It would have been unthinkable at the height of the Cultural Revolution. At the Communist Party Central Committee's recent propaganda conference, President Jiang Zemin raised the slogan of "rule by virtue".

The concept, with its roots in 2,200-year-old Confucian tradition, has never appeared in political documents of the ruling party,

In his January 10 speech, Mr Jiang told his audience that governing the nation by the rule of law alone was not enough. In addition, there must be the "rule of virtue".

He did not explain what he meant by virtue, but the official press is now full of propaganda cadres' columns celebrating the new slogan, quoting tirelessly from the Confucian classics.

This is viewed by some Beijing intellectuals as part of the leadership's effort to fill a vacuum in Marxist political theory caused by the collapse of most of the Leninist states.

This need is especially important as the 80th anniversary of the Chinese communist movement approaches. It could also help communism compete with the influence of Falun Gong's moral teachings.

Reaction has been mixed. For the intelligentsia, Confucianism is part of traditional culture and far more familiar than Marxism. At the same time, intellectuals also fear that, as happened in the past, Confucianism can easily be abused and used to justify bureaucratic and conservative rule.

A researcher at the National Library said Mr Jiang was the first Communist Party member to officially, and unashamedly, inject such a key element as Confucianism into communism. "This man is no longer living under the shadow of his predecessors - Mao Zedong or Deng Xiaoping or whoever. And now he wants to show us that he can also make history," the researcher said.

The concept of the rule of virtue does bring new dilemmas. For example, it also requires rule by virtuous people, which could be seen to place the emphasis on the personality of leaders rather than on the rule of law, which China is trying to establish.

"That's why today's politicians have to be very careful when they play with an ancient concept like this," said a staff member of the Chinese Academy of Social Sciences. "It's also why Jiang can only use it as an additional proposal to that for the rule of law."

But the emphasis on the rule of virtue highlights the leadership's main concern: the crisis of legitimacy which the Communist Party faces, due in part to widespread corruption.

Mr Jiang has pointed out that most government servants who grew up during Mao's endless political campaigns, including one against Confucius, have never received any kind of moral education.

An enormous effort is now under way to make Communist Party officials peruse Confucian classics in party schools.

Mr Jiang's other concern is Falun Gong - not so much with its institutional or financial power, which cannot match Beijing's, but with its appeal to people from the lower economic classes.

It is believed that Mr Jiang's policy advisers have told him that Falun Gong and the Taiping Rebellion, led by a self-styled Christian sect about 150 years ago, share the same weakness.

Just as Mao once noted that the Taiping Rebellion failed because it was unable to enlist support from the Confucian gentry and scholars, Falun Gong has never won endorsement from any of the nation's top scholars.

The Beijing leadership's strategy may be an attempt to undermine Falun Gong's moral appeal by promoting Confucian virtue as an alternative.

"It would be a clever move," commented a Western-trained political scientist. Just as Deng Xiaoping advocated socialism with Chinese characteristics, Mr Jiang may be trying to crea

Critics have been too hasty in declaring Chen Shui-bian's tenure a failure

Chinese premier Zhu Rongji once called Chen Shui-bian's presidency a "joke." Outside China, conventional wisdom increasingly seems to agree. Since Chen's election in March, Taiwan's stock market has plunged by more than 30%, a slide that pundits say represents a vote of "no confidence" in the President's abilities. Chen's approval rating, meanwhile, has fallen to less than 40%, from a high of 77%. His Premier, Tang Fei, resigned after less than half a year in office.

Chen is taking heat for everything. The economy is in the doldrums. A banking crisis is looming as problem loans pile up. The delicate relationship with Beijing has stalled, and no one can control the Vice President, Annette Lu, who pokes China in the eye at every opportunity. (In an official report, Beijing recently called the Taiwan situation "grim.") All of this adds up to a sense that Chen has squandered the promise of his election, an opinion shared, apparently, by his close adviser, Lee Yuan-tseh. A Nobel laureate, Lee said recently that the President "talked too much without giving the people a clear direction where he was going."

So is Chen toast? Is his presidency a disaster? Not at all. The slump in Taiwan stocks has more to do with global worries over the declining earnings of semiconductor companies than with Chen. Taiwan's stock-market index is packed with technology stocks; so is NASDAQ in the U.S., which has also dramatically declined since March. The market is simply saying that if Silicon Valley isn't doing well, neither should Taiwan's tech stocks.

On the political front, it's true that Chen's minority Democratic Progressive Party (DPP) has been slow to get up to speed. One reason for that is the Kuomintang (KMT), the DPP's rival, which dominates the legislature and has tended to put partisan interests above those of the nation. But the DPP's emergence as Taiwan's ruling party has already helped heal the most divisive social and political wound on the island: the rift between Fujian-dialect-speaking locals and the Mandarin-speaking mainlanders who have dominated local politics for a half-century. The topic of schism is no longer in prominent in public discourse.

As for the economy, Taiwan does indeed face serious problems. But Chen hasn't been idle. In a departure from past KMT policies, Chen is promoting bank mergers to help shore up the weakest institutions. And he says he will lift many restrictions on foreign banks wishing to compete in Taiwan. Although capital is still over-regulated, the question is no longer whether financial reforms will come, but when and to what degree.

Chen is waffling on some economic issues. But his hesitance is often understandable. Taiwan, like many other places, is grappling with a dual economy: one part is old, inward-looking and inefficient; the other is new, know-ledge-intensive and globally competitive. By letting the New Taiwan dollar find its own, lower level and by lifting regulations governing capital flows to China, Chen could encourage Old Economy companies to revive themselves by relocating to the mainland. But China isn't making it easy. Beijing recently said it would take stock of the political views of potential investors from Taiwan, particularly their level of support for Chen's DPP. The threat was later quietly dropped, but a sense of uncertainty had been sown. The reality is that both sides need each other. It is China, not Taiwan, that could face devastating unemployment after joining the World Trade Organization.

Is Chen handling the cross-Strait relationship well? Beijing clearly does not think so. But by now, even the mainland's most stubborn hawks must know that war against Taiwan is a non-starter: it's impossible to define victory in any way that makes sense.

Chen said recently he was proud to be a Chinese, a signal to Beijing that he is willing to be conciliatory. The communists, however, apparently want him to genuflect more unambiguously. China should know that putting a timetable on reunification is unwise as long as Taiwan's people are not ready for it. Chen knows his constituency better than Beijing and is calculating that he needs to proceed slowly. Chen can do better at his job, yes, but during his first six months in office he has not done badly. In the U.S., Bill Clinton didn't exactly light up the scoreboard in his first two years, but his performance improved considerably. Give Chen a chance. The conventional view about him is simply unfair.

Sin-ming Shaw is a visiting scholar at the Fairbank Center for East Asian Research at Harvard University