DAILY SUMMARY OF JAPANESE PRESS 03/13/07-2

UNCLAS SECTION 01 OF 08 TOKYO 001090

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SUBJECT: DAILY SUMMARY OF JAPANESE PRESS 03/13/07-2


INDEX:

(10) Defense minister, US consul general agree to expedite Futenma
relocation

(11) Aso hits Nakagawa's head for nuke argument; Public opinion
skeptic like grandfather

(12) Six-party talks on North Korea a tough test for Abe's
diplomacy

(13) Editorial: Anti-amakudari measures; Questiong prime minister's
enthusiasm

(14) Big-rigging practices - Plunge scalpel into collusive ties
(Part 2): FTC, prosecutors launch offensive in response to
taxpayers' desire

ARTICLES:

(10) Defense minister, US consul general agree to expedite Futenma
relocation

RYUKYU SHIMPO (Top play) (Full)
March 12, 2007

Defense Minister Fumio Kyuma, who arrived in Okinawa Prefecture on
March 10, met with US Consul General Kevin Maher in the town of
Haebaru yesterday afternoon to exchange views, and the two agreed to
relocate Futenma airfield as early as possible. After meeting with
Maher, Kyuma stressed to reporters that he did not discuss any
revisions to the Futenma relocation plan. Maher avoided referring
directly to his meeting with Kyuma. "I don't want to say anything
specific," he said.

Kyuma told reporters: "I heard the consul general's frank views and
impressions of Okinawa. He told me: 'In my view, the base issue is a
matter of the third interest or so to the residents of Okinawa
Prefecture. I think they are more interested in the economy and
employment.'" Kyuma also explained why he had visited Okinawa: "I
wanted to hear a third person's view other than those of government
and prefectural officials. I can meet the governor and the (Nago)
mayor in Tokyo. But the consul general is posted here to cover this
area, so I can't meet him unless I come down here."

Asked about revising the relocation plan, Kyuma said: "I know he
will answer the current plan is the best one, even if I ask about
it. I am not that much of a dunce as to ask about what I know
already."

Maher said: "Basically, both governments with the same purpose in
mind have agreed to carry out the (Futenma relocation) plan as soon
as possible, while lightening the burden of Okinawa and maintaining
our (US military) capabilities. I think more than half of Okinawa
Prefecture's people will support this plan if they understand how
much it will benefit Okinawa."

(11) Aso hits Nakagawa's head for nuke argument; Public opinion
skeptic like grandfather

ASAHI (Page 1) (Full)
Eve., March 8, 2007


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Less than a month after the Abe cabinet came into office, a row
broke out over whether the propriety of Japan debating the pros and
cons of arming itself with nuclear weapons.
Last Oct. 9, North Korea conducted a nuclear weapon test. Shortly
thereafter, Shoichi Nakagawa, 53, chairman of the ruling Liberal
Democratic Party's policy board, appeared on a TV talk show that was
aired Oct. 15. Nakagawa there advocated discussing the nuclear
option for Japan to deter an armed attack. "We must discuss the
matter," Nakagawa said.

Nakagawa has worked together with Prime Minister Shinzo Abe, 52, on
the issue of Japanese nationals abducted to North Korea and the
issue of history textbooks for school use. Did this sworn friend of
Abe mean to say Japan also should have nuclear weapons-practicing an
eye-for-an-eye principle?

About a month before that, a PHP INTERFACE-published book hit store
shelves. The book, Nihon Kakubuso no Ronten (Point at issue: Japan
arming itself with nuclear weapons),was co-authored by Terumasa
Nakanishi, 59, a professor at Kyoto University. In the book,
Nakanishi openly developed an argument advocating Japan going
nuclear. Nakanishi is one of the scholars on Abe's brain trust.
Japan has avowed its three principles of not producing, possessing,
or introducing nuclear weapons. How far does Abe listen to the
arguments of Nakanishi and other brain trusters?

The foreign minister in a public gathering gave someone a clout on
the head. Such a singular incident took place on the evening of Oct.
16, the day after Nakagawa made the remarks. It was at a reception
for exchanges between Japan and China. Among those at the reception
were Wang Jiarui, chief of the Chinese Communist Party's
International Liaison Department, and Wang Yi, Chinese ambassador to
Japan. In their presence, Foreign Minister Taro Aso, 66, suddenly
gave Nakagawa a clout on the head.

"This man said what's unnecessary without thinking over TPO (time,
place, occasion),so I'm very troubled."

Aso is a grandson of Shigeru Yoshida, who was known as a one-man
premier. Aso studied abroad and later became president of Aso Cement
Co., Ltd. He entered politics at the age of 39. In July last year,
North Korea launched missiles. Then, Aso, as then Prime Minister
Koizumi's foreign minister, moved quickly to work on the United
Nations Security Council for a resolution imposing sanctions on
North Korea, and he built a relationship of mutual trust with Abe,
who was Koizumi's chief cabinet secretary.

America is wary of arguments in Japan about a nuclear option. Aso
called US Secretary of State Condoleezza Rice later in the day after
North Korea's nuclear test. "I would like the United States to
declare that it will take every possible measure to defend Japan,"
Aso asked Rice. "Otherwise," he added, "it may give rise to
arguments calling for Japan to go nuclear." Rice later visited
Japan, and she stressed that the United States would defend Japan
under its nuclear umbrella.

Aso forestalled the moves of nuclear advocates. On Oct. 18, however,
Aso, who was guarded against the rise of arguments for the nuclear
option, stated in the Diet: "When a neighboring country came to have
(nuclear weapons),it's also important to discuss (the advisability
of Japan's nuclear possession)."

What did Aso really mean?

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After several drinks, Aso often talks about former Foreign Minister
Jutaro Komura, who concluded peace in the Russo-Japanese War, and
Yosuke Matsuoka, who headed the Japanese delegation when Japan
walked out of the League of Nations (in 1933).

"Komura, who saved Japan from collapse, was treated as a traitor
among those who insisted on going to war. Matsuoka, who made the
decision leading Japan to ruin, was greeted with a big applause. The
Japanese people are easily swayed by the mood at the time."

Aso's cynical way of speaking-inherited from his grandfather-shows
his skepticism of public opinion.

"It would be better not have nuclear weapons. Why? If we only cry
out against nuclear weapons emotionally without discussion, we will
work up a strong mood for pitting nuclear weapons against nuclear
weapons when the threat from North Korea becomes even more
realistic." With this, Aso thinks it would be better for Japan not
to have nuclear weapons. What he fears is a "mood" that cannot be
stopped.

Shigeru Ishiba, 50, an LDP lawmaker, was suddenly asked by Aso to
take over his nuclear argument. "I've done it to this extent, so
I'll leave the rest to you," Aso said to Ishiba. "Why me?" Ishiba
was at a loss. Later on, however, Ishiba argued in Shukan Asahi that
the nuclear debate must not be suppressed. He said, "It's not in the
interests of Japan to possess nuclear weapons because there are many
more negative aspects than positive aspects.

Ishiba listed the downside by saying: "Japan depends on atomic power
generation for 40% of its electric power. Fuel imports,
reprocessing, and technology transfer will stop. In time, Japan's
atomic power plants will shut down." Another downside he cited was
that "Japan's neighbors would also go nuclear."

At one time, it was taboo for cabinet ministers to talk about a
nuclear option. Breaking a taboo used to result in their apologies
or even resignations. This time, Aso has not revised his nuclear
remarks. He half broke the taboo on a nuclear discourse. However, by
sounding as if he is insisting only on freedom of discussion, the
effect could be to incite Japan to go nuclear.

In a parliamentary one-on-one debate held in November last year
Ichiro Ozawa, 64, president of the leading opposition Democratic
Party of Japan (Minshuto),criticized Abe for the nuclear arguments
coming from his cabinet and the ruling party. Abe, in his rebuttal
to Ozawa, argued: "It's also part of the nuclear debate to say we
should not have nuclear weapons." With this, Abe said he condoned a
nuclear debate. Abe later said: "Mr. Ozawa once said, 'Japan can
make nuclear weapons at any time.' He has said a lot of things. I
thought to say, 'I'm not so radical like you.' But I left it
unsaid."

(12) Six-party talks on North Korea a tough test for Abe's
diplomacy

ASAHI (Page 15) (Abridged slightly)
March 13, 2007

By Hiroshi Hoshi, senior writer

Fierce international maneuvering is underway over North Korea's

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nuclear programs. The United States and Japan separately held talks
with North Korea, but the North is clinging to its "nuclear card."
The North is also trying to isolate Japan, which wants to resolve
the abduction issue. Mr. Principle and Mr. Reality discussed the
significance of the six-party talks on the North Korean nuclear
issue.

Mr. Principle: "Throughout the talks with his US counterpart in New
York, the North Korean negotiator was wearing a smile. Washington
has decided to partially lift its financial sanctions on Pyongyang,
and the North apparently wanted to play up its friendliness.
Meanwhile, in the talks with Japan in Hanoi, the North repeatedly
insisted that the abduction issue had been settled. It clearly
reflected Pyongyang's intention to exclude Japan from the
multilateral framework."

Mr. Reality: "The six-party negotiations have proceeded as a five
against one game for North Korea and Japan. The North is trying to
isolate Japan from the rest of the members. Japan, on the hand, is
trying to tighten the noose around the North with the four other
countries. The alliance with the United States is a great advantage
for Japan. China, South Korea, and Russia would not even try to
compete with the strong Japan-US alliance. Shortly after taking
office, Prime Minister Shinzo Abe visited China and South Korea, and
that helped greatly to improve relations with those countries. North
Korea has futilely tried time and again to drive a wedge between
Japan and the United States."

Principle: "Will the Foreign Ministry be able to handle the matter
deftly?"

Reality: "Vice Foreign Minister Shotaro Yachi, who is the top
working-level official, is Prime Minister Abe's brain trust. A
quarter of a century ago, Shintaro Abe was a secretary to his
father, Shintaro Abe, who was then foreign minister. Yachi at the
time was a secretary to a vice foreign minister. Working in the
rooms adjacent to each other, the two cultivated a friendship that
remains vibrant today.

Ambassador for Japan-DPRK diplomatic normalization talks Koichi
Haraguchi is a seasoned diplomat who served in such posts as
ambassador to the United Nations. Asian and Oceanian Bureau Director
General Kenichiro Sasae, chief negotiator in the six-party talks, is
fully aware of Pyongyang's intention, having served as chief of the
division responsible for North Korean affairs. Deputy Director
General Junichi Ihara, who is serving as an assistant to Haraguchi
and Sasae, is a cool-headed mid-level official, who served in such
posts as minister to the United States after pursuing studies at
Harvard University. The Foreign Ministry's lineup is powerful."

Principle: "The North is expected to apply pressure on Japan and the
United States in the next round of the six-party talks slated to
open on March 19."

Reality: "University of Tokyo Prof. Akihiko Tanaka, an expert on
international politics, wrote that the objective of the six-party
talks was to 'make deals' rather than to force the North into
submission. I agree with him. In the talks in February, the members
decided on a set of minimum steps designed to prevent North Korea
from pursuing nuclear development. Japan must join efforts with
other countries to ensure that North Korea will deliver on its
promise. After all, the North Korean nuclear threat is most serious
for Japan. The public in the US has become increasingly aware of the

TOKYO 00001090 005 OF 008


abduction issue, as well. The abduction issue has taken on an aspect
of families of abductees working upon public opinion of other
countries through the media and prompting their governments to make
moves."

Principle: "Japan harbors many concerns, as well. First, the Bush
administration might go ahead and improve relations with North Korea
behind Japan's back. The Bush administration wants to achieve
visible results on this issue, but it has less than two years to do
so. China and South Korea's strong reactions to Prime Minister Abe's
remarks on the comfort women issue might rekindle the row over
historical views.

According to a certain cabinet minister, Abe has not given up the
option of visiting Yasukuni Shrine. The minister predicted that Abe
would visit the controversial shrine by this fall marking the first
anniversary of his assumption of office. His visit to the shrine is
certain to strain relations with Beijing and Seoul and eventually
take a toll on the six-party talks."

Reality: "The focus is now on the extent to which Abe can discuss
matters with President Bush during his visit to the United States in
late April. The comfort women issue and a visit to Yasukuni Shrine
depend on Abe's own decisions. According to a senior government
official knowledgeable about the North Korean situation, Pyongyang
is attentively watching how this summer's Upper House election will
turn out. Pyongyang apparently intends to determine its response to
Japan after observing the results of the election, which can dictate
the fate of the Abe administration."

Principle: "The six-party talks are Japan's first full-fledged
diplomatic game over security in East Asia. They are a tough test
for Abe, who has made his name by taking a hard-line stance toward
the abduction issue."

(13) Editorial: Anti-amakudari measures; Questiong prime minister's
enthusiasm

MAINICHI (Page 5) (Full)
March 13, 2007

State Minister for Administrative Reform Yoshimi Watanabe last week
presented a set of proposals for totally prohibiting government
agencies from providing placement services for retiring bureaucrats.
However, this proposal came under a barrage of criticism. This
reaction of the LDP to Watanabe's proposal for reforming the public
servant system is obvious proof of the actual situation of the Abe
administration. Their reaction gave us the impression that the scene
of government agencies and concerned lawmakers resisting a reform
drive in unison as seen in the past has come back.

Proposals Mr. Watanabe offered included: (1) ending the current
practice of individual government agencies providing placement
services to bureaucrats who want to land jobs at private companies
they previously regulated and instead establishing a human resources
bank to be solely responsible for that job; (2) prohibiting
government agencies from engaging in activities to find jobs for
retiring bureaucrats at companies and organizations that have
connections with their budgets and authority and retired bureaucrats
from illegally working on the agencies to which they belonged; and
(3) establishing penalties against unlawful activities, while
monitoring wrongdoings through the introduction of an external
monitoring system involving experts.

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The practice of amakudari means the chief of each minister's
secretariat and other senior officials try to secure

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after-retirement jobs for their bureaucrats, thereby encouraging
them to retire before they reach mandatory retirement age. It goes
without saying that in the bureaucrat-led bid-rigging that involved
a floodgate construction project, the Ministry of Land,
Infrastructure and Transport (MLIT) took into consideration how many
retired MLIT officials bidding companies accepted in placing
construction orders. It has been repeatedly pointed out that
amakudari is the hotbed for collusive ties between bureaucrats and
companies. However, the government has never dug into the very
proclivity of the bureaucracy for a long time.

There are a number of hurdles for Watanabe's proposals, including to
what extent the proposed human resources bank can function. However,
it is certain that most people have taken the proposals as only
natural. However, government agencies unanimously opposed the
proposals. As if to speak for them, a number of lawmakers opposed
the proposals with one saying, "It is too strict to totally ban job
placement activities" or another noting, "The proposals are based on
the notion that everything done by the bureaucracy is bad." Cabinet
ministers followed suit voicing a cautious argument.

It is said that though the state minister for administrative reform
wants to totally scrap job placement activities by government
agencies by April 2009, the LDP is preparing a proposal for delaying
the time-line for a shift to a human resources bank to April 2018 or
later. Does it mean that government agencies have already planned
amakudari schedules several years down the pike? Setting the
time-line at more than 10 years ahead is tantamount to that they
have no intention of reforming amakudari.

Private-sector members of the government's Council on Economic and
Fiscal Policy first proposed the idea of prohibiting government
agencies from providing placement activities for retiring
bureaucrats. LDP Secretary General Hidenao Nakagawa also began
proposing a similar idea around the same time. Mr. Nakagawa appears
to be motivated by the desire to fight the Upper House election on a
platform of reform of the public servant system, making a public
appeal that the Democratic Party of Japan (DPJ or Minshuto),which
receives support from government and municipal trade union bodies,
is not eager to carry out reform.

Apart from such a politically motivated calculation, we do not feel
enthusiasm for reform of the public servant system from Prime
Minister Abe, compared with his eagerness to pass a national
referendum bill stipulating procedures for constitutional revision.
Mr. Nakagawa said, "Prime Minister is determined. This issue will
reveal the prime minister's mettle." Is that really so?

Some LDP members are reportedly criticizing the proposals saying,
"(The state minister for administrative reform) thinks the
government can receive support from people if he offers extreme
proposals." This comment probably bears out that the LDP has
backslid to its the old-guard nature of defending its vested
interests. Reform means pressing ahead with even drastic proposals,
if necessary. The prime minister is being put to the test regarding
how seriously he is reform-oriented.

(14) Big-rigging practices - Plunge scalpel into collusive ties
(Part 2): FTC, prosecutors launch offensive in response to
taxpayers' desire

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NIHON KEIZAI (Page 1) (Excerpts)
March 9, 2007

The Fair Trade Commission (FTC) secretly launched an investigation
last December into a bid-rigging case in a municipal subway
construction project commissioned by the city of Nagoya.
Investigators from the office responsible for examining criminal
cases - newly set up in the FTC under the revised Antimonopoly Law -
started questioning employees of the general contractors allegedly
involved in the bid-rigging case, in cooperation with the Nagoya
District Public Prosecutors Office.

The FTC prosecuted five general contractors, including Kashima
Kensetsu Co., and arrested five responsible officials of the five
companies in late February, including Masahiro Shibata, 70, a former
advisor to the Nagoya branch of Obayashi Corp. Shibata is said to
have been the coordinator for collusive arrangements to rig bids for
projects in the Chubu district.

The culture of collusion has long taken deep root in the
construction industry. There were many chances for the FTC to bring
criminal charges against leading general contractors, but according
to a senior FTC official, "It was a deep desire that it cannot
easily fulfill."

In a bid-rigging case in Saitama in 1991, it was found afterward
that the construction minister at that time had applied pressure to
the FTC so as not to bring charges against the companies involved.

However, the Antimonopoly Law was amended In January last year to
give the FTC enforcement power to carry out investigations and to
empower the district public prosecutors offices across the nation to
indict companies on charges of collusion.

The FTC applied to the Ministry of Land, Infrastructure and
Transport the law to prevent collusive bidding initiated by
public-sector officials on March 8, the first application of the law
to a government agency. Prosecutors and the police have recently
exposed a series of bid-rigging scandals involving governors. A
senior prosecutor commented: "Now that importance has been placed on
post-sanction measures, instead of ex-ante regulations, we will
never overlook bid-rigging practices that affect fair competition.
We will prosecute all violations."

According to estimates by the liaison conference of citizens'
ombudsmen, if prefectural governments had introduced an open bidding
system to prevent collusive arrangements to rig bids, more than 350
billion yen in tax money would have been saved in FY 2005. Toin
University of Hokohama Postgraduate Law Faculty Professor Mitsuru
Suzuki, a former FTC examiner, said, "The people are now aware that
bid-rigging is a crime that wastes tax money and is not a 'necessary
evil'." As it stands, ending bid-rigging practices by exposing such
illegalities among general contractors is the strong desire of the
taxpaying public.

Investigated general contractors will inevitably have to face harsh
sanctions, such as a punishment, a surcharge, and demand for
compensation for default by the local governments that placed the
orders. In addition, managers might become embroiled in
shareholders' suits and also could come under the application of the
so-called "three-punishment rule" in Section 2, Article 95 of the
Antimonopoly Law.

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Under this rule, in a bid-rigging case, offenders, the company, as
well as executives, even if they were not directly involved in the
case can be punished with a fine if they are found to have known
about such illegal acts but took no corrective measures. This rule,
though, has not been previously applied.

With scandals involving companies exposed one after the other, such
as the Fujiya foods scandal that involved use of expired ingredients
to produce cakes, such companies' social responsibility is being
pursued more severely than in any past cases. The Nagoya District
Public Prosecutors Office already questioned the vice presidents of
several leading general contractors about the alleged collusive
arrangements for the municipal subway construction project.

Under "the three-punishment rule," the management assumes an
important role in preventing companies' crimes. The increased
efforts by the FTC and prosecutors to expose bid-rigging practices
are to reflect the people's desire. If general contractors remain
unaware of this, they will never be able to seize a chance to regain
public trust.

SCHIEFFER