Nicaragua Presses for End to Crisis : Hostages: Government wins release of 14, but two dueling factions still hold more than 70 captive. Series of explosive events weakens Chamorro’s ability to govern.

Struggling to defuse a crisis that threatens the stability of this violent and polarized country, the Nicaraguan government pressed negotiations Saturday with two groups of gunmen--one Sandinista, the other Contra--who seized the vice president and more than 70 other hostages.

The hostage-takers--a leftist group here in the capital and right-wing rebels in the northern mountains--at first hardened their positions and refused to release their captives. But by Saturday evening, the Managua group released 14 hostages.

The crisis was the latest in a series of explosive incidents that have chipped away at President Violeta Barrios de Chamorro’s ability to govern and pushed Nicaragua, where the hatreds of more than a decade of guerrilla war are easily reignited, deeper into chaos.

Dozens of people were killed last month when former Sandinista soldiers, angry at the government, attacked Nicaragua’s fourth-largest city. And the hostage-taking has unleashed a violent chain of retaliation, including an armed attack on a conservative radio station. From both the left and the right, as well as from Washington, pressure has been mounting on Chamorro to make radical changes in her policies.

“This is what we have been fearing and predicting for some time, that the country was degenerating into a kind of warlord violence,” a diplomat said Saturday.

Roman Catholic Cardinal Miguel Obando y Bravo, the archbishop of Managua and a frequent mediator in national crises, called on the hostage-takers to release their captives and “prevent a blood bath.”

Saturday evening, some progress was reported in talks to free the hostages.

The pro-Sandinista group in Managua, which was holding Vice President Virgilio Godoy and 33 other politicians and legislators from the conservative National Opposition Union (UNO), released 14 of the hostages after persuasion from former Sandinista President Daniel Ortega. Godoy was not among those released.

The lead hostage-taker, who identified himself as Comandante 40, challenged authorities to find a solution to the crisis. “If the government and the (political) representatives cannot reach an agreement, it is a sign of their joint irresponsibility,” he said. Dressed in jungle camouflage clothing and covering his face with a white bandanna, he spoke to reporters through the window of UNO headquarters, where police were kept at bay most of the day with at least one warning shot fired by the kidnapers.

The gunmen are demanding the release of a delegation of lawmakers captured Thursday by rearmed former Contra rebels who operate in the northern hills.

A band of about 400 so-called Re-Contras, led by Jose Angel Talavera, seized the 41-member delegation, including several Sandinista legislators and military officers who had traveled north with an offer of amnesty.

Talavera, who uses the nom de guerre The Jackal, is demanding the removal of Defense Minister Humberto Ortega and Antonio Lacayo, Chamorro’s powerful chief of staff.

A decade-long war between the Sandinista army and U.S.-backed Contra rebels ended in 1990 with Chamorro’s electoral victory over the Sandinista Front. But several thousand former combatants from both sides have rearmed in the last two years to demand that the government fulfill promises of land and assistance.

Many of the Re-Contras echo the political right in complaining that the Sandinista Front, especially through Humberto Ortega, continues to wield enormous power. They accuse Lacayo of orchestrating what they call a co-government. Chamorro and Lacayo defend themselves, saying that it is necessary to include Sandinistas as part of a program of reconciliation.

The rearmed groups have stepped up their simmering war on Chamorro’s government, attacking police stations, rural traffic and farming cooperatives.

Chamorro, who has already been abandoned by the coalition she headed in the 1990 elections, has found herself in an increasingly precarious and isolated position. Godoy is now her most vocal foe.

Daniel Ortega, who is Humberto Ortega’s brother, warned last month that if Chamorro does not address economic problems, she may not finish her term.

Then the U.S. Senate voted to cut off $98 million in desperately needed aid after the explosion of a secret arms dump raised questions about whether the Sandinistas, who control Nicaragua’s army and police, maintain ties with international terrorists.

Early this month, the Clinton Administration, in private meetings with Chamorro and Lacayo, warned that the aid will not be renewed unless Humberto Ortega is replaced and progress is made on key human rights cases.

On Saturday, the U.S. State Department urged the hostage-takers to cooperate with Chamorro’s government, the Associated Press said.

“The government of the United States deplores the recent outbreak of violence in Nicaragua resulting in two separate incidents of hostage-taking,” the department said in a statement.

The hostage-taking fed a generalized feeling of insecurity and uncertainty in Managua.

“The situation has left (fissures) in the society that are no longer manageable,” said Xabier Gorostiaga, a political scientist and rector at the Jesuit University of Central America. “The government has lost control.”

Nicaragua’s Players

Here are some key players in Nicaragua’s political crisis:

* Violeta Barrios de Chamorro--Her upset victory over Daniel Ortega in 1990 presidential elections came on the back of a broad anti-Sandinista coalition, the National Opposition Union, which deserted her in January over charges she ceded power to the Sandinistas.

* Jose Angel Talavera--Also known as “The Jackal,” he leads at least 400 rearmed Contra fighters who seized a Chamorro government delegation that traveled to his northern stronghold on a mission to offer amnesty to rearmed fighters.

* Antonio Lacayo--Chamorro’s son-in-law and chief of staff, he is instrumental in drafting executive decisions and policies. Lacayo has been accused by the rearmed Contras of guiding the president into a power-sharing arrangement with the Sandinistas.

* Daniel Ortega--The former president remains outspoken and influential as secretary general of the Sandinista party.

* Humberto Ortega--A Sandinista commander during the war, he was a key power behind the junta that ruled Nicaragua after the collapse of the Somoza dictatorship. He stayed on as chief of the armed forces when Chamorro assumed the presidency. He is the brother of Daniel Ortega.