ST. PETERSBURG, RUSSIA - Boy did communism not work here. Boy did it not work. Mind you, CNN says capitalism isn't working now either. But first of all, let's focus on the communists, who are much easier to make fun of because of those big fur hats.

In fact, do you want to buy a big fur hat? Five guys, standing between your tour bus and the museum, are going to make you buy one. Or an officer's cap from the Soviet army - a proud symbol of world power, yours for $20. OK, $10. How about a Russian bride? Or maybe a vender will sell you his index finger or glass eye. Come on, you stupid American, buy something!

It's like a Third World country, this once imperial conqueror. Everybody is hustling, while sales people fumble as they try to figure out how to work the cash register. The Russians seem intensely proud and ambitious and they don't have the slightest idea what they're doing.

Meanwhile in the world of capitalism, British news services inform me that WorldCom is going down the toilet - or "loo." And since I use MCI, my best bet for long-distance phone calls soon may be to pack up a van and move to wherever I plan to have a conversation.

Communism and capitalism are both on the skids, as is everything that preceded them. What can be salvaged?

Well, let's at least look at communism. I don't know much about it, but I think it was supposed to work like this: Instead of allowing individuals to own property, the Soviets gave everything to the government. This allowed politicians to do, on a grand scale, what politicians do best: Avoid responsibility for anything. That's probably why almost every old building I've seen in St. Petersburg has chunks of plaster falling off the facade, and new buildings tend to resemble a Veteran's Administration hospital, without the delicious food.

And the Russians have little to back up on except their previous governmental system, czarism. That's when an autocratic ruler takes all your possessions, covers them with gold leaf and lets the dogs chew on them. That system failed, too. Nonetheless, with communism collapsed, the St. Petersburg government can think of little else to do for now except - I kid you not - haul out the Czar's old things and cover them with gold leaf again. There's an enormous effort to spruce up the old castles, then cram tourists into them until they achieve the density of nuclear materials.

Capitalism, however, encourages innovation - such as the new accounting practices developed by some of our most successful corporations. As I understand it, if you make more money than you spend, you count that as profit. If you spend more money than you make, you count that as profit as well. Your stock price goes up no matter what, until auditors open your vault and discover nothing but shredded phone books and old strobe lights.

So if we can trust neither the government nor entrepreneurs, what kind of economy can work? I suggest the system adopted by the vast majority of Russians I've met so far - an economy based entirely on nesting dolls.

These are dolls that contain slightly smaller dolls inside them. And inside those are other, even smaller dolls, and so forth, until you reach the tiniest dolls imaginable, which women always adore and men always lose or break. How do you find a nesting doll in St. Petersburg, you ask? Well, you walk out of any hotel room and swing a dead cat in a simple 90 degree arc. You'll knock over three of them. The damn things are clustered everywhere like termite eggs.

There's much to be said for this system. Aside from being adorable, the dolls are a solid thing that you can hold in your hand and cannot be lied about in a balance sheet. At the same time, extremely rich people would be forced to have them all over the house. And finally, they convert well into other currencies. Already, you can bargain for them either with rubles, dollars, pocket lint, chocolate bars or nylon stockings.

In fact, things being how they are with the Russian food supply, you might make a pretty good swap for the dead cat.