Nicaragua Battles of Bullets and Dollars

By John Greenwald

The details certainly sounded impressive. According to contra leaders, more than 4,000 U.S.-backed rebels crept for days through dense jungle to launch a fierce surprise attack on three mining towns in northeastern Nicaragua. In the hamlet of Siuna, the invaders routed 750 defenders, blew up an airfield and seized enough Soviet-made weapons to supply 1,000 troops. Their biggest coup was the destruction of a Soviet GCI radar unit that formed the heart of Sandinista air defenses for the region. Jubilant rebel leaders called the two- day assault the most successful offensive of the six-year civil war. "We hit them hard," claimed Enrique Bermudez, the contras' military commander. "We achieved all our objectives."

While Managua challenged the rebels' claims and quickly regained control of the towns, the attack indicated once again that the contras were far from finished as a fighting force. Unconfirmed reports monitored in Washington said the guerrillas destroyed a fuel storage facility and two electrical stations in the town of Bonanza. In nearby Rosita they overran a brigade headquarters and an airfield and cut two bridges before Sandinista reinforcements arrived aboard three Soviet Mi-17 helicopters to stop them from taking the town. Overall, the contras claimed to have seized more than 50 tons of food and weapons and killed more than 100 Sandinista troops. Managua contended that a similar number of insurgents died in the fighting. The battles also reportedly % took 19 civilian lives.

The attack came as the two warring sides began a second round of peace talks in the Dominican Republic capital of Santo Domingo. The negotiations broke down within hours; the contras insisted on talking directly with the Sandinistas, and Managua said it would bargain only through advisers. "We are at an impasse," said Miguel Cardinal Obando y Bravo, the Roman Catholic Archbishop of Nicaragua, who serves as a mediator between the belligerent parties. The two sides agreed to a two-day Christmas truce, but Sandinistas accused the contras of numerous violations. The rebels denied the charges. In Managua, Nicaraguan President Daniel Ortega Saavedra angrily blamed the U.S. for sabotaging the talks by aiding the contra offensive.

The Reagan Administration was delighted with the attack. "It is in fact the largest single operation that the resistance has carried out," noted a State Department military analyst. He declared the drive a strategic success because it targeted Sandinista staging areas and income-producing gold mines. State Department Spokeswoman Phyllis Oakley credited "military pressure" with bringing the Sandinistas to the bargaining table.

Meanwhile, Congress grudgingly bowed to the White House last week and approved $8.1 million in humanitarian aid for the rebels. (The package: $4.6 million for food, clothing and medical supplies, along with $3.5 million to deliver the goods.) The stopgap allocation will help sustain the contras until Reagan can ask for fresh military assistance at the end of January. That will be shortly after Central American leaders are scheduled to meet in Costa Rica to determine whether the Sandinistas and the contras have tried in good faith to achieve a cease-fire. If the Sandinistas seem to be stalling, Congress could once again feel compelled to provide the rebels with yet another dollop of American military aid.

With reporting by Scott MacLeod/Washington and Wilson Ring/Tegucigalpa