By Jim Hoagland

Sunday, July 18, 1999; Page B07

Like so many others before him, Chinese President Jiang Zemin has learned the high costs of getting close to Bill Clinton.

President Clinton came to Beijing a year ago to kiss Jiang's ring and proclaim a new era in Sino-America relations. It has been all downhill since then:

U.S. campaign finance and espionage scandals exploded in the media. Clinton personally undermined a deal to secure World Trade Organization membership for China. Five U.S. Air Force bombs wrecked China's Embassy in Belgrade. And a nasty spat erupted over U.S. opposition to a misguided World Bank loan that will entrench Chinese oppression in Tibet.

The icing on the cake of discontent came last week when Taiwan's President Lee Teng-hui decided to challenge the "one China" diplomatic formula that has guided U.S.-Chinese relations for a quarter century.

Lee uttered an obvious but inconvenient truth: There are two Chinese states that should treat each other with dignity and respect. Affluent and democratic Taiwan would now insist on having "state to state" relations with the mainland rather than be treated as a "renegade province."

Clinton's minions reacted in bewilderment at a president blurting out the truth. They called Lee's remarks "unhelpful" and took him to the diplomatic woodshed: The United States demanded "clarifications" of Lee's uncomplicated declarative sentence.

Lee deserves praise, not verbal spanking. It is Beijing's policies and politics that need clarification. Lee's remarks are a perfectly timed, probing beam of light that may help illuminate the intentions of a suddenly unsettled Beijing leadership.

It is gradually becoming apparent that the Kosovo war opened many eyes in Beijing to China's isolated and vulnerable condition in world politics. Beijing's obstructionism and fulminations in the Security Council did not prevent NATO's prevailing in a war waged on a sovereign U.N. member state.

World sympathy and outrage over the accidental bombing of the embassy in Belgrade in April was notably short-lived and restrained. China was left alone to trumpet its mistaken belief that the embassy attack had been deliberate.

The most startling bit of unconventional wisdom for the year may be this: Five U.S. Air Force precision-guided bombs may ultimately do more to introduce realism and perspective into the China-U.S. relationship than five years of sycophantic, self-deceiving diplomacy ever did.

Beijing continues to believe that somewhere in the U.S. bureaucracy someone decided to hit its embassy in Belgrade. It is easy to understand why: The bombs, intended for a Yugoslav arms procurement agency, wiped out China's civilian intelligence gathering operation for all of Europe, destroyed the defense attache's separate intelligence office and killed two spies.

The world quickly told President Jiang to get over his outrage rather than seek political capital from it. Japanese Prime Minister Keizo Obuchi reportedly found the Chinese leader in a surprisingly nonconfrontational mood during a two-day visit in Beijing last week. Although Jiang still insisted the bombing had been no accident, he did not dwell on it and seemed eager to play down Japanese-Chinese frictions, instead of exacerbating them as he did on a visit to Tokyo last year.

Experienced Asian diplomats report that the recent run of adversity may have shaken Jiang's once seemingly firm and exclusive grip on power. The military, party, government and economic factions he had successfully placated or played off against each other have begun jockeying for influence again. Jiang no longer offers immediate and total support to Prime Minister Zhu Rongji, who is beleaguered by the WTO failure and rising economic problems at home.

That is the beauty of Lee's challenge on Taiwan's status at this particular moment. It forces hard choices on Jiang. He can return to the brutal missile firing tactics China chose in 1996 in an unsuccessful effort to intimidate the island -- or he can take up Lee's offer to discuss rationally the future of the two existing Chinese states, and show that "moderates" do still wield influence in his regime.

Panicky reactions -- the initial statements out of Washington on Lee's "state to state" declaration come to mind -- could encourage Beijing to resume bullying rather than to try reason. That is a risk Lee is knowingly taking.

The harsh experiences of the past year have deflated the overblown promises, the willful deceptions and unfulfillable expectations Jiang and Clinton jointly manufactured for their own purposes in Beijing. The two leaders should seize the new opportunity to deal with each other, and with Taiwan, more realistically in Clinton's final year in power.