"Morales is acutely aware of the symbols, both in terms of the indigenous identity of the country and by setting the standard for cutting salaries," said Michael Shifter of the Inter-American Dialogue in Washington.

"But now the test is, 'Can he follow through?' ... Ultimately, he will face real decisions," Shifter added.

Other leaders have introduced salary cuts. In January 2002, Ecuador's President Lucio Gutierrez took a 20 percent voluntary pay cut to $5,120 monthly. A year earlier, Peruvian President Alejandro Toledo announced he would cut his pay to $12,000 a month after critics denounced a plan for an $18,000 monthly salary. Protests were so loud he had to cut it again to $8,400.

Riordan Roett, professor of Latin American studies at Johns Hopkins University's School of Advanced International Studies in Washington, said Morales' media-savvy steps showed he was a "much more assertive chief executive" than many thought.

He noted that Morales began by naming a Cabinet heavy with Indians, social leaders and women, then shook up the military, promoting officers who will be loyal to the new leader.

"These two events, coming with the salary issue ... (are) decisions that play out very well in the streets with the poor," Roett said.

But bigger issues are yet to come, including implementation of Morales' promise to nationalize Bolivia's natural gas reserves.

"He has done things in the short term that will bolster his support, by moving on salary cuts," Roett said. "The next thing, now will be the energy issue and that's the critical question ... and an important sign of how radical he will be."