Because of an editing error, an article yesterday asserted that "the government of Nicaragua is communist, while El Salvador has a democratic government." This statement should have been identified as the view of some participants in a dispute about whether refugees from both countries should have the same status under U.S. immigration law. (Published 7/10/87)

Attorney General Edwin Meese III said yesterday that as many as 200,000 illegal aliens from Nicaragua, now inside the United States, will be allowed to remain under a liberalized immigration policy.

Meese signed a controversial order, after consultation with the White House, ensuring that no Nicaraguan "with a well-founded fear of persecution" from the leftist Sandinista government will be deported unless he has "engaged in serious criminal activity or poses a danger to national security."

Nicaraguans will be permitted to remain in the United States "for the present" under Meese's order, which "is effective until further notice," the Justice Department said.

The move came under immediate attack by members of Congress who have been pushing for the administration to create an exception for Salvadorans, as well as for Nicaraguans, because refugees from both countries face similar conditions if they return. The government of Nicaragua is communist, while El Salvador has a democratic government.

Rep. John Joseph Moakley (D-Mass.), who despite administration opposition has worked for two years to pass legislation to suspend deportations of Salvadorans and Nicaraguans, charged that the "Reagan administration is playing politics with people's lives . . . . To ignore any mention of El Salvador is to turn a cold and callous shoulder on refugees who have fled a violent civil war.

"This government is crazy," Moakley said. "If El Salvador were under communist leadership, they'd have the welcome wagons out waiting for them to land."

Moakley's bill was approved last week by the House Judiciary Committee and is expected to reach the House floor later this month. A similar bill is to be prepared today in the Senate Judiciary Committee.

Sen. Dennis DeConcini (D-Ariz.), sponsor of the Senate bill, criticized the "obvious political motives" behind the administration decision and urged the Immigration and Naturalization Service also to suspend deportations of Salvadorans based on "nonpolitical, humanitarian grounds."

The administration has testified that it opposes the legislation because it fears it would undermine new laws designed to discourage illegal immigration.

In May, the Reagan administration turned down a plea from Salvadoran President Jose Napoleon Duarte that thousands of illegal Salvadoran refugees not be forced to return to his country. He said the ailing Salvadoran economy would be further crippled because so many refugees send their U.S. dollars to relatives in El Salvador. But the administration feared such a move would imply the Duarte regime, which Reagan supports, is unstable.

The INS estimates there are 150,000 to 200,000 Nicaraguan exiles nationwide and and as many as 500,000 Salvadorans.

Every qualified Nicaraguan seeking a work authorization will be entitled to one, according to the Justice Department. Also, Nicaraguans whose claims for asylum or withholding of deportation have been denied will be encouraged by the INS to reapply.

Sen. Bob Graham (D-Fla.), whose state is believed to have as many as 75,000 Nicaraguans, praised the administration's action as an appropriate response to the "authoritarian, communist nature" of the Sandinista regime. "Nicaragua represents a dilemma for America. We want strong enforcement of immigration laws but we also have to face reality -- we're not going to deport them back to a communist government," Graham said.

Nicaraguan exiles have protested the stringent U.S. immigration policies applied to them at the same time that the U.S. government has treated the Sandinista government of their homeland as an enemy by aiding the contras. Last month, 100 children of exiles went to Washington to demonstrate outside the White House, the State Department and the Capitol.