The Queen's advice to the Prince and Princess of Wales, to divorce as soon as possible, at last decisively cuts through the dangerous muddle that came to a head with the performance on Panorama.

Diana could not continue to confuse the roles of princess and film star, to have it both ways - to talk about her husband and her unwillingness to divorce while using television to explain her grievances against the prince as if she were on an American television chat show; to want to be an ambassador for Britain while undermining the British constitutional system; to devise a theatrical role as the "Queen of Hearts" while actually being married to the heir to the throne.

Diana's television show, however enjoyable and brilliantly rehearsed, marked a terminal confusion between entertainment and serious constitutional argument which the BBC should never have so solemnly endorsed; for it encouraged a Hollywood approach to the monarchy which was more damaging than the most scurrilous tabloid newspaper scandals. However much the British may make fun of the monarchy and relish the soap opera, it remains at the heart of the British system, not just in constitutional but psychological terms, as the basis of the national sense of continuity and security.

The British have been encouraged by the tabloid newspapers - and by Diana - to enjoy the monarchy in adolescent terms, as something to be constantly attacked and mocked, without having to think about a likely alternative: rather like teenage children hurling insults at their parents without ever contemplating leaving home.

The tabloid newspapers, abetted by the princess's party, have made the monarchy increasingly unworkable by perpetual intrusion and melodrama. Yet the British people have still not cared or dared to look at the problems of establishing a republic. Despite all the anti-monarchic frenzy, there is no serious republican party or even movement.

The result is an uncertainty which goes much deeper than appears. For behind this soap opera the Queen remains head of state and Prince Charles is her likely successor, on whom the continuity of the state depends; heads of state, much more than we realise, play not just a key constitutional role, but also an anthropological role as the guardians of national identity and reassurance. The fact that national administrations have become far more complex and impersonal in recent centuries has not diminished the psychological need for figureheads. The national insecurity which results from overthrowing them is still very dangerous. In psychological terms the subverters of this continuity, from Rupert Murdoch to the Economist, are the modern equivalents of regicides - with no Oliver Cromwell in mind as a replacement.

Republics are more aware of the importance of this continuity than monarchies, because they have had to think harder about it. Many of their people have experienced how completely they can become unnerved without their head of state. I have watched it happening in France and in the United States. In 1958 I was in Paris when the Fourth Republic was tottering to its end, when the last prime minister had been brought down by the Algerian crisis. As Parisians wondered whether the paratroops would descend from the sky to carry out a coup d'etat, their insecurity was almost palpable; they felt the whole identity of France hung in the balance - until Charles de Gaulle reappeared to provide the leadership for the Fifth Republic.

In 1974 I was in Washington when Congress was nervously preparing to impeach President Richard Nixon, who was manipulating all the splendour of his office to defend his crookery. Americans were terrified that their constitution would not work until the tapes miraculously forced Nixon to resign; and the appearance of President Gerald Ford at the White House brought back the sense of continuity.

The British could watch the constitutional crises of the Americans and the continentals with some complacency and schadenfreude, taking for granted that their own succession was assured, as rival prime ministers moved quietly in and out of No 10 while the Queen provided the continuous ceremonial figurehead.

We have too easily taken the continuity for granted, assuming that the monarchy can survive any amount of commercial exploitation as a means of entertainment without any protection, stripping all its dignity away, scandal by scandal. The princess's Panorama was the last stage in the striptease - and clearly it was the last straw for the Queen.

Now, when the divorce goes through, it should be possible to separate the crucial constitutional issues from the showbiz and to have a serious argument about what system the British really want. If we want a republic, let us discuss how we would elect a president and whether we want a former politician (such as Baroness Thatcher) to represent us.

If, as I suspect, we would take fright at that alternative, let us grow up and realise that we do not want to leave home. Let us stop undermining what we have, face up to the shortcomings of any family on the throne, insist on a more realistic and relevant court, and then provide sufficient privacy to the monarch to make the job description workable for future candidates.

The princess, by so obviously overstepping the boundary between monarchy and entertainment, may prove to have done a service by forcing us to be realistic - not just about a monarchy but about the surrounding elements of the constitution, including the House of Lords and the Church of England, which have also become confused while urgently needing reconstruction.

For the past few years the British have resisted any fundamental constitutional changes, from a Bill of Rights to proportional representation, because they have seen them as disturbing the continuity which has revolved round the monarchy. If we can grapple with modernising the monarchy, we may see more clearly how to reform the other elements.

Perhaps in the end we will be grateful to the princess for bringing the royal soap opera to a farcical climax. With all her crude publicity, she may in the end do more to force the British to think about constitutional reform than all the conscientious seminars of Charter 88.

The writer is author of 'The Essential Anatomy of Britain' (Hodder & Stoughton, pounds 4.99).