The stories have both transfixed and enraged the Brazilian public in recent days: suitcases stuffed with cash, backroom payouts to lawmakers, a governing party allegedly buying support for its agenda.

Last week, a congressman testified that top aides to President Luiz Inacio Lula da Silva knew that the Workers' Party -- the bedrock of Lula's political base -- was offering millions of dollars in bribes to legislators. Lula denied knowing about the payouts, but the probe has raised difficult questions for a man who in 2002 received more votes than any presidential candidate in the nation's history.

"People don't necessarily think of Lula as corrupt, because he says he didn't know what was going on," said Jose Luciano de Mattos Dias, a political scientist at the Research University of Rio de Janeiro. "But that is the point: He didn't know. What else doesn't he know?"

The crisis developed two weeks ago when a Brazilian magazine obtained a videotape of a postal service manager appearing to accept a bribe from a businessman who was competing for a government contract. On the tape, the postal manager said such payments were widespread and named congressman Roberto Jefferson as one of those accepting bribes.

Jefferson, president of the Brazilian Labor Party, denied wrongdoing, and Lula publicly supported him. But the statements Jefferson has made to try to clear his name have elevated a small-time scandal into a full-blown crisis for the president.

Jefferson testified last week that Lula's party offered each Labor delegate $12,500 per month to support its initiatives. Jefferson said he refused the bribe but knew that some lawmakers had taken the cash. He said Lula's chief of staff and finance minister knew of the payouts and said he told Lula of the bribes earlier this year.

"The president was shocked, and tears fell from his eyes," Jefferson told a congressional panel. "President Lula is innocent. He put a stop to the bribery."

Lula's public tone since the scandal broke has been firm, promising a full investigation and a package of anti-corruption reforms. On Thursday, he accepted the resignation of his chief of staff, Jose Dirceu, who was implicated by Jefferson in the scandal.

"We will leave no stone unturned," Lula vowed in his weekly radio program. "As the father of five children, I am infuriated by corruption that misuses money that could be used to help develop this country. We need to show Brazilian society that it is possible to abolish corruption for good."

While most Brazilians appear unwilling to hold Lula personally accountable for the alleged bribery, faith in the government and its ability to control corruption has clearly eroded. Although Lula, 59, remains personally popular, recent opinion polls show his public support has dropped.

Before he became president, Lula regularly held court at the Bar da Rosa, a smoky cafe in this blue-collar neighborhood outside Sao Paulo. Each morning he dropped in to read the paper, and in the evenings he filled the room with the machinists and auto workers he represented in the Worker's Party.

Adailton Pinheiros, a retired auto worker, voted once for Lula to lead his union and a second time for him to lead the country.

"Now everyone's complaining, and I am, too," said Pinheiros, 50, who said corruption seemed ingrained in Brazilian politics. "If the election were today, I don't know that I would vote for Lula."

Perhaps it's lucky for Lula that the election isn't today. The economy was sluggish before the scandal broke, and in a survey released two weeks ago, about 45 percent of Brazilians responded negatively when asked to evaluate Lula's administration.

But few in Brazil are writing off Lula. The one-time lathe operator has built an unlikely political career out of overcoming obstacles and defying expectations. Although his personal approval ratings have fallen for three consecutive months, polls show he would trounce any of a number of possible presidential contenders.

Lula still keeps his apartment in Sao Bernardo, and the district contains other landmarks from his career: the metal workers' headquarters where he organized picket lines; the soccer stadium where he rallied thousands during a general strike; the jail where he was incarcerated in 1980 for leading a work stoppage.

The obstacles Lula hurdled on his road to the presidency included the death of his pregnant first wife, a factory accident that claimed a finger and three presidential defeats between 1989 and 1998.

The current crisis is just one more instance in which Lula's supporters cite the credo: That which does not kill him makes him stronger.

"I trust in Lula so much that when I'm watching TV and they start to criticize him, I turn the channel," said Luiza Maria Farias, 67, who once cooked for picketing workers who Lula led. "All the critics, they're not to be believed. If I knew any of them, I'll go to their houses and beat them once over the head with my cane."

That kind of devotion, supporters said, is a direct result of Lula's championing of labor and social movements at a time they were being repressed by military governments that ruled between 1964 and 1985.

Rubens Teodoro de Arruda, 69, once shared a windowless jail cell with Lula, each of them stripped to their underwear to battle the heat. Years before that, both attended a public speaking class where Lula tried to overcome his shyness in front of crowds.

"He was always afraid to talk into a microphone," recalled Arruda, a retired autoworker. "They told him to look into people's eyes . . . and to clearly deliver all of the ideas that he had in his head."

These days Arruda admits to being frustrated with the lack of progress in the kind of social programs Lula hoped would redistribute wealth in this vastly imbalanced society. But like many other fans, he doesn't blame the president.

"Lula is human, and he has faults," Arruda said. "His problems are a result of the people he's put around him; they should assist him better. They are always saying 'Yes, yes,' but sometimes they need to tell him 'no.' "

Edson Vidigal, president of Brazil's Supreme Court, said too much power is in the hands of the fragmented congress, which is led by one of Lula's most outspoken opponents, Severino Cavalcanti. Brazilian presidents must negotiate with legislators individually, Vidigal said, and most quickly drain their political capital.

"All Brazilian presidents have a lot of gas during their first and second years," Vidigal said. "But during their last two years, they all become exhausted."

Lula, he said, should have taken Cavalcanti more seriously before he stunned the country by becoming head of the legislature in February. In his new position, Cavalcanti has urged the government to drop a planned tax increase and demanded more control of the federal budget.

Failing to create coalitions in Brazil, Lula has looked abroad. He has tried to build partnerships with other developing countries, particularly in South America and Africa. By taking the lead in strengthening the collective hand of the world's poorest nations, Lula hopes Brazil can strengthen its own position, aides said.

"What we are doing in the international arena corresponds to a large extent to what the Worker's Party did here," said Celso Amorim, Brazil's foreign minister. "We are trying to organize sectors outside of the current power structure, and do it in a democratic way."

The approach has stirred some tension among Brazil's neighbors, who view Lula as operating unilaterally at times rather than promoting regional interests. Brazil is lobbying for a permanent seat on the U.N. Security Council, but many other Latin American countries would prefer a rotating seat. Argentina's foreign minister recently slammed Lula's quest as "elitist and hardly democratic."

Such spats haven't stopped Lula from promoting regional partnerships such as the South American Community of Nations, Amorim said. He said he believed Lula's work to raise Brazil's profile abroad was inspiring for many Brazilians, who relate to the struggles their president has overcome.

"If you looked at Lula 30 years ago and said, 'This guy will be president of Brazil,' people would have said you were mad," Amorim said. "He fought all the improbabilities."

Researcher Lilian Cunha in Sao Paulo contributed to this report.

President Luiz Inacio Lula da Silva, right, has denied knowing of payoffs.Statements by Rep. Roberto Jefferson have intensified the scandal.