DAILY SUMMARY OF JAPANESE PRESS 08/29/08

UNCLAS SECTION 01 OF 09 TOKYO 002378 SIPDIS DEPT FOR E, P, EB, EAP/J, EAP/P, EAP/PD, PA; WHITE HOUSE/NSC/NEC; JUSTICE FOR STU CHEMTOB IN ANTI-TRUST DIVISION; TREASURY/OASIA/IMI/JAPAN; DEPT PASS USTR/PUBLIC AFFAIRS OFFICE; SECDEF FOR JCS-J-5/JAPAN, DASD/ISA/EAPR/JAPAN; DEPT PASS ELECTRONICALLY TO USDA FAS/ITP FOR SCHROETER; PACOM HONOLULU FOR PUBLIC DIPLOMACY ADVISOR; CINCPAC FLT/PA/ COMNAVFORJAPAN/PA. E.O. 12958: N/A TAGS: OIIP KMDR KPAO PGOV PINR ECON ELAB JA SUBJECT: DAILY SUMMARY OF JAPANESE PRESS 08/29/08 INDEX: (1) DPJ President Ozawa busy with preparations for Lower House election (Asahi) (2) Prologue of political realignment (Part 1): Secession of DPJ members to deal blow to Ozawa's strategy of taking over political helm (Yomiuri) (3) LDP National Vision Project Headquarters: Former Secretary General Nakagawa steps up his offensive, playing up his determination to continue reform (Mainichi) (4) High hurdles lie ahead for plan to establish consumer agency (Asahi) (5) Cabinet Office makes budget request totaling 300.8 billion yen, up 18 PERCENT , for development of Okinawa (Mainichi) (6) U.S. government documents dated 1971 specify Japan-U.S. agreement not allowing Japan to monitor air within 50 meters of visiting nuclear-powered submarine (Okinawa Times) (7) Environment ministry's proposal for integrated market for trading for carbon emissions credits obtained in various ways, including assistance to developing countries, use of biofuels (Mainichi) (8) Prime Minister's schedule, August 28 (Nikkei) ARTICLES: (1) DPJ President Ozawa busy with preparations for Lower House election ASAHI (Page 4) (Slightly abridged) August 28, 2008 It has now become certain that Democratic Party of Japan (DPJ) President Ichiro Ozawa will be reelected for his third term uncontested. Ozawa is now busy with preparations for the next House of Representatives election. He plans to start in early September the first selection of the party's candidates to run in the Lower House election. He has no intention to hesitate to replace candidates who are unlikely to win the race. He will focus on shaking up the New Komeito, which is key to the dissolution of the Lower House, as well as on cooperating with non-Liberal Democratic Party forces. Ozawa stressed in a rally hosted by Rengo (Japan Trade Union Confederation) on the night of Aug. 26 in Tokyo: "The DPJ gives top priority to the daily lives of people and to 
putting an end to the wasteful use of tax money. However, the LDP-New Komeito coalition attaches importance to the protection of bureaucrats and politicians and favors tax hikes. So, political change is the only way for Rengo to realize its goals." Ozawa then sought Rengo's support for political change. Ozawa ordered the party to conduct a survey on Aug. 24 and Aug. 31 to assess the situations of nationwide constituencies. Soon after TOKYO 00002378 002 OF 009 Ozawa receives the results of the survey in early September, the DPJ will start screening unofficial candidates. The DPJ has already informally picked 245 candidates. Ozawa has set the goal of winning at least 150 of the 300 district seats. He plans to use funds mainly for contests in the single-seat constituencies. He has ostensibly said that he never said that he would replace candidates, but he has told his aides that the number of the candidates should be narrowed down to 200. Ozawa will resume his nationwide stumping tour in late September. He said: "The party will provide physical and financial support to its candidates." A person close to Ozawa explains what he meant: "It means that he will not make any campaign speeches for candidates who have no chance to win." DPJ Vice President Hajime Ishi was surprised at Ozawa's remark: "I don't mind running in Tetsuzo Fuyushiba's Hyogo No. 8 constituency." Ozawa made this remark on Aug. 13, when Ishii pointed out that the New Komeito had gained power in the ruling camp. Ishii then responded, noting: "It would be better for you to run for the election in Tokyo." He said this because Ozawa had implied his candidacy for the Tokyo No. 12 constituency. Ozawa wants to threaten the New Komeito by the rumor that he may run in the district of a senior New Komeito member in order to have the party reconsider its election cooperation with the LDP. Ozawa appears to be aiming at shaking up the New Komeito, which is worried about the next Lower House election. Ozawa's effort to forge election cooperation with non-LDP forces is to come down the homestretch. Ozawa has already obtained through Upper House member Yoshihiro Kawakami a list of 12 independent candidates who may follow Takeo Hiranuma if he forms a new party. Most of the 12 are the so-called postal rebels who lost Lower House seats. Ozawa is considering the possibility of election cooperation with about four of the 12. Like Hiranuma, Kawakami left the LDP after voting against the government's postal privatization program at the Diet. Kawakami then won his current Upper House seat backed by the DPJ in last summer's election. Kawakami met on Aug. 22 with former Kochi Prefecture Gov. Daijiro Hashimoto, who has decided to run in a national election. Ozawa has launched full-scale election cooperation with other opposition parties: the Social Democratic Party, the People's New Party, and the New Party Japan. He is putting in his final efforts in building a framework that will result in the ruling camp losing its majority in the Lower House. Asked by reporters about election cooperation, Ozawa explained: "We agree on the stance that the LDP-New Komeito coalition government is not working for the good of the public." He then stressed: "It means that we will bring about a political change by cooperating with any party that takes such a political stand." (2) Prologue of political realignment (Part 1): Secession of DPJ members to deal blow to Ozawa's strategy of taking over political helm YOMIURI (Page 1) (Full) August 29, 2008 TOKYO 00002378 003 OF 009 Receiving the information that three House of Councillors members from the Democratic Party of Japan (DPJ) -- Hideo Watanabe, Yasuhiro Oe and Yumiko Himei -- will leave the DPJ to form a new party, Economy, Trade and Industry Minister Toshihiro Nikai, a member of the ruling Liberal Democratic Party (LDP),now visiting Singapore, was feeling good ahead of an economic ministerial with his ASEAN counterparts. Nikai, ostensibly assuming a poker face, said: "It's irrelevant to me. They may have made that decision on their own." However, he told his aides: "This is the first wave. The second one has been prepared." Watanabe and other lawmakers left the DPJ to create a new party at the time when President Ichiro Ozawa was certain to be reelected for his third term without going through an election. This is part of the LDP's "maneuvering" since it was defeated in last year's Upper House election. The LDP's strategy is that if the party wins the Lower House in a close race, it will immediately work on the DPJ's Upper House members to get them to bolt their party, and that the party to be created by Watanabe and other members would become a party to attract lawmakers who leave the DPJ. Nikai has fulfilled the initiative in carrying out this strategy. Nikai was a former aide to Ozawa. He and Ozawa formed the Conservative Party (Hoshuto) in ¶2000. The five members are not enough to put an end to the politically divided Diet situation. If the LDP succeeds again in having more DPJ Upper House members withdraw from the party, it would gain advantage over the largest opposition party in the Lower House election. Therefore, attention is now on whether there will be a second wave. Ozawa yesterday formally informed Kan and other executives of his intention to run in the presidential election. The Upper House majority of the Upper House seats are 122. The number of the DPJ Upper House members will decrease from 120 to 117. Unless the DPJ asks for cooperation from the Japanese Communist Party and the SDP, it won't be able to secure a majority of the Upper House. The People's New Party, with which the DPJ forms a parliamentary group, necessarily takes a concerted action with the DPJ. The JCP has seven Upper House members; the SDP, five; and the PNP, four. There will be no change in the political situation that the JPC and SDJ hold a casting vote, even if the DPJ wins in the Lower House race, launching an "Ozawa administration." Whether the Japanese political situation will become increasingly chaotic or political realignment will start. Watanabe described the creation of a new party by only five members: "It is a question how a small move we took will spread." (3) LDP National Vision Project Headquarters: Former Secretary General Nakagawa steps up his offensive, playing up his determination to continue reform MAINICHI (Page 5) (Full) August 29, 2008 TOKYO 00002378 004 OF 009 The National Vision Project Headquarters (NVPH) of the Liberal Democratic Party (LDP),chaired by Prime Minister Yasuo Fukuda, held a meeting on August 28 at the party headquarters for the first time since the shuffle of the cabinet and the leadership of the LDP on August 1. Former Secretary General Hidenao Nakagawa, who is acting chairman, the top post in essence, has selected as vice chairmen those who advocate continuing the reform drive and once served as cabinet ministers, such as former State Minister for Administrative Reform Yoshimi Watanabe and former Chief Cabinet Secretary Yasuhisa Shiozaki. In the shuffle of the LDP leadership, lawmakers who want to take a second look at Prime Minister Koizumi's reform policy were appointed to key posts, such as Taro Aso becoming LDP secretary general. Nakagawa, however, was snubbed. Nakagawa intends to use the NVPH as a stronghold for going on offensive. Nakagawa in a speech indicated a policy of mapping out a mid- to long-term vision that reflects the party's manifesto for the next Lower House election. He said: "The world is making headway. I want to map out a vision that aims at implementing reform, seizing the current situation as a good opportunity." The proposed vision will likely include such policies as economic, fiscal and political reforms. The meeting was joined by about 70 persons. Watanabe underscored, "We must send a message conveying our resolve to continue the reform drive." In accordance with the established practice, Nakagawa had to appoint some members of the party leadership to the NVPH's executive posts, such as Aso as acting chairman, and Policy Research Council Chairman Kosuke Hori, a postal rebel who was reinstated to the LDP, as vice chairman. However, he has increased the number of vice chairmen from 6 to 27 and filled the increased seats with reformists. He appointed former Secretary General Tsutomu Takebe, who is linked to former Prime Minister Junichiro Koizumi, former Defense Minister Yuriko Koike and former special advisor to the prime minister Tatsuya Ito, who is close to Nakagawa, to the post. Nakagawa plans to draft a mid- to long-term vision possibly by November. Koike took office as chair of the newly established a mid- to long-term vision compilation committee. He also appointed 52 so-called Koizumi children who were elected as Lower House member as vice chairman of the panel. There are 130 vice chairmen in all. Nakagawa takes the view that it would be impossible to obtain support from voters without any party affiliation in urban areas in the next Lower House election, unless the party contests the next election under the banner of reform. However, his stance is likely to cause discord with the leadership, which is negative toward the reform policy. (4) High hurdles lie ahead for plan to establish consumer agency ASAHI (Page 4) (Full) August 29, 2008 A plan to create a consumer agency, one of Prime Minister Fukuda's key agenda items, has reached a crucial juncture. The government is ready to submit to the upcoming extraordinary Diet session a related bill next fiscal year in accordance with its pledge, but the Democratic Party of Japan (DPJ) is poised to rattle the government TOKYO 00002378 005 OF 009 by preparing a counterproposal. If talks on revising the government's bill are broken off, the government will have no choice but to take a revote in the House of Representatives. But the New Komeito is opposed to using revote. In negotiations on the consumer agency bill, like in those on the bill extending the New Antiterrorism Special Measures Law, the government may face the risk of losing political strength. Coordination with DPJ difficult Speaking before reporters at his official residence yesterday, Prime Minister Fukuda emphasized the need to find common ground with the DPJ, saying: "We will form an organization that is helpful for consumers and the people. I believe that the opposition camp also has a similar idea to ours. We would like to cooperate on what both camps can do." He thinks it would be possible to reach an agreement with the DPJ, because the main opposition is also calling for strengthening governance to benefit consumers in stressing the need to give priority to the people's daily lives. But the government bill and the DPJ counterproposal are fundamentally different in terms of "philosophy" regarding systemic designing. The government bill proposes establishing the consumer agency in the Cabinet Office and suggests that the agency give advice to the competent authorities regarding punishment on vicious companies and other matters. It also proposes that the new agency should be responsible for the areas that have no competent authorities. In contrast, the DPJ counterproposal proposes installing officers responsible for protecting consumer rights outside the Cabinet Office, based on the view that if the agency is set up in the Cabinet Office, its discretion might be used. Under the DPJ bill, such officers would be appointed by the government from the private sector and would recommend government agencies and local governments concerned on how to respond to complaints from consumers. The two camps have also different views about what liaison centers for consumers should be. Under the government's bill, local governments' consumer affairs centers would be networked and the government would offer financial support. The DPJ plan proposes integrating the consumer affairs centers into national organizations and giving the status of part-time public servant to advisors. State Minister for Consumer Administration Noda emphasized that she cannot budge an inch on the plan to establish the consumer agency in the Cabinet Office. Regarding the status of local advisors, as well, Noda indicated a negative view about the DPJ proposal. She told reporters after returning from an on-site inspection of the Shiga Prefecture Consumer Affairs Center: "If advisors are given the status of public servant, disagreements might break out between advisors and local public service employees. Although the government will offer as much assistance as possible, it will be undesirable if the government have the whip hand over the consumer affairs centers." DPJ's Research Council on Human Rights and Consumers Vice Chairman TOKYO 00002378 006 OF 009 Yukio Edano stressed: "It will be more effective to carry out surveillance, mediation, and conciliation from outside." Council Chairman Yoshito Sengoku also criticized the government's bill, remarking: "What about the right, status, and post of an advisor? The Fukuda concept does not refer to distributing money, authority, and personnel there." New Komeito cautious about revote tactic In discussing consumer administration in the upcoming extraordinary Diet session, the DPJ intends to first take up the fact that the Japanese government did not go public with information about food poisoning cases in China involving pesticide-tainted dumplings. The main opposition will pursue the prime minister's responsibility, claiming: "The Fukuda cabinet's stance is far from giving consideration to consumers." The party then intends to watch the government's response and public opinion and then decide whether it should reject the government bill or urge the government to significantly revise its bill in line with the DPJ counterproposal. If the DPJ refuses to respond to their call for talks on amending the government bill or if the talks end in failure, there will be no choice but for the government and the ruling coalition to take a Lower House revote to force through the government bill. A senior government officer insisted: "The consumer agency must be urgently established. We should not be hesitant about resorting to the revote tactic." But the New Komeito remains negative about the revote tactic in dealing with not only the antiterrorism bill but also the consumer agency bill. The junior coalition partner, which aims at dissolving the Lower House late this year or early next year, fears that the voters would see such an approach as authoritarian management of the Diet. A senior New Komeito member flatly said: "We would like very much to respond to the prime minister's feeling, but we do not think that the bill is worth enough to be forced through." If the government's priority agenda is fatally dashed, the prime minister will unavoidably lose his grip on the party, causing a political gridlock. An aide to the prime minister was overheard even saying that if the DPJ presented a counterproposal, the government would totally accept it. (5) Cabinet Office makes budget request totaling 300.8 billion yen, up 18 PERCENT , for development of Okinawa MAINICHI (Page 5) (Full) August 28, 2008 The Cabinet Office on August 27 compiled Okinawa-related budget requests for fiscal 2009. It has request a total of 10 billion yen as usual for measures to develop northern Okinawa to finance the relocation of the U.S. Marine Corps' Futenma Air Station in Ginowan City. For the establishment of the Okinawa Institute of Science and Technology in fiscal 2012, it requested 14.87 billion yen. The total amount comes to 308.06 billion yen, up 17.9 PERCENT , compared with the original request for fiscal 2008. As measures to develop northern Okinawa, 10 billion yen have been earmarked for 12 municipalities in the region, including Nago City, starting in fiscal 2000. In the past, the implementation of the fiscal 2007 budget was put on hold on the basis that talks by TOKYO 00002378 007 OF 009 affected municipalities on the relocation of Futenma functions were not going smoothly. As a tax code-related measure, the Cabinet Office will seek the continuance of a special measure to cut the gas tax by 7 yen per liter after the reallocation of special road funds for other uses, as well. (6) U.S. government documents dated 1971 specify Japan-U.S. agreement not allowing Japan to monitor air within 50 meters of visiting nuclear-powered submarine OKINAWA TIMES (Page 2) (Full) August 29, 2008 It was learned yesterday that the U.S. government has documents showing that the governments of Japan and the United States had agreed in late 1971 that Japan would remain over 50 meters away when monitoring radiation in the air of U.S. nuclear-powered vessels making port calls in Japan. An official of the Ministry of Education, Culture, Sports, Science and Technology (MEXT) that monitors radiation levels around U.S. nuclear-powered vessels has denied the existence of such an agreement, saying: "Monitoring has been conducted within a 50-meter perimeter of U.S. vessels. I have never heard of such an agreement." MEXT does not know existence of documents Several such official documents exist. Shoji Niihara, a researcher of the history of Japan-U.S. relations, found them at the U.S. National Archives and Records Administration in 2007. The content of the Japan-U.S. agreement is mentioned in documents dated November 10 and December 10, 1971 that are kept as secret oral records strictly for internal use only. They note that Japan is not to measure air quality within 50 meters of a U.S. Navy vessel, that Japan is not to activate even a radiation measuring device aboard a boat within 50 meters of a U.S. vessel, and that the Japanese government has the right to monitor air within 50 meters of a U.S. nuclear-powered vessel in order to confirm that it is not at risk of causing radioactive contamination. The documents are marked "secret" in English and "Strictly secret for an indefinite period of time" in Japanese. According to a document written in 1971 by (Stephen P. Dawkins),a Department of State East Asian and Pacific Affairs Bureau officer in charge of Japanese affairs, Japan began seeking information on radiation of U.S. vessels after an abnormally high level of radiation was detected near a U.S. vessel in Yokosuka Port in 1969. The U.S. side asked Japan not to measure air within a 50-meter perimeter, saying that because Japan's measuring device is so sensitive that measurement near U.S. vessels would end up revealing classified data on the nuclear propulsion plant. The document notes that the oral agreement was reached between working-level officials of Japan and the United States on August 28, 1971. Masato Kino, chief of the MEXT Disaster Prevention and Environment Office said: "I have never heard that such an agreement exists or that provisions were altered later on. There has been no order to that effect to the Japan Coast Guard that conducts boat-based monitoring." He also indicated that his ministry has received a TOKYO 00002378 008 OF 009 reply from the Foreign Ministry noting that it does not know the existence of the documents. Niihara said: "The documents were produced back in 1971. I don't know the current situation. Questions remain about the government's responses to the latest leak of radiation from a nuclear-powered submarine and to the fire aboard a nuclear-powered aircraft carrier. The government should offer a convincing explanation and disclose information." (7) Environment ministry's proposal for integrated market for trading for carbon emissions credits obtained in various ways, including assistance to developing countries, use of biofuels MAINICHI (Page 2) (Full) August 29, 2008 The outline of the Environment Ministry-sponsored integrated domestic market for trading for greenhouse gas emissions credits, slated to be implemented on a trial basis in October, was revealed on August 28. A major feature of the package is a focus on enabling companies to trade in the integrated market greenhouse gas emissions credits they have obtained through the use of recyclable energies, such as biofuels, or through taking part in various carbon emissions reduction projects under the Kyoto Protocol, as well as under a domestic emissions-trading system, under which emissions quotas are set for leading companies. The aim is to encourage companies to take part in emissions-rights trading, using carbon emissions credits obtained through various systems. Prime Minister Fukuda in June announce a plan to open the integrated domestic market on a trial basis According to the Environment Ministry, the following three kinds of carbon emissions credits can be traded on the integrated market: (1) emissions credits obtained under the domestic carbon emissions trading system; (2) emissions credits obtained based on the Kyoto Protocol, such as by taking on clean development mechanism (CDM) projects designed to help developing countries reduce carbon emissions and (3) highly trustworthy domestic carbon emissions credits obtained through the use of photovoltaic generation, biofuels and recyclable energies, such as, forestry biomass, and the carbon off-set system and emissions reduction projects carried out by small and medium-size businesses. In all those three cases, if carbon emissions were cut more than the targeted level, the balance between the targeted amount and the actual amount of emissions will be granted as emissions credits. Of those three trading types, target carbon emissions quotas will be set for companies participating under the domestic emissions trading system. Companies that have attained their goal through such efforts as energy saving, will be allowed to sell surplus quotas for greenhouse gas emissions to companies that have failed to do so. In achieving their goals, companies can use emissions credits obtained under the Kyoto Protocol and highly trustworthy domestic emissions credits. The integrated market will broker such trading. According to the Environment Ministry's proposal, related government ministries and agencies will establish a target approval committee and a system monitoring committee to ensure smooth operations of various systems. A third-party verification organization will verify TOKYO 00002378 009 OF 009 individual transactions. The Environment Ministry hopes to see as many companies as possible join the system. (8) Prime Minister's schedule, August 28 NIKKEI (Page 2) (Full) August 29, 2008 09:27 Met Nisshin Food President Ando at the Kantei. Followed by Special Advisor Ito. 12:19 Met Chief Cabinet Secretary Machimura. 14:26 Met Yuzaburo Mogi, Japanese side's chairman of the Japan-South Korea Forum, South Korean side's Chairman Kong, and others. 15:05 Met Foreign Ministry Global Issues Bureau Director General. Later met Cabinet Office Vice Minister Yamamoto, and Decoration Bureau Director General Fukushima. Yamamoto stayed behind. 16:15 Met Japan Finance Cooperation for Small and Medium Enterprise President Yasui. Followed by Consul General in Manaus Shibazaki. 17:10 Met Foreign Ministry Vice Minister Yabunaka, Deputy Foreign Minister Sasae, and Asian and Oceanian Affairs Bureau Director 19:00 Met at his official residence with incumbent and former defense minister Hayashi and Ishiba, members of the Defense Ministry Reform Conference, including National Defense Academy President Makoto Iokibe, Vice Defense Minister Masuda, and others. Iokibe stayed behind. ZUMWALT