According to Stormin Mormon :
Good guess, but I meant that the capacitor (which is high up in the case,
and the terminals are on the bottom) is rusty. It sure looks to me like the
case of the capacitor is rusty.

Yup, I see that too. And the other capacitor left and below the contactor/relay
(terminals on the top) may be even worse.

[Didn't get a chance to enlarge the picture and go over it carefully until
now.]

If I recall other postings in this thread correctly, the previous serviceman
replaced the original single-can "dual" capacitor with two singles.

In summary: both capacitors are rusty, and at least one of the
contactor/relay unit connection terminals is more-or-less heat and
corrosion destroyed - the gray/blue "staining" on the terminal mounting
'ear' (plastic or bakelite, likely the latter) shows it's been grossly
overheated - the metal strap and screw are _badly_ damaged, and it should
not be trusted.

[Another terminal may be just as bad, but none of the pictures show
sufficient closeup detail.]

I think the OP needs a _reputable_ serviceman come visit and test out
the entire thing.

If he stays with two capacitors, the one with the terminals facing
"up" should be inverted. As it is, it's a water/rust trap.

Given the sloppy workmanship, I'll bet that the capacitor values are grossly
wrong, which could lead to wires melting too.
--
Chris Lewis, Una confibula non set est
It's not just anyone who gets a Starship Cruiser class named after them.