July 1, 2001

U.S. flag flies at Sandinista rally

                 MANAGUA, Nicaragua (AP) -- A startling sight has appeared at the head
                 of a rally by the Sandinista National Liberation Front: an American flag --
                 not burning, but waving alongside the party's own black-and-red banner.

                 The flag carried by a Nicaraguan resident of Miami is another sign of the
                 Sandinistas' attempts to project a more moderate image, setting aside the
                 conflicts of the 1980s, when the United States sponsored Contra rebels against
                 the Sandinista government of the time.

                 The rally and march, which began Saturday and ended early Sunday,
                 commemorated a successful Sandinista retreat from the capital 22 years ago
                 during their battle against the dictatorship of Anastasio Somoza .

                 Supported by the Soviet Union and Cuba, the Sandinistas adopted a series of
                 increasingly radical measures after taking power in 1979, leading the United
                 States to attempt to topple the left-wing government.

                 At party rallies in that era, the Sandinistas sang an anthem describing Yankees as
                 "the enemies of humanity."

                 Since losing power in a 1990 election, party leader Daniel Ortega has tried to
                 ease hostility with the United States, repeatedly insisting that a new Sandinista
                 government could have normal relations with Washington.

                 Ortega, president from 1985 to 1990, is again a candidate in the November 4
                 elections here and he leads in most polls.

                 Increasingly alarmed, U.S. officials have publicly warned that a Sandinista
                 victory could have damaging consequences.

                 During the rally, Ortega promised to lead Nicaragua "to the promised land" if he
                 wins the election.

                 In an interview published Sunday by the newspaper La Prensa, Ortega insisted
                 that the Sandinistas would not repeat the widespread expropriations they carried
                 out in the 1980s.

                 "That stage is now in the past," he said. "We are talking with businessmen about
                 reactivating the economy of this country."

                 He admitted that the Sandinistas had erred in overly closing the economy when
                 they governed in the past, using enormous public subsidies to try to provide the
                 goods that a shrinking private sector could not.

                 "The most correct thing is to carry out a policy that lifts productive activity so
                 that the people can buy products," he said.

                   Copyright 2001 The Associated Press.