Combination Chemotherapy With or Without Peripheral Stem Cell Transplantation in Treating Patients With Myelodysplastic Syndrome or Acute Myelogenous Leukemia

DISEASE CHARACTERISTICS: Pathological confirmation of one of the following: Untreated refractory anemia with excess blasts (RAEB) in transformation RAEB with greater than 10% blasts cells in the bone marrow Other myelodysplastic syndromes Profound cytopenias Acute myelogenous leukemia (AML) supervening after overt myelodysplastic syndromes (MDS) of more than 6 months duration No blast crisis of chronic myeloid leukemia No leukemias supervening after other myeloproliferative disease No leukemias supervening after overt MDS of less than 6 months duration The following are allowed: Secondary acute leukemias following Hodgkin's disease or other malignancies Secondary leukemias following exposure to alkylating agents or radiation PATIENT CHARACTERISTICS: Age: 16-60 Performance status: WHO 0-2 Hematopoietic: If RAEB, blasts cells of greater than 10% in bone marrow Neutrophil count less than 5,000 or Platelet count less than 200,000 Chronic myelomonocytic leukemia (CMML) with greater than 5% blasts cells in bone marrow, or CMML with neutrophil count greater than 160,000 or monocyte count greater than 2,600 Hepatic: Bilirubin no greater than 1.5 times normal Renal: Creatinine no greater than 1.5 times normal Cardiovascular: No patients with severe heart failure requiring diuretics or an ejection fraction of less than 50% Neurological: No severe concomitant neurological disease PRIOR CONCURRENT THERAPY: Biologic therapy: No treatments within the past 4 weeks of: Biological response modifiers AND/OR Low dose Ara-C Chemotherapy: No prior intensive treatment for MDS or AML Endocrine therapy: Not specified Radiotherapy: No prior treatment for MDS or AML Surgery: Not specified