Three squabbling leaders of Bosnia visited the New York home of the U.S. ambassador to the United Nations recently and found themselves the targets of American diplomatic pressure. Urged on the spot to accept a three-page statement affirming their commitment to political cooperation and ethnic integration, they responded that it was far too complex.

Ante Jelavic, the Croat member of Bosnia's three-member presidency, said he could not stay to argue because he had tickets to see the Broadway musical "Chicago." Milorad Dodik, the prime minister of the Bosnian Serb Republic, said he wanted to reach Madison Square Garden before the tip-off of a Knicks basketball game. But Ambassador Richard C. Holbrooke told those two and Alija Izetbegovic, the Muslim member of the ruling trio, that they could not leave until they accepted what the document said, according to three people present.

Ultimately, they did, and the Clinton administration hailed the accord as a further step toward ethnic reconciliation in Bosnia. But what played well in Manhattan garnered terrible reviews at home. Under withering criticism from other politicians and the nationalist-influenced media, the leaders subsequently dismissed provisions supporting a single passport, joint military units and a stronger federal government.

"No statement was signed in New York, and we cannot discuss it as a declaration," Zivko Radisic, a top Serbian politician, told local reporters in eastern Bosnia the following week. At the United Nations on Jan. 12, Holbrooke rebuked the Bosnian leaders for failing to live up to their pledge. "I am here today to express our considerable annoyance at the delays," Holbrooke said.

The mutual abrogation of the promise fit a long-standing pattern, according to U.S. and allied officials. More than four years after Holbrooke and other top administration officials pushed, pulled and prodded Bosnia's leaders into accepting an agreement--the Dayton peace accord--meant to halt violence and stitch three ethnic enclaves into a single functioning government, few signs exist of their conciliation or joint governing.

Instead, there is relentless political fighting and continued ethnic separation. More than $4 billion in foreign aid, including $1 billion from the United States, has made barely a dent in the nationalist goals of the three wartime political parties that still control separate regions of Bosnia.

Nor do officials here suggest that the presence of 29,000 NATO troops from 37 countries--soon to be reduced to 20,500--has accomplished much besides interrupting ethnic violence that could resume when the soldiers depart.

"For the international community, time in Bosnia remains at the same place. It doesn't go any further," said Safet Orucevic, the Muslim deputy mayor of Mostar, a city in southern Bosnia that has remained rigidly divided since the end of the war into hostile Muslim and Croat enclaves on opposite sides of the Neretva River.

The peace accord, which was signed in Paris in December 1995 after protracted U.S.-sponsored negotiations in Dayton, Ohio, divided Bosnia into a Muslim-Croat federation and a Bosnian Serb Republic, each with its own president and legislature. It also established a central government with a collective, three-person presidency filled by one representative from each ethnic group.

But other concrete steps aimed at achieving ethnic reconciliation have languished in an atmosphere of continuing bitterness, recrimination and corruption.

It's not that Bosnia's largely impoverished residents are happy with the way things are. Unemployment is approaching 50 percent, politicians and ethnic tensions have prevented more than 1 million people displaced during the war from returning to their homes, and international watchdogs here say criminals have forged partnerships with virtually every municipal government.

Most political leaders are widely viewed as incompetent or corrupt, and in a poll conducted for the Organization for Security and Cooperation in Europe (OSCE) last summer, "none of the above" was the clear victor when residents were asked whom they respected.

But the Bosnian people have not shed the nationalist views that helped provoke the war. The poll indicated that a top priority for Serbs and Croats remains the maintenance of independent ethnic entities. Two-thirds of all citizens say they will vote only for members of their own ethnic group in forthcoming municipal elections.

In the poll, only Muslims, who constitute a slight majority, expressed optimism about change in the near future; a majority of Serbs and Croats said ethnic reconciliation is unlikely for decades. Even so, Muslim leaders are attempting to rename the country's language "Bosnian" instead of "Serbo-Croat"--a move that would belittle the Serb and Croat minorities, despite the lack of any linguistic difference.

In this emotional atmosphere, politicians have few incentives to orchestrate the return of those displaced by the war, a long-standing goal of the West. Huge obstacles persist, ranging from harassment and outright violence to the denial of municipal services for newly arrived minorities. An estimated 70,000 people returned last year to areas where they belonged to an ethnic minority, but this was just two-thirds the number of returnees to such areas in 1998, according to U.N. officials. The trend is headed in the wrong direction, they said, suggesting the displaced population is frozen in place.

"The ethnic cleansers are winning the battle to shape postwar Bosnia," said James Lyons, director of the International Crisis Group's office in Sarajevo.

Bosnia still has three ethnically based armies that consume roughly 40 percent of all public spending. Serbian officers are trained in Belgrade, the Yugoslav and Serbian capital, and hold commissions in both the Yugoslav and Bosnian Serb armies. Croat officers have roughly the same arrangement with the government in Croatia. Few have any loyalty to Bosnia's central government, according to NATO officials.

Western diplomats note that there are still three separate and largely toothless police forces, and multiple illegal secret police organizations--also ethnically based--controlled by rival ethnic political parties. An extensive system of party patronage governs the allocation of jobs and apartments, and the disposition of private land seized illegally during the war. The parties also have a stranglehold on Bosnia's corrupt judicial system, the diplomats say.

"It's just a great old commie system that hasn't changed," said Jacques Klein, who was the second-ranking Western official in Bosnia from 1997 to 1999 and now directs U.N. operations here.

With the economy mired in graft and stifled by communist-era bureaucracy, "the only thing that unites the three factions here is [their involvement in] crime," a senior NATO official said.

For example, Western diplomats said they have seen evidence that the former prime minister of Tuzla province, a Muslim, diverted an estimated $30 million in public funds to his friends over the past few years, squandering it on bad loans, needless painting of government buildings, overpriced pharmaceuticals and official cars. Some funds were spent on a contract to make nonexistent tombstones for Muslim victims of the 1995 massacre at Srebrenica, a town in eastern Bosnia where Bosnian Serb forces killed thousands of people. He is on trial on several charges.

One Western diplomat said the Muslim mayor in the city of Sanski Most "ran it like it was his own factory or property," diverting public funds to help build a racetrack and back family members opening a bank. He has been dismissed. Meanwhile, Croat officials in Stolac are involved in a stolen car market and smuggling ring, other diplomats said.

Three officers of the Bosnian national bank transferred $7.4 million in public funds to a Croatian bank, where it disappeared, the diplomats said. Scores of municipal officials who control Bosnia's border crossings routinely take bribes to let cigarette smugglers in; the practice has cost the government an estimated $100 million in taxes, according to federal officials and European Commission experts.

"What has been missing so far is the deterrent factor," said a recent European Commission study. "Since the war, very little, if anything, appears to have happened to individuals or organizations who have evaded duty and tax."

Moreover, Westerners responsible for overseeing Bosnia's government say they still have little clue where the revenue from huge state enterprises in each ethnic region--such as utilities, banks and telephone companies--goes. They suspect the nationalist parties that control these enterprises are diverting the funds into private hands or using them illegally to maintain political power.

"If you want to know the reason why things have moved slowly, it is because the political parties are still deeply entrenched in everything--the media and the economy--plus the alliances with organized crime," said Robert Barry, head of the local office of the 55-nation OSCE. "They are not interested in real privatization; they want to see the assets drained. It's almost too late to get on with real economic reform."

NATO's formal, written appraisal is that "no appreciable progress" has occurred on democratization or economic development in the past six months. Its pessimism is reflected in the construction of a new military headquarters in the town of Butmir, east of Sarajevo, on public land commandeered for at least the next five years with the general understanding that it will be used as long as 25 years, according to military and U.N. officials.

Many Western officials say the fault partly lies with the Dayton accord's provisions that allowed wartime leaders to gain new legitimacy in November 1997 elections strongly backed by the Clinton administration. But they also blame the accord's underlying premise that Bosnia's citizens were so exhausted by the conflict that they would work together instead of pursuing ethnic separatism.

The idea behind the accord was that "we would take a 'C' result done by the Bosnians over an 'A' result imposed" by foreigners, a senior Western diplomat here said. "The problem is, we've gotten 'F's' and 'incompletes.' . . . The jig is kind of up. There isn't a lot of mystery to it anymore."