Using FDR as Model, Presidential Hopeful Out to Build New Deal for Mexico

The big question concerns where López Obrador would get the money for his building proposals, as well as to back his promises to increase pensions and lower gas and electric bills. López Obrador has assured voters that he won't raise taxes, and that he will pay for his projects by cutting what he calls unnecessary government. He is counting on loans from the United States and Canada. But he also needs support from the private sector, made up of the business community he has spent much of his campaign railing against as beneficiaries of preferential treatment from Fox's government.

"The problem is that, at the end of the day, it's simply a case of fuzzy math," Arturo Sarukhan, a strategist for Calderón, said in an interview. "He calls bankers 'parasites,' tells businessmen they will see their 'unfair advantages' end, then he expects their help."

López Obrador has taken steps to repair his relationship with Mexico's business leaders. He recently told an audience in Queretaro, a picturesque colonial town northeast of Mexico City, that "we're not against business people as they say," referring to allegations made against him by Calderón. "We are against those who traffic in influence and are corrupt."

Still, the prospect of a López Obrador presidency has made some international investors jittery. He has already taken a position sure to anger American lawmakers, saying he would not honor Mexico's commitment under the North American Free Trade Agreement to eliminate tariffs on U.S. corn and beans. In a recent report, the investment firm Barclays Capital noted "market pessimism about Mexico's July presidential election and the possibility of a L?pez Obrador victory," though his track record as mayor of Mexico City from 2000 to 2005 "does not appear worrisome."

While he was mayor, López Obrador -- known as "Amlo" in Mexico City street slang, a name derived from his initials -- was a prolific builder. He oversaw the renovation of the city's crumbling downtown historic district and added an expensive second deck to an interior highway, which critics say has done little to alleviate the monumental traffic problem in one of the world's largest metropolises.

Kathleen Bruhn, author of "Taking on Goliath: Emergence of a New Left Party and the Struggle for Democracy in Mexico," said L?pez Obrador might encounter resistance from a divided legislature. But she said he may still be able to accomplish some of his goals by applying techniques he employed while he was mayor, such as cutting government salaries and saving money by awarding some service contracts to non-union firms.

"Some of [his proposals] he can certainly pull off," Bruhn said. "In Mexico City he pulled off a lot of things people did not expect him to do."

Calderón has attacked López Obrador throughout the campaign for increasing Mexico City's debt to $3.8 billion by the time he resigned in 2005 to run for president. But Laura Barrientos, an analyst with the credit-rating agency Moody's, said previous mayors had raised the debt more than López Obrador and that his administration did "a decent job of living within their means."

Still, Barrientos said, there is a general uneasiness among investors that a L?pez Obrador presidency would continue "the leftist movement of Venezuela and Bolivia."

"Should López Obrador win," she said, "there may be a lull in investing in Mexico until the market sees what he's doing."

Ever confident, López Obrador is not waiting for the election to woo Wall Street. Not long ago, he sent Camacho on the road for a fancy dinner with investment executives at New York's 21 Club. His mission: persuade America that Mexico can make a New Deal, too.