The 4matic light is on n only the rear wheel drive is working? on 1993 Mercedes-Benz 300E 4MATIC

It has a switch in the engine compartment that is labeled 1 and 2, and the 4matic light on the dashboard is on. I have tried both positions with no changes on the engine compartment switch. It was this way when I bought it but did not know there was a problem until the first snowfall when I could not get out of my driveway :(

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