DAILY SUMMARY OF JAPANESE PRESS 09/10/08

UNCLAS SECTION 01 OF 09 TOKYO 002495 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 09/10/08 INDEX: (1) Poll on post-Fukuda premiership (Mainichi) (2) Political maneuvering starting over Lower House election to choose new administration; LDP hopes for policy debate, DPJ wants to eliminate bureaucratic power (Nikkei) (3) I Corps will not move to Zama: U.S. commander (Yomiuri) (4) Editorial: Seven years since 9/11 -- Let's create new common ground (Asahi) (5) METI's new economic strategy calls for increasing resilience to soaring resource prices (Nikkei) (6) TOP HEADLINES (7) EDITORIALS (8) Prime Minister's schedule, September 9 ARTICLES: (1) Poll on post-Fukuda premiership MAINICHI (Page 5) (Full) September 10, 2008 Questions & Answers (T = total; P = previous; M = male; F = female) Q: What do you think is needed for prime minister? T P M F Experience 3 3 4 Determination 33 35 31 International sensibility 3 3 3 National popularity 2 2 2 Policy implementation 36 35 37 Foresight 9 11 8 Coordinating ability 3 3 3 Personality 4 3 5 A sense of morality 2 2 3 Youthfulness 1 1 1 Q: Who do you think is appropriate for prime minister now? (Free choice) T P M F Taro Aso 23 24 23 Junichiro Koizumi 7 6 7 Ichiro Ozawa 7 9 4 Yuriko Koike 4 3 5 Nobuteru Ishihara 4 4 4 Kaoru Yosano 1 1 1 Shigeru Ishiba 1 1 1 Other ruling party lawmakers 3 3 3 Other opposition party lawmakers 2 3 2 Other than lawmakers 3 4 2 None + no answer (N/A) 46 42 49 TOKYO 00002495 002 OF 009 Q: Do you appreciate Prime Minister Fukuda and his cabinet over the past year? T P M F Yes 21 18 23 No 73 76 71 Q: Do you appreciate Democratic Party of Japan (Minshuto) President Ichiro Ozawa? T P M F Yes 22 28 17 No 72 67 77 Q: Which form of government do you think is desirable? T P M F The current coalition government of the Liberal Democratic Party and the New Komeito 14 12 16 A grand coalition of the Liberal Democratic Party and the Democratic Party of Japan 37 33 41 The LDP's single-party government 10 13 8 A DPJ-led coalition government 17 21 14 The DPJ's single-party government 6 8 4 A non-LDP, non-DPJ coalition government 6 5 6 (Note) Figures shown in percentage, rounded off. Polling methodology: The survey was conducted across the nation on Sept. 5-7. For the survey, a total of 4,602 persons were chosen from among men and women, aged 20 and over (as of Sept. 30),at 300 locations on a stratified two-stage random sampling basis. Answers were obtained from 2,563 persons (56 PERCENT ). (2) Political maneuvering starting over Lower House election to choose new administration; LDP hopes for policy debate, DPJ wants to eliminate bureaucratic power NIKKEI (Page 1) (Full) September 9, 2009 Lower House dissolution in October eyed Democratic Party of Japan (DPJ) President Ichiro Ozawa yesterday was reelected to a third term unopposed. He immediately sent out a signal to take over the reins of government from the ruling coalition. In the ruling Liberal Democratic Party (LDP),meanwhile, policy debate is now moving into full swing among candidates for the party's presidential election. Both the LDP and DPJ are eyeing a dissolution of the House of Representatives in October and a general election in November. How will the ruling and opposition parties put an end to the politically divided Diet? Ozawa's press conference on Sept. 8 lasted for about 40 minutes, twice the length of his regular press meeting. In it, Ozawa stressed the need for shifting the center of gravity of the government from bureaucrats to politicians. He said: "No matter who assumes its presidency, the LDP does what it is told to do by the bureaucrats." He tried to say that smoldering frustration among the public over pensions, medical services and jobs have resulted from the "nature" of the LDP and the bureaucracy at Kasumigaseki. TOKYO 00002495 003 OF 009 Ozawa, who left the LDP 15 years ago, underscored that he would risk his political life to take over the reins of government. He announced on Sept. 8 a set of basic policies, in which he expressed his determination to create a government system, which would be controlled by politicians, by increasing the number of senior vice ministers and parliamentary secretaries. Regarding the prospect for the next Lower House election, Ozawa said: "The situation is tough." In consideration of such a situation, the package of basic policies includes measures that may be criticized for pork-barrel largesse. The measures include: creating a child-rearing support system under which the government would pay 26,000 yen per child per month; and abolishing provisional gasoline-related taxes; and income support for individual fishermen. It is believed that the package needs fiscal resources worth over 18 trillion yen. Ozawa's argument is that cozy relations between the LDP and Kasumigaseki have created the wasteful use of tax revenues. Ozawa, therefore, believes that fiscal resources would be secured by political change. He has said that he will explain how to secure fiscal resources soon or later. However, it is uncertain when he will present a roadmap, including the date for implementing the measures. If the package is a copy of the party's manifesto for last July's House of Councillors election, which estimated the necessary amount of fiscal resources at 15.3 trillion yen, it will lack persuasiveness. How about the policies of the LDP presidential candidates? Secretary General Taro Aso, the front-runner, takes a clear stance. He said in a meeting of freshman lawmakers from the two Diet chambers: "It is no good to implement fiscal reconstruction based on fundamentalism." In the background, Aso is concerned about the general election. Since the LDP was defeated by the DPJ in last year's the Upper House election, LDP prefectural chapters have called on party headquarters to carry out warm-hearted politics for provisional areas, which have been impoverished due to structural reforms. Aso has repeatedly visited rural areas since he stepped down as secretary general in the Abe administration. So, it may be only natural for Aso to advocate the need for aggressive fiscal spending. On Sept. 8 Economic and Fiscal Policy Minister Kaoru Yosano, who places priority on fiscal reconstruction, and former Defense Minister Yuriko Koike, who attaches importance to economic growth, formally announced their candidacies for the presidential race. They are expected to hold heated policy debate. The question is how much of their policies will be reflected in the party's manifesto for the Lower House election. Some lawmakers have sought to constrain Yosano, with one saying: "If we say we will hike the consumption tax, we won't be able to win the election." Aso and New Komeito Secretary General Kazuo Kitagawa held a meeting on the night of Sept. 8 at a Tokyo hotel. The meeting was also attended by LDP Election Strategy Council Chairman Makoto Koga and New Komeito Electoral Policy Committee Chairman Yoshihisa Inoue. No matter who becomes LDP president, it seems unavoidable that the New Komeito's demand for a fixed tax reduction worth several trillion yen will be included in the ruling coalition's platform. The will of voters that will be shown in the next Lower House election will make clear which party becomes the axis of government. TOKYO 00002495 004 OF 009 Voters need elaborative manifestos to judge for which party they should vote. How the debate will turn out cannot be predicted. (3) I Corps will not move to Zama: U.S. commander YOMIURI (Page 31) (Full) September 10, 2008 U.S. Army Japan (USARJ) Commander Francis Wiercinski, meeting the press yesterday, said the U.S. Army 1st Corps' headquarters, currently located in the U.S. mainland state of Washington, and its forward-deployed command established at Camp Zama, a U.S. Army base straddling the cities of Sagamihara and Zama in Kanagawa Prefecture, are "quite different organizations." The commander indicated that the 1st Corps will not relocate its headquarters to Camp Zama. A reporter asked, "Local residents are worried that the First Corps' headquarters may come to Camp Zama." Commander Wiercinski admitted that the 1st Corps sent troops, but he denied its involvement. He added, "The forward-deployed command is an on-site organization prepared for emergencies in the Far East." With this, he stressed the difference between the two organizations. The forward-deployed command was set up at Camp Zama last December as part of the U.S. military's realignment intended to enhance its readiness against terrorism and other eventualities. Local residents were concerned about the forward-deployed command's establishment. "In the future," one local resident said, "it may be integrated with the First Corps and the base's functions may be reinforced." The commander also referred to a plan on building a command exercise facility (simulation center) on the premises of the U.S. Army's Sagami Depot in the city of Sagamihara. "We want to have it built as early as possible," he said. The facility's design is now in the finishing touches. Construction work will start before the summer of 2009 and is planned to be completed in the fall of 2010, the commander said. (4) Editorial: Seven years since 9/11 -- Let's create new common ground ASAHI (Page 3) (Full) September 10, 2008 In the wake of the 9/11 attacks, many people from around the world expressed support for the determination of the United States to confront terrorism. Sharing the sorrow, shock, and anger with the United States, people in many countries felt compelled to eradicate terrorism. Every country must work hard so as not to allow international terrorist groups to repeat barbarous acts. Such a sense of unity was prevalent. There was clearly an atmosphere to consider steps to combat terrorism based on a common ground. Solidarity weakening Seven years will have passed tomorrow since then. Antiterrorism operations started in Afghanistan and Iraq under the leadership of the United States, and the subsequent military control, still continue. There has been no major terrorist attack on TOKYO 00002495 005 OF 009 the United States (since 2001). President George W. Bush boasts that the country's security has been defended because of the war on terror being waged outside the country. But there no longer exists the sense of unity that was shared by many people across the globe. What happened? The bond between the United States and its traditional allies was strained, and such phrases as "old Europe, new Europe" and the "coalition of the willing" were used often. The bond between the United States and its European allies was strained over the Iraq war, and the countries are still out of step with each other in rebuilding Iraq. Although Afghanistan is supposed to be headed for democracy, the security situation in that country is deteriorating because the Taliban has regained influence over the last two to three years. Osama bin Laden has yet to be caught. The United States has asked its allies to send more troops to Afghanistan, but most of them are reluctant to do in view of its price and poor prospects. In Pakistan, President Perves Musharraf, who had been cooperative in the U.S.-led war on terror, has been forced to resign, and the country's political situation is still unstable. Foreign Affairs (July/August issue) carried Secretary of State Condoleezza Rice's essay that read: "Al Qaeda's theory of victory is to hijack the legitimate local and national grievances of Muslim societies and twist them into an ideological narrative of endless struggle against Western, especially U.S., oppression." Although the United States was aware of such theory, it has been at a loss what to do with the anti-American sentiment that has spread in Muslim societies over the last seven years. The Iranian president's pursuit of an uranium enrichment program, instigated by anti-American sentiment, is probably not totally divorced from that. Theory of defeating terrorism Former Russian President Vladimir Putin once said: "We are with the people of the United States." Russia has recently shown a stance of challenging the United States on the strength of its economic might backed by its petro-money. Where has that sense of unity gone? The Bush administration "with-us-or-against-us" theory is to blame. Behind terrorism lies a variety of factors, such as history and ethnicity. U.S. allies have their own circumstances. To begin with, Muslim countries were distrustful of the United States that constantly supported Israel. The Bush administration has lost global trust and influence because it excessively tilted toward war on "American grounds," so to speak. The common ground seems to have eroded as a result. What are the plans of U.S. presidential candidates, Barack Obama and John McCain, to revamp the war on terror? They have unveiled their own strategies. One candidate would withdraw from Iraq and the other would continue the present military operation. The basic question, though, is how to rebuild the common ground. How to create a ground that can be accepted by many Moslem TOKYO 00002495 006 OF 009 countries, Russia and China, not to mention Japan and European nations? Although armed strength is necessary, how military might is used must be reexamined. To eliminate the breeding ground for terrorism, we must extend enhanced support that can help each country demonstrate its own capabilities. Secretary Rice explained "our theory of victory" this way: To offer Muslim peoples a democratic path to advance their interests peacefully -- to develop their talents, to redress injustices, and to live in freedom and dignity. We cannot agree more. We must recreate the ground where the countries around the world can combine efforts for this theory. Japan, too, must explore an accord Japan has constantly struggled to cooperate with the United States. The dispatch of the Self-Defense Force to Iraq under the former Koizumi administration is a prime example. Thanks to that, relations with the Bush administration have been good. But how should Japan be involved in the international effort to eliminate terrorism? Japan has yet to determine its direction. Over the question of continuing the refueling mission in the Indian Ocean, the Liberal Democratic Party asks if Japan alone should be allowed to drop out of the war on terror. The Democratic Party of Japan opposes it, calling the refueling mission unconstitutional. The propriety of the refueling mission must be examined from the viewpoint of the stability of Afghanistan. Are there any other ways for Japan to contribute under its military constraints? The two parties are responsible to build a common ground in Japan to address common international issues. President Bush's tenure of eight years will come to an end shortly. The next U.S. leader will bear enormously heavy responsibility to restore international solidarity. At the same time, how should Japan's next leader take and support it? The season of election to answer that question has rolled in. (5) METI's new economic strategy calls for increasing resilience to soaring resource prices NIKKEI (Page 5) (Full) September 9, 2008 The Ministry of Economy, Trade and Industry (METI) has drafted a new economic growth strategy to increase the Japanese economy's growth potential from the medium- to long-term perspective. The draft stresses the need to increase resilience to soaring oil and other resource prices, as well as to promote exports and investment in emerging countries. The draft incorporates specific measures aimed to expedite energy conservation by lowering taxes on capital investment and other specific measures. The new strategy estimates that the country would realize real annual growth of 2.4 PERCENT in gross national income (GNI) by fiscal 2015. Focus on attracting overseas funds; Regulatory reform insufficient METI Minister Toshihiro Nikai will announce the new strategy today. TOKYO 00002495 007 OF 009 In 2006, the government released the New Economic Growth Strategy, as its first policy guidelines to realize an over 2 PERCENT economic growth in real terms despite the nation's declining and aging population. Given recent soaring oil prices, structural changes in the global economy, as well as global warming, the ministry decided to significantly review the original report. Because Japan has few natural resources, it largely relies on imports. Accordingly, huge income has flown out of Japan due to skyrocketing oil prices. Income outflows to foreign countries in fiscal 2007 registered a record high of about 21 trillion yen. In the nation, deteriorating corporate profits and stagnant personal consumption have pushed the economy into a recessionary phase. In accordance with its subtitle, "Change this critical situation into a good opportunity," the latest strategy suggests: (1) radically improving productivity to wring out even more from the nation's few natural resources; and (2) fully promoting globalization in order to maximize the benefits of rapid economic growth in the Middle East, Russia, Australia, and other countries. The proposed specific measures to conserve resources include promoting intensive investment by lowering taxes on capital investment. For instance, a group of companies at an oil complex would get tax breaks if they jointly replaced old boilers with poor thermal efficiency with start-of-the-art equipment with superior thermal efficiency. Tax preferential measures for energy conservation usually target efforts by a single company for a single facility. But the new strategy support joint efforts by multiple companies. The report also proposes measures to help install solar power generation systems, to improve distribution efficiencies by having container terminals operate around the clock and other steps. Further, the report unprecedentedly calls for large companies to raise wages, focusing on rising consumer prices and the falling purchasing power of households amid stagnant income growth. In terms of globalization, the report stresses the need not only to boost exports to resource-rich countries and emerging countries but even to attract overseas funds and to bringing back the overseas income of Japanese companies. The report proposes measures to introduce a fund tax system to facilitate foreign capital to invest in Japanese firms through funds set up in Japan. It also calls for expediting the signing of investment pacts to facilitate domestic companies to invest in risky resource-rich and emerging countries. Small businesses are also encouraged to expand overseas. The new strategy mainly focuses on tax and fiscal measures, so it has not fully stepped into regulatory reform in medical and other areas. Additional regulatory-reform measures are also necessary to buoy up the nation's economy, besides tax and fiscal measures. Keidanren Chairman stresses firm support for extending refueling mission In a press conference yesterday, Japan Business Federation (Nippon Keidanren) Chairman Fujio Mitarai said regarding the Maritime Self-Defense Force's ongoing refueling mission in the Indian Ocean: TOKYO 00002495 008 OF 009 "I firmly support a plan to extend the mission. If the maritime operation is suspended, it may become impossible for Japan to obtain support for Japanese vessels' safe navigations from other countries. What is worse, a rift may occur in the Japan-U.S. alliance, the bedrock of Japan's diplomacy." Mitarai pointed out: "Japanese oil tankers and other vessels are continuing their voyages in the grip of an attack by pirates or terrorists." In connection with policy debate in the Liberal Democratic Party presidential election, he said: "I firmly back Japan's continued involvement in the war on terrorism." Asked about the presidential election campaign, Mitarai commented: "I would like the candidates to conduct active policy debate." He said that the focus will be on how to promote economic stimulus measures, a big-boned economic growth strategy, and reforming the tax, fiscal and social security systems in a package." He added: "I hope that the new government will continue to pursue the goal of returning the nation's primary balance to the black in fiscal 2011 as a measure to reconstruct the nation's financial system." (6) TOP HEADLINES Asahi: 70 PERCENT of coral lost in past five years in Sekisei reef lagoon off Okinawa Mainichi: Official campaigning to begin today for LDP presidential election amid expectation of general election Yomiuri: 40 PERCENT of LDP lawmakers likely to vote for Aso in LDP presidential election Nikkei: Economic, fiscal policies major issues in LDP presidential election Sankei: National livelihood poll: 57 PERCENT of families feeling financial pain Tokyo Shimbun: Tainted rice sold to 36 confectioners Akahata: JCP chairman delivers roadside speech in Shibuya (7) EDITORIALS Asahi: (1) Seven years since 9/11: Create new cooperation system Mainichi: (1) Pension records falsified by SIA officials (2) JR must make greater efforts for safety and public trust Yomiuri: (1) A waiver that shakes NPT to its core (2) Injection of public funds into two U.S. mortgage financing giants not enough TOKYO 00002495 009 OF 009 Nikkei: (1) Tainted rice exposes low awareness of food safety (2) Can Japan Sumo Association make fresh start? Sankei: (1) Georgia agreement pleases only Russia (2) Sumo needs bold reform Tokyo Shimbun: (1) Falsified pension records require thorough investigation (2) Sale of tainted rice no accident Akahata: (1) Minimum-access rice-import system no longer working properly (8) Prime Minister's schedule, September 9 NIKKEI (Page 2) (Full) September 10, 2008 08:41 Attended meeting of four cabinet ministers to discuss global warming. 09:30 Attended meeting of ministers related to pension-record issue. Met later with Finance Minister Ibuki. 10:01 Attended cabinet meeting. 12:54 Met with Chief Cabinet Secretary Machimura. 14:47 Met U.N. Association of Japan President Genshitsu Sen. 17:00 Attended the cabinet-hosted international consumer symposium held at Mita Kaigisho. 17:29 Met at Kantei with Deputy Chief Cabinet Secretary Futahashi. 18:37 Attended symposium hosted by the national council to establish consumers-centered administrative body held at Shinagawa Grand Central Tower. Chatted with Upper House member Masako Mori. 19:37 Attended funeral for the late writer Daikichi Terauchi at Zojoji Temple. 19:54 Attended "African Day Reception" at Roppongi Hills. 20:21 Returned to his official residence. ZUMWALT