"Broken Rainbow," the winner of this year's Academy Award for Best Documentary, tells the story of the 1974 Navaho-Hopi Land Settlement Act, which, as the movie would have it, is all of a piece with the depredations of the white man since the days of General Custer and Kit Carson.

In "Broken Rainbow," we learn how Congress tore the Navahos from their land, relocating them in tract houses, never realizing that the land was sacred to the "native people"; that their livestock were impounded and slaughtered; and that behind the relocation was a conspiracy among Congress, big business and the Indians' own lawyers to rape the land for its minerals, mostly coal.

Presumably, "Broken Rainbow," which was produced, written and edited by Maria Florio and Victoria Mudd (and directed by Mudd), didn't win its award for subtlety. The force of the documentary is mostly emotional, powered by images of bloody, hacked sheep and pathetic old people bemoaning their fate (their voices don't quaver, but the translator's does). A typical visual strategy of the movie is to crosscut post-card-style vistas of the Southwest with noisy shots of backhoes tearing up the land.

There is something missing in "Broken Rainbow" -- mostly the facts. Coverage of the controversy in The Washington Post, for example, shows that the struggle was only tangentially between the Indians and Congress or big business; at the heart of the matter was a conflict between the Hopi and Navaho tribes that was at least a century old, and, more particularly, within the Hopi tribe itself regarding development of the region and Hopi participation in mining profits.

A sort of friendly enmity had prevailed in Hopi-Navaho relations for centuries, ever since the Navahos appeared in what was then Hopi territory. Today, the Navaho reservation surrounds the Hopis. Relatively few of the Navahos (8,000 out of a tribe of 135,000) were relocated by Congress (a percentage that, if the movie mentions it, is quickly lost in the emotional tide); Navaho sheep were impounded and killed not out of some free-floating corporation cruelty or to drive the Indians off the land, but because the land simply wouldn't support them -- they were trespassing on Hopi soil.

While the relocation and mineral development of the region will probably work to erode traditional Indian culture, and will be particularly difficult on the elderly, it will also provide jobs and money. Indian participation in mineral revenues was projected to total $100 million over 30 years, another fact that is slyly elided by "Broken Rainbow" (which chooses to talk not in dollar terms, but in terms of the percentage of total revenues). For this reason, such issues split the communities between progressives, who wanted to assimilate the tribes into modern culture, and traditionalists, who wanted to keep things, as nearly as possible, as they were.

Such a story, though, simply wouldn't fit through the ideological lens of "Broken Rainbow" -- which is too busy talking about the Indians' superior connection to the land and their innate incomprehension of the concept of private property to have much truck with what actually happened. The movie, determined at all costs to ignore what was in fact a property dispute, is a morass of sentimental leftism of the worst sort, glorifying the Indians' homely practices, their grinding of corn and intimacy with their herds of sheep and knowledge of healing herbs and plants and dancing with rattlesnakes in their teeth (which, we are told without irony, made the rains come), and how it all "echoed within the archaic womb of human consciousness few whites could understand."

"Broken Rainbow" continually makes the spectacularly unsupported claim that several of the relocated people died of strokes as a result of the relocation, when it would seem to have more to do with all the lamb they seem to eat. It insists on seeing the world as a Manichaean struggle between good primitives and evil greedheads intent on destroying the Earth.

That perspective tends to disrupt the facts. Lawyer John Boyden, for example, is excoriated as Greedhead No. 1. On what basis? Well, he got a million-dollar fee, and he purportedly worked for both the Indians and the mineral companies. What the documentary fails to mention is that Boyden worked on the case for 26 years to earn his million, not a princely wage by legal standards; and that the million included a bonus of $220,000 paid in gratitude by the Hopis for taking the case when no one else would.

Alongside "Broken Rainbow's" flair for distortion is a fondness for cheap shots (President Ford is attacked for signing the bill on a ski trip -- wasn't he just trying to get closer to the land?), dubious claims (we are told an emotionally disturbed child was cured by two days of chanting and the rattling of rattles), grotesque distortions (among those wearing jackboots here is Mo Udall, of all people), and specious analogies (including the usual one to the Holocaust).

"Broken Rainbow" does little to dignify the claims of its heroes, who come across as whiners ("We have to pay for everything -- electricity, water, the land," complains one old woman, as the translator quavers away). The shame is that "Broken Rainbow" could have been, at the least, a marvelously complex and layered political drama, and possibly a genuine tragedy, in the sense of equally valid moral positions in hopeless opposition -- that it could have held the values of tradition and modernity in equal regard.

But "Broken Rainbow" fails at that, and of the reasons for failure, I have only the gravest suspicion. The Navahos have already spent millions for public relations and legal fees (at one point they hired Hill & Knowlton). As Abbott Sekaquaptewa, chairman of the Hopis, told The Post in 1980, "These are not poor, illiterate people who don't know the white man's ways. They're the smartest people I've ever run up against . . . They've led the white man's government around by its nose for years."

In that context, it's remarkable that nobody thought of a movie before.

Broken Rainbow, at the West End Circle, is unrated.