Thanks T-Top. I separated the two, and it works indeed!
My problem actually was that the system didn't go into cooling mode. I had several things done and am trying to determine which fix actually worked.
First we changed the electrical board which didn't change anything - it just heated. Then I noticed that the orange wire connected to the cooling valve was disconnected further back. Once we connected the wire it just cooled. Now the two wires are disconnected and it works fine.
Can you do a great favor and explain to me why the two wires touching will cause the system not to change to heating mode. Can you believe this??? The HVAC service man offered to come Spring and fall and disconnect/connect the orange wires, because he didn't know where to look. I'd like to give him the technical explanation.