Nov. 3 (Bloomberg) -- Oliver North and Daniel Ortega, antagonists in the 1980s Iran-Contra Affair, are battling again, this time over Ortega's bid to regain the presidency in Nicaragua's elections on Nov. 5.

Ortega, a leader of the Sandinista revolution who ruled Nicaragua from 1979 to 1990, held a 15-point lead over his nearest rival in an Oct. 20 poll by Zogby International. North, a retired U.S. Marine Corps lieutenant colonel who ran an illegal program funding rebels seeking to topple Ortega, flew to Nicaragua last week to support his opponents.

The prospect of a second Ortega presidency is alarming U.S. officials. Commerce Secretary Carlos Gutierrez, former Assistant Secretary of State Roger Noriega and Representative Peter Hoekstra, chairman of the House Intelligence Committee, all have spoken out against Ortega's candidacy.

``The degree of visceral reaction and anger with Ortega is still very, very high among some in Washington,'' said Peter Hakim, president of the Washington-based Inter-American Dialogue, a policy research group.

A return to power by Ortega, an ally of Cuba's Fidel Castro, threatens to extend the influence of Hugo Chavez, Venezuela's anti-American president, said Representative Dan Burton, chairman of a committee overseeing U.S. relations with Latin America.

``Ortega has no scruples -- he's a communist,'' Burton, an Indiana Republican, said in an interview. ``He could be a destabilizing force for all the new democracies we see in Central America.''

Before Chavez

Ortega, now 61, was an outspoken critic of the U.S. two decades before Chavez went before the United Nations General Assembly in September and called President George W. Bush ``the devil.'' Ortega took the UN podium to tell then-president Ronald Reagan: ``Remember, President Reagan, Rambo only exists in the movies.'''

The Reagan Administration viewed Nicaragua -- today the Western Hemisphere's second-poorest country with a $5 billion economy, according to the Inter-American Development Bank -- as a potential beachhead in the Americas for Soviet expansion.

In 1986, North was fired from the National Security Council for running a clandestine program that sold weapons to Iran to illegally finance anti-Sandinista rebels known as the ``Contras.'' Congress publicly investigated what became known as the Iran-Contra Affair.

North was indicted and tried in 1989 on 12 felony counts for his alleged involvement. The U.S. District Court in Washington found him guilty on three counts and innocent on nine. An appellate court threw out the convictions in 1990.

`Anti-American Leftists'

North, who hosts ``War Stories'' for Fox News television, wrote an editorial in the Washington Times newspaper Oct. 9 calling for the U.S. to back a single anti-Ortega candidate. Ortega's two closest rivals are Eduardo Montealegre, a former finance minister, and Jose Rizo, an ex-vice president.

``Like Adolf Hitler, the anti-American leftists in Latin America are using elections -- not revolutions or military coups -- to take and then solidify power,'' North wrote.

North was greeted on his arrival at the airport in Nicaragua last week by former Contra leader and congressional candidate Adolfo Calero, Managua's La Prensa newspaper reported. North, who told the paper he was in the country to ``visit friends,'' later appeared on a local television station warning against a return to Sandinista rule. Messages left for North with the Fox News press department were not returned.

``Oliver North is a private citizen free to travel where he chooses,'' said Nancy Beck, a State Department spokeswoman. ``As a private citizen, his opinions are his own. He does not speak for the U.S. government.''

At Risk

Commerce Secretary Gutierrez said $220 million in U.S. aid and Nicaragua's participation in the Central American Free Trade Agreement would be at risk if Ortega wins. Through August this year, trade between the two countries totaled $1.5 billion, compared with $1.2 billion during the same period in 2005, according to the Commerce Department.

``If history is a predictor of the future, the Sandinistas will not be good for the economy or relations with the U.S.,'' Guitierrez said in an interview.

Ortega's rule was marked by ``hyper-inflation and an external debt more than six times GDP,'' the Inter-American Development Bank said in a report last year.

Ortega's opponents are also resurrecting the 1980s image of the Sandinista leader.

``The cost to Nicaragua of the civil war was extremely high -- 50,000 people died because Ortega made alliances based on a geopolitical game,'' Adolfo Arguello, campaign manager for Eduardo Montealegre, said by phone from Managua.

Running Again

Ortega, who ran unsuccessfully for president in 1996 and 2001, has sought to broaden his support by stressing his Catholic upbringing and promising that half his cabinet positions will go to women. He has campaigned against ``neoliberal'' economic policies, and says he welcomes foreign investment and will maintain relations with the International Monetary Fund.

The Sandinista party presents itself today as a force for reconciliation. The party's Web site even features a Spanish- language version of John Lennon's ``Give Peace a Chance'' under a list of campaign songs. Attempts to contact Ortega or a campaign spokesman through the party headquarters haven't been successful.

Ortega was favored by 35 percent of those questioned in the Zogby International poll, compared with 20 percent who supported Montealegre and 15 percent who backed Rizo. The poll, consisting of 800 face-to-face interviews in randomly selected households across Nicaragua, has a margin of error of 3.5 percentage points, Zogby said.

The leading candidate can win the presidency in the first round in two ways: by getting at least 40 percent of the vote or by taking 35 percent of the vote and defeating the second-place candidate by at least 5 percentage points. Otherwise, the top two finishers face each other in a second round of voting.

To contact the reporter on this story: Bill Faries in New York at wfaries@bloomberg.net

Last Updated: November 3, 2006 16:09 EST