Panic Back in Race After Serbia Court Decision

Serbian authorities backed off late Saturday from a blatant effort to prevent Yugoslav Prime Minister Milan Panic from challenging nationalist strongman Slobodan Milosevic for the presidency of volatile Serbia.

In a sudden reversal of policy announced by the state-run Tanjug news agency, the Serbian Supreme Court overturned a ruling by the republic’s Elections Commission that Panic failed to meet residency requirements for candidacy.

The Southern California businessman who left his pharmaceuticals empire in July to take over the government of his isolated and economically doomed homeland had been ruled ineligible for the presidency because he had not lived in Serbia for at least a year, as required by a law passed by Milosevic allies only a month ago.

Ironically, the Elections Commission chairman who Thursday disqualified Panic from running also presides over the republic’s Supreme Court, suggesting that authorities have deliberately corrected earlier efforts to keep Panic off the Dec. 20 ballot.

Panic had reacted angrily to the electoral body’s ruling two days earlier. He called the decision to exclude him “insane,” and his supporters defiantly aired new campaign commercials Saturday and said they would proceed as if their candidate would eventually be allowed to compete.

“As far as we are concerned, he remains a candidate and will continue to be a candidate,” said a top adviser to Panic, Zoran Basaraba.

Panic, a 62-year-old naturalized American citizen born in Belgrade, still faces an uphill battle to unseat Milosevic, whose ruthless manipulation of Serbian nationalist sentiment has fueled deadly wars in Croatia and Bosnia-Herzegovina for the past 18 months.

Tens of thousands have been killed in the areas of Croatia and Bosnia where Serbian rebels have refused to accept non-Serbian rule, and at least 100,000 are missing and presumed dead in the conflict--most of them Slavic Muslim civilians.

Public opinion polls in Serbia show more support for Panic than for Milosevic, but the latter controls influential state broadcast networks and most armed forces.

The preponderance of armed might in the hands of Milosevic has raised concerns that an opposition electoral victory would only lead to a hard-line coup d’etat.

“If Milosevic wins, Serbia will continue to ignore its problems with the international community. And if he loses, no one believes he will give up power in a fair and democratic manner,” commented one Western diplomat. “What we will see (if Milosevic loses) is a diversion of attention from the small problem of an election loss with the much larger problem of ethnic war in Kosovo or the Sandjak.”

The envoy referred to two tinderboxes within Serbia in which a predominantly Muslim population could be provoked into clashes with heavily armed Serbian police in the region, resulting in massive deaths and a crisis that could be seen to justify a military takeover of the Belgrade regime.

Panic, though ridiculed by pro-Milosevic media, has sought to defuse tensions in Kosovo and other ethnic hot spots. He has repeatedly called for an end to the wars in Bosnia and Croatia, although he has little influence with the rebel Serbian factions in either republic.

Panic’s success in building a multimillion-dollar business empire based in Costa Mesa has impressed many Serbian voters with the idea that as president the ebullient, can-do American could rescue them from the economic disaster they now confront.

Serbia suffers hyper-inflation in excess of 100,000% a year, and most families are struggling along on incomes of $100 per month or less, after having become accustomed to more prosperous lifestyles afforded on salaries that often topped $2,000 per month a few years ago.

Despite the implied promise of a return to Western comforts, Panic’s irrepressibly optimistic style has also left him vulnerable to opponents. Election campaign propaganda by Milosevic’s Serbian Socialist Party portrays Panic as a clown-like foreigner willing to sell off Serbian assets and bow down to Western conspirators.