Early returns show that the liberals win...

...in Nicaragua. Chavez's dream of a Communist Bloc in the Americas has one more piece in line.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aYJLbC4M85hs&refer=home

Ortega Wins Nicaraguan Election, Early Count Shows (Update5)

By Bill Faries

Nov. 6 (Bloomberg) -- Daniel Ortega, the Sandinista guerrilla leader who ran Nicaragua in the 1980s, regained power by winning the Central American country's presidential election, an early count of the votes showed.

Ortega, making his third bid to return to office since being voted out in 1990, had 40 percent of yesterday's vote with 40 percent of ballots counted, La Prensa newspaper said, citing the electoral tribunal. Ortega can win election in the first round by taking 40 percent of the vote or getting 35 percent and beating the second-place candidate by at least 5 percentage points. Calls to the tribunal by Bloomberg weren't answered.

Ortega, whose rule in the 1980s was marked by soaring inflation and a civil war against U.S.-backed rebels, had a lead of about 7 percentage points over Eduardo Montealegre of the National Liberal Alliance party. U.S. officials including Commerce Secretary Carlos Gutierrez said prior to the vote that a victory by Ortega may put $220 million in U.S. aid at risk.

``A lot will depend on how Ortega governs and on what he says between now and his inauguration,'' said Timothy Charles Brown, a former liaison to the U.S.-backed rebels who is now a research fellow at the Hoover Institution, a policy analysis organization in Palo Alto, California.

`Fruits of Power'

Montealegre said earlier in the day that he wasn't conceding the election. ``We have to wait'' for final results, he said in an interview with CNN en Espanol. He said the election had been ``plagued by irregularities,'' such as the slow vote count and polling stations opening late yesterday.

Former vice president Jose Rizo is in third place in the voting, with 20 percent.

``The problem in Nicaragua is that no one has governed with the well-being of the people in mind,'' Brown said in a telephone interview. ``Their focus has been on sharing power, or at least the fruits of power.''

Ortega's victory will extend the influence of Venezuela's President Hugo Chavez in Central America, said U.S. Congressman Dan Burton, who chairs a committee overseeing relations with Latin America. Chavez, who called U.S. President George W. Bush ``the devil'' at the United Nations in September, publicly backed Ortega heading into the election, donating fertilizer and a tanker of oil to Sandinista-run municipalities.

Oliver North

``If Chavez weren't around, people would be less worried about Ortega,'' Russell Crandall, former director of western hemisphere initiatives at the National Security Council, said in a telephone interview from Davidson, North Carolina.

U.S. State Department spokesman Tom Casey said in a news briefing in Washington today that the government ``will wait and see'' the final results and the comments of observer groups before responding to the election. Prior to the election, Gutierrez had also said that an Ortega victory could threaten Nicaragua's participation in the Central American Free Trade Agreement.

Jennifer McCoy, Americas director for the Atlanta-based Carter Center, said by telephone today from Managua that there were no ``major'' reports of problems with the voting process. The Carter Center is leading an international delegation of election observers, including former U.S. president Jimmy Carter.

Oliver North, Ortega's antagonist in the 1980s Iran-Contra Affair, has also challenged the ex-president's campaign to return to office. North, a retired U.S. Marine Corps lieutenant colonel who ran an illegal program funding rebels seeking to topple Ortega, flew to Nicaragua last month to support his opponents.

Nicaragua is the Western Hemisphere's second-poorest country with a $5 billion economy, according to the Inter- American Development Bank.