By Monica Campbell | Contributor to The Christian Science Monitor

MEXICO CITY - The man in the frumpy suit stepping out of his Nissan at 6 a.m. in Mexico City's main plaza is the most watched politician south of the border.

Andrés Manuel López Obrador's job - running a city plagued with crime and pollution, and thick with traffic - is considered one of the toughest in Latin America. But he has built new roadways to ease gridlock; opened new schools, including the city's first state university; built low-cost housing, and, most recently, launched a first-ever plan to provide residents over 70 with a monthly subsidy of $60 for basic needs.

Even as a political scandal consumes members of his party, the mayor's management of the capital has him pegged in most opinion polls as the front-runner to succeed President Vicente Fox when his term ends in 2006.

Mr. Fox is heralded for breaking the 71-year grip on power held by the Institutional Revolutionary Party (PRI). But he has shown little progress since taking office in 2000. The economy remains sluggish, unemployment is up, and major reforms are stalled in Congress.

"Mexico is a classic new democracy, and voters are looking for leaders that are both honest and competent. And Mr. López Obrador is all that," says political scientist Federico Estévez of the Autonomous Technological Institute of Mexico, a leading university.

The mayor's leftist, anti-US politics sit well with the vast number of marginalized Mexicans, who denounce market policies that skimp on social programs.

López Obrador rejects many of the ideas that Fox supports, such as selling off the state-owned oil monopoly to foreign interests. He questions the benefits of the North America Free Trade Agreement, saying that Mexican farmers have received "absolutely nothing" from it.

The mayor's harshest critics say he is a quixotic populist, like Venezuela's leader, Hugo Chávez, who has sent the once oil-rich economy sinking. Others call him "Mexico's Lula," referring to Brazil's President Luiz Inácio Lula da Silva, who softened his radical politics to appeal to both leftists and capitalists.

López Obrador started out in the PRI, but in 1998 he split with the party. He blocked entrances to PRI-controlled oil wells, arguing that they were destroying the environment and making corrupt politicians rich. He then helped create the left-leaning Party of the Democratic Revolution (PRD). In 2000 he became Mexico City's second elected mayor.

But like Lula, the mayor has since softened his firebrand political image. He has struck unconventional alliances with figures like Carlos Slim, Latin America's richest man. Mr. Slim is helping López Obrador restore much of Mexico City's run-down historic center.

He also has hired Rudolph Giuliani, New York's former mayor, to develop a zero-tolerance policy toward crime.

"He's making pacts with constituencies on many different levels, from the church to the private sector," says José Gil Olmos, a veteran political reporter for the weekly magazine Proceso.

López Obrador's austere image keeps him popular. The silver-haired widower lives in a modest apartment, passes up foreign junkets, and has cut his own salary. He's at work at 6 a.m. to hold his daily press conference.

Yet he has his detractors. Some argue that building expensive new highways should not come before providing basic services. "We don't need more freeways. We need electricity," says Margarita Colchado, who protested with her neighbors in front of City Hall recently because her community lacks power.

Roberto Madrazo, head of the PRI and a presidential aspirant, says López Obrador's projects and handouts are ploys that risk sinking the city in debt. López Obrador counters that the city's debt is under control.

Despite his clean record, a series of videos have surfaced showing high-level politicians from his own party negotiating bribes and stuffing cash into briefcases. The scandals have allowed the mayor's opponents to unleash a wave of criticism against him. So far, he has avoided direct implication. "There is not going to be any video of López Obrador [receiving money] because López Obrador is not corrupt," the mayor said.

But residents like Betty Franco say they will stick by him. "He seems innocent, not the typical politician who is just out to make himself rich," she says. "I've never voted before, but I'll vote for López Obrador in 2006."