FUKUDA RESIGNS, WITH CONSEQUENCES FOR OEF, DIET,

C O N F I D E N T I A L SECTION 01 OF 02 TOKYO 002400

SIPDIS

E.O. 12958: DECL: 09/01/2018
TAGS: PGOV ECON JA
SUBJECT: FUKUDA RESIGNS, WITH CONSEQUENCES FOR OEF, DIET,
ELECTION

Classified By: CDA James P. Zumwalt, reasons 1.4(b),(d).


1. (C) Summary. Prime Minister Fukuda surprised the nation
on September 1 by unexpectedly announcing his intention to
resign in a hastily-arranged, late-evening news conference.
Ruling party executives have moved quickly to set in motion
plans for a new LDP presidential election, likely in the
September 21-22 timeframe and around the time the opposition
DPJ is slated to announce its own new leadership slate at a
party convention. The LDP will delay the opening of the fall
Diet session beyond its previously scheduled September 12
start date to accommodate its election. The new LDP
President is expected to be elected Prime Minister at the
opening of that session, given the LDP's numerical
superiority in the Lower House. At this point, the press has
speculated that possible candidates in the LDP election are
party Secretary General Taro Aso and former Defense Minister
Yuriko Koike, among others. Fukuda's resignation increases
the likelihood of a general election before the end of this
year, or early next year, and does not bode well for passing
legislation to extend Japan's refueling efforts in support of
Operation Enduring Freedom, Embassy contacts say. End
Summary.


2. (C) Prime Minister Fukuda, in a move that newspaper
accounts say surprised even his own wife, announced his
resignation in a live news conference at 9:30 p.m. on
September 1. In his remarks to the press, Fukuda cited his
inability to overcome the impasse in the Diet as his primary
motive for resigning, and expressed hope that by resigning
now, he could "avoid creating a political vacuum." Press
reports on September 2 also cited friction with junior
coalition partner Komeito over Diet scheduling and key
legislative initiatives, as well as an office expense scandal
involving Agriculture Minister Seiichi Ota, as key factors
that increased the pressure on Fukuda to resign at this time.
Leading opposition politicians quickly labeled Fukuda
"irresponsible" for "abandoning" his duties, but ruling party
officials have been quick to point out that it was opposition
obstructionism that had prevented Fukuda from achieving his
legislative objectives.


3. (C) Embassy contacts have been fairly unanimous over the
past month in predicting a Lower House election later in the
year or early next year. If anything, Fukuda's announcement
makes this possible dissolution timetable even more likely,
particularly since his successor will be the third prime
minister to take office without an intervening general
election. (Note: The last Lower House election was held in
September 2005. The term of the members elected in 2005 will
expire in September 2009, unless the House is dissolved
first.) This combination of a delayed start to the fall Diet
session and an early finish will greatly diminish the
prospects during this session for passing the legislation
needed to extend Japan's refueling activities in the Indian
Ocean in support of Operation Enduring Freedom, as well as
other Fukuda initiatives, according to Embassy contacts. As
one pessimistic contact bluntly put it, "the OEF refueling
legislation is already in the trash can."


4. (C) Already, news reports are noting that the impact of
Fukuda's decision could extend to everything from a
postponement of the Japan-China-ROK trilateral summit
tentatively scheduled for September 21, to a backing away
from commitments in Iraq and Afghanistan, to a delay in
progress with North Korea on the abductions issue. Multiple
press reports on September 2 quoted former U.S. officials
expressing "shock" over Fukuda's sudden announcement and
suggested a possible deleterious impact on the bilateral
alliance. The aftershocks could certainly ripple through the
implementation of the Defense Policy Review Initiative (DPRI)
and other bilateral security cooperative efforts. Of
immediate concern is the funding for the relocation of U.S.
Marines to Guam and the upgrading of CH-47 helicopters to be
used for international peace cooperation activities, both of
which are included in the Japanese government's supplemental

TOKYO 00002400 002 OF 002


budget request to be submitted at the beginning of the fall
Diet session.


5. (C) Ruling Liberal Democratic Party (LDP) executives
gathered early on September 2 to discuss the procedures for
electing a successor. They are reportedly leaning toward a
vote on September 21 or September 22, hoping to draw
attention away from an opposition Democratic Party of Japan
(DPJ) convention scheduled for that time. One news account
quoted Fukuda as saying that he had made up his mind to
resign on August 29, but had chosen to wait until September 1
to announce the decision in order to overshadow DPJ leader
Ichiro Ozawa's official announcement that he will stand for
re-election as DPJ President. It is also noteworthy that the
registration deadline for LDP candidates -- 12 days prior to
an election -- will coincide roughly with the registration
cut-off for the DPJ leadership election. Ozawa is widely
expected to run unopposed, with some Embassy DPJ contacts
fearing that an uncontested election could damage party
efforts to win support in the next general election.


6. (C) LDP rules, which can be re-written on an ad hoc basis
with the approval of its members, require presidential
candidates to secure the support of 20 party members. Under
the most recent version of the rules, a candidate must
receive a majority of the votes, with one vote granted to
each of the 387 LDP Diet members and another 300 votes
granted to the 47 LDP prefectural chapters, some of which are
allocated on a proportional basis and others decided on by
local party executives. The number of votes accorded to
local LDP members could be significant. At this point, the
press has speculated that possible candidates in the LDP
presidential election are party Secretary General Taro Aso
and former Defense Minister Yuriko Koike, among others.


7. (C) Fukuda took office on September 15, 2007, shortly
after the surprise resignation of Prime Minster Shinzo Abe.
While the exact timing of Fukuda's resignation appears to
have caught even party insiders by surprise, Embassy contacts
concede that his move was not entirely unexpected. After
keeping Abe's last reshuffled Cabinet in place for nearly
eight months, Fukuda finally succumbed to calls to appoint a
new lineup on August 1, hoping to improve his popular appeal
with voters. The personnel changes did little to raise his
cabinet support rate, however, which had fallen to just under
20 percent in some polls in May before recovering slowly over
the past several months to the 30 percent range. His focus
on "people oriented" policies, such as creation of a consumer
affairs agency and an economic stimulus package, also did
little to boost public support, with most polls indicating
that he has consistently failed to convey his "message" to
the public. At the same time, he has received little credit
domestically for his diplomatic efforts to improve relations
with Asian neighbors or his successful hosting of the G-8.
ZUMWALT