THERE is a popular song in Latvia that goes, "Autumn comes and decorates Latvia, but don't bother, don't bother at all. For me she is the most beautiful, anyway."When an independent nation is a month old, a week is a long time. In the first week of October, Latvia's Supreme Council, or parliament, appeared to be heading for chaos. The majority caucus of the ruling Latvian Popular Front, in a move defiantly contrary to the will of the Popular Front's governing board, voted to put before the legislature a set of bills on the controversial issue of Latvian citizenship. The way citizenship is reinstated or granted may determine whether Latvia will retroactively legitimize Moscow's policies of deliberate Russification - a policy caused by overindustrializing Latvia and sending in Russians to work the factories. Presently, only 52 percent of Latvia's population of 2.6 million are ethnic Latvians, the lowest ethnic proportion in all three Baltic States. The Latvian legislature took a tough line toward adopting a citizenship policy. It passed an act requiring 16 years of residence, a knowledge of Latvian, and a background "clean" of crime or involvement with Soviets. The law would have to be approved by a referendum of pre-1940 Latvian citizens and their descendants. Even so, a strident, uncompromising faction - the "Committee of Latvia declared that it supports the nonviolent repatriation of all "migrants," whatever the cost. Otherwise, "the Russians will demand two official languages," says Aigars Jirgens, a member of the Committee. "In that kind of a climate, you will see Latvians emigrating and it will be the start of political demoralization and debasement for the republic," he adds. At the other end of the political spectrum, Sergejs Dimanis, an ethnic Latvian who leads the formerly anti-independence Lidztiesiba (Equal Rights) minority caucus in the parliament fears there will be social unrest unless all residents of Latvia are granted citizenship rapidly. "I find it hard to believe that a restrictive citizenship policy won't also be linked to the right to do business and to own property," Mr. Dimanis said. "Then it will be very difficult. I find it hard to imagine anything worse than a state with a large number of non-citizens who own nothing." The umbrella Latvian Popular Front, fearful of a backlash among supporters, declared that no laws on citizenship could be adopted before Latvia's parliament, the Saeima, was elected. The Supreme Council was elected in multi-candidate elections under Soviet law in March 1990, with entire Soviet Army units allowed to vote. Meeting in emergency session following the action by its own majority caucus, the Front's governing board began circulating petitions calling for a referendum of Latvian citizens to approve any citizenship law passed by the Supreme Council - a measure the legislature later approved. By "citizens," the Front means those who were Latvian citizens before the Soviet occupation in 1940 and their descendants. The petition was drafted by Juris Dobelis, a Supreme Council deputy and leader of the rebel majority caucus. He told me he saw no contradictions in his actions, "no problems.... " Meanwhile, six deputies quit the majority caucus, angered by the readiness of what they call "a provisional legislature" to decide fundamental legal and constitutional issues. More could bolt. That's something given the perks of being a parliamentarian in a country where the average monthly salary is $10 and falling fast. Thus, I'm pleased to hear more Latvians talking of the Supreme Council as a balagans, or honky-tonk carnival. But I worry they may now disparage democracy in favor of a "strong leader." Latvia's last authoritarian government handed the country to Stalin without a shot fired. There are more than enough refitted and retooled ex-communist bosses who would love to be a Latvian Vadonis, or leader, as the mildly authoritarian prewar president, Karlis Ulmanis, was called. BUT more than leadership, it looks like many Latvian ministers and officials want to sit on corporate boards and run newly privatized businesses. The Popular Front, for all its seeming political indiscipline, is collecting evidence that major Latvian state enterprises are being given away to "private leasors" for very little. Such was the fate of a major, highly profitable meat packing enterprise in Tukums. It also happened to Dzintars, a Latvian fragrance and cosmetics enterprise that made 40 million rubles a year but sold for 36 million. As one investigator put it, "there simply is no law" governing practices that look like the most blatant form of conflict of interest. Ministers are approving official documents that name them or their deputies to the boards of privatized state enterprises that were once run by their minist ry. Is this done for continuity? That is an excellent excuse. But it is clear that these private, executive jobs could outlast the tenure of the present government under Prime Minister Ivars Godmanis. One reason these irregularities don't get headlines is the government's ham-fisted approach to press freedom. It imposed a blackout on Russian President Boris Yeltsin's visit in late August despite eyewitness reports of his arrival. "Good" Latvian journalists weigh government suggestions about "the national interest" against the facts of their stories. To make sure of this, the government is making its own daily newspaper, Diena, "private and independent" by arranging an editorial management buy-out of a new corporation aided by generous ruble loans to those editors subscribing to the controlling share block. Finally, it seems that at some point, many of the better Latvian firms - such as the Spartaks ceramics enterprise that may be the latest victim of "management takeover" Latvian-style - will be wholly or partly bought by foreign investors. By playing the right games with stock options for board members the right people can put a green lining on Latvia's golden autumn of freedom, 1991.