AN AILING AND shaky Boris Yeltsin, the Russian president, has now fired his fourth prime minister in less than a year and a half and named a relatively inexperienced and little-known bureaucrat, 46-year-old Vladimir Putin, as his fifth. Mr. Yeltsin named him, too, as his choice to succeed him as president -- elections are due in 2000 -- although the value of a Yeltsin endorsement is at best dubious and other major contenders are both more practiced in government and better equipped with a political base. In fact, the designation of Mr. Putin is an impulsive move, based apparently less on careful political calculation for the sake of governing than on desperate political maneuver for the sake of holding on to power. With a career centered on security and political-staff work, Mr. Putin seems at face unready to justify his boss's presentation of him as "a man who in my opinion is capable of uniting society, based on the broadest political forces, to ensure the continuation of reforms in Russia."

To make matters worse, the latest purge in Moscow comes at a moment of an ominous buildup of tensions in the Russian Caucasus Islamic republic of Dagestan, neighbor and kin to Chechnya; the Chechens fought their way to effective independence from Russia in the mid-'90s. A deepening rather than a dampening of hostilities in Dagestan would, whatever its military consequences, further strain the Russian political fabric. The country has a weak central government and a loose grip on the rule of law, and is ill fitted for another full-scale war in its Islamic hinterland. As if Russians did not have enough neuralgic issues on their plate already: How the Dagestan crisis plays out is likely to feed directly into the presidential elections next July.

Just two weeks ago, Mr. Putin's predecessor was in Washington acting as though he were a real prime minister and being gratefully accepted as the worthy interlocutor that is Washington's recurrent desire no matter what regime rules in Moscow. Bill Clinton, like other American presidents, is regularly accused of getting too close to whoever sits in the Kremlin. But there is business to be done -- drawing Russia further into arms control, for instance -- and anyway the right mix of engagement and detachment can serve the larger American purpose of accustoming Russia to democratic ways. Mr. Yeltsin, a vigorous spokesman for reform, needs to be encouraged to implement his rhetorical commitments to it. Here Russia's Western banks have a responsibility and a role.