, but the figure represents a big drop from October 2000, when three of four respondents thought conditions would get better.

A recent upheaval in parliament typified the poisoned atmosphere. Djindjic ordered the ouster of legislators from Kostunica's party on grounds that they chronically played hooky. Kostunica called the expulsions a "soft coup," pulled out his entire parliamentary faction and created a "shadow government" to snipe at Djindjic.

The two sides seize the opportunity to disagree even on topics about which they have no differences. Last week, Kostunica fired the army chief of staff, Nebojsa Pavkovic, an ouster long demanded by Djindjic. Pavkovic was a Milosevic holdover who commanded Serbia's troops in the Kosovo war. Instead of applauding, Djindjic criticized the way Kostunica got rid of the general because the Supreme Defense Council, which includes the presidents of Serbia and Montenegro, did not go along with the decision.

Kostunica said he acted within his legal rights as president.

In an interview last week, Kostunica referred to the post-Milosevic partnership with Djindjic as a "bizarre ruling coalition." He said Djindjic is pushing privatization and economic liberalization in a way that shows he and his followers "do not care how people live."

"I favor a middle way," he added.

He called Djindjic a slave to International Monetary Fund demands for budget cuts and quick privatization of state companies which, however inefficient, provide employment in a depressed economy. He also suggested that Djindjic is handing out contracts and property to cronies.

"It is reminding people of Milosevic," Kostunica said.

Labus, the deputy prime minister, contends that Kostunica is playing to the gallery while the Djindjic government makes tough decisions. "He is a person who likes to show his links with the suffering, while others pay the price of getting the job done," Labus said.

A Kostunica victory followed by parliamentary elections would "have a negative effect," he said, because it would cast doubt on Serbia's will to reform.

Labus acknowledged that efforts to streamline the bureaucracy and close or sell state-run industries has created unemployment. Laid-off workers receive a year and a half of benefits and then they are on their own. Soon, the government will raise retail electricity prices, further straining family budgets.

"These measures have hurt a lot of poor people," Labus said. He added that industrial production should soon grow, but that time is the key variable. "We can either go forward, or back and forth like some of our neighbors," he said. "That is the choice."

© 2002 The Washington Post Company