Oct. 3 (Bloomberg) -- Three years ago, members of Brazil's opposition parties were threatening to impeach President Luiz Inacio Lula da Silva amid a widening corruption scandal. Today, those parties' candidates are depicting themselves as his allies to avoid defeat.

Lula, 62, has never been more powerful.

As the former union chief moves into the last half of his second, four-year term, he's poised to extend his influence -- and that of his party -- through local elections Oct. 5. The Workers Party is favored to take city halls around the country. Even its opponents advertise their embrace of the rough-hewn, barrel-chested president.

Local victories would help ensure the party he founded 28 years ago, known as the PT, outlasts his charismatic leadership. Nationally, Lula's 64 percent approval rating, the highest of any president in almost 20 years, may well allow him to anoint a successor in the elections of 2010.

``I don't believe Brazil's next president can be elected without Lula's support,'' said Jose Sarney, the country's president from 1985 to 1990, and now a senator in the ruling coalition. ``A campaign without Lula is like trying to talk about the Gospel without mentioning Christ.''

City Hall

The PT will probably boost the number of city halls it controls to at least 600 from 392, said David Fleischer, a professor at the Federal University of Brasilia. The PT and its allies may also win in big cities, such as Rio de Janeiro and Porto Alegre, and capture as many as 21 of 26 state capitals, he said. In 2004, Lula and his allies won in 11 capitals.

``Local elections are the foyer of the national election, and the Workers Party will become stronger as opposition further dehydrates,'' said Andre Cesar, a senior political analyst at CAC Consultoria.

Lula, whose election in 2002 sparked a sell-off of Brazil's bonds and currency, has presided over the fastest expansion since 1995. Booming prices for commodities such as iron ore and soybeans allowed Lula to cement support.

Brazil's first working-class president, who has an error- prone syntax, has developed a rapport with the lower classes, explaining complex policy choices with homey analogies that translate into political support.

`Tap the Brakes'

When the central bank lifted the interest rate to 13.75 percent on Sept. 10, Lula, an inflation hawk, said raising rates is always ``annoying.''

``It's annoying when the family is traveling in a car and we have to tap the brakes before a curve because that means we can't get where we want to go quite so fast,'' Lula said.

His approval rating of 64 percent is the highest of any president since 1989, when an election was held after a 20-year military dictatorship, according to a Sept. 8-11 Datafolha survey.

``Bar-table talk is probably the best metaphor to explain how Lula addresses the people, and they appreciate his informality,'' said Mauro Paulino, director of Sao Paulo-based pollster Datafolha.

Any association with Lula can be helpful. Wilson Santos, a member of the opposition Brazilian Social Democracy Party running for re-election in Cuiaba, the capital of Mato Grosso, enlisted Lula's sister Ledinava da Silva dos Santos. Santos said in an interview that she's willing to help a member of her brother's main opposition because he ``speaks well about Lula.''

Fair-Weather Friends

In 2005, then-congressman Eduardo Paes of the opposition Brazilian Social Democracy Party appeared on television daily, accusing the government of bribing lawmakers for votes in Congress. At the time, he said it was a scandal that might lead to impeachment hearings against Lula. Now, as a candidate for mayor of Rio de Janeiro, his brochures say a partnership with Lula is ``the first step'' for the city's development.

``It's not correct to express your support for the president when things go well and, when things go bad, accuse him of being the leader of a band of outlaws,'' said Jandira Feghali, one of 12 candidates for Rio de Janeiro, who debated Paes on Sept. 24.

Identification with Lula is so valuable the Workers' Party in the northeast city of Salvador sued in the Electoral Court to stop its coalition partner, the Brazilian Democratic Movement Party, from using Lula's image in campaign material.

Chessboard

To be sure, congressional investigations in 2005 sidelined some of the PT's strongest candidates to succeed Lula. Jose Dirceu resigned as cabinet chief amid allegations he knew about bribes the party paid to lawmakers. Nine months later, Antonio Palocci quit as finance minister amid claims he violated banking secrecy to gain the records of a witness against him in a probe.

``Lula had to rebuild his government after losing two key pieces, Dirceu and Palocci, on his chessboard,'' said CAC's Cesar. ``He had to bring to the front row of the government politicians like his current Chief of Staff, Dilma Rousseff, who were less prominent.''

Polls for the 2010 presidential race show the governor of Sao Paulo state, Jose Serra, leading the race.

Serra's lead in the polls may be deceptive, given Lula hasn't yet championed a candidate to succeed him, said Rogerio Schmitt, political analyst at Sao Paulo-based research company Tendencia Consultoria Integrada.

``Should Lula transfer only half of his popularity, his candidate will at least be in the second round,'' Schmitt said.

To contact the reporter on this story: Andre Soliani in Brasilia at at asoliani@bloomberg.net; Katia Cortes in Brasilia at kcortes@bloomberg.net

Last Updated: October 2, 2008 23:00 EDT