JAPANESE MORNING PRESS HIGHLIGHTS 10/17/08

UNCLAS SECTION 01 OF 08 TOKYO 002890

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: JAPANESE MORNING PRESS HIGHLIGHTS 10/17/08

Index:

Defense and security affairs:

1) U.S. Ambassador to Japan Schieffer explains to families of
abductees background of U.S. delisting of North Korea

2) U.S. nuclear-powered submarine Ohio puts into Yokosuka amid local
fears that it is equipped with nuclear-tipped missiles (Tokyo
Shimbun)
3) Two Chinese subs detected in mid-October by MSDF in the E. China
Sea; May have been trailing U.S. Navy carrier (Sankei)

Financial crisis:
4) Prime Minister Aso, reacting to continuing plummets in stock
market, says scope of U.S. capital infusion plan is insufficient
(Mainichi)
5) Narita Airport rumored as the site of an emergency G8 summit
(Mainichi)
6) Prime Minister Aso orders drafting of extra economic stimulus
measures to meet the continuing financial emergency (Asahi)

7) Foreign Minister Nakasone to host a cabinet-level Middle
East-North Africa conference (Asahi)
8) Japan pitted against Iran for the rotating non-permanent seat on
the UN Security Council (Nikkei)

Political agenda:
9) Prime Minister, while watching the economic situation, will make
a decision to dissolve Diet at month's end (Asahi)
10) Everybody is talking now about a Nov. 30 Lower House election
(Tokyo Shimbun)
11) Former Land and Transport Minister Nakayama, who quit his post
over controversial remarks, changes mind and will run for a seat in
the Lower House (Tokyo Shimbun)
12) Consumer Affairs Minister Seiko Noda took political
contributions in form of party tickets from shady outfit involved in
pyramid schemes (Tokyo Shimbun)
13) Senior Vice Minister for Internal Affairs Kurata allegedly
involved in scheme with NPO run by former secretary to bring bar
hostesses into Japan (Asahi)

Articles:

1) U.S. Ambassador to Japan Schieffer explains to families of
abductees background of U.S. delisting of North Korea

MAINICHI (Page 26) (Full)
October 17, 2008

Chairman of the Association of Families of Victims of North Korean
Abductions Shigeo Iizuka and former chairman Shigeru Yokota met
yesterday with U.S. Ambassador to Japan Thomas Schieffer at his
official residence in Minato-ku, Tokyo. The Ambassador explained the
background of the decision to remove North Korea from the list of
state sponsors of terrorism. He said, "The United States supports
the resolution of the abduction issue." In the 25-minute meeting,
the Ambassador sought the understanding of the abductees' families
on the delisting of North Korea, stating, "It is my personal
opinion, but if the Six-Party Talks were to fail, resolution of the
abduction issue would become difficult."


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2) U.S. nuclear-powered submarine Ohio makes first port call in
Japan at Yokosuka base

TOKYO SHIMBUN (Page 27) (Full)
October 17, 2008

The U.S. Navy's nuclear-powered submarine Ohio made yesterday a port
call at the U.S. naval base in Yokosuka, Kanagawa Prefecture, mainly
to allow its 155 crewmembers to rest. This is the first time for a
submarine that can carry 150 cruise missiles and can dispatch
special-operations troops to enter a Japanese port.

The 18,750-ton Ohio was commissioned in 1981. It was re-commissioned
in 2006 after undergoing remodeling due to the post-Cold War nuclear
reduction and the U.S. military's strategic shift for the war on
terror.

It is difficult to distinguish the Ohio, which used to be a
ballistic missile submarine for launching nuclear missiles, from a
vessel carrying nuclear weapons. For this reason, there is concern
that it will irritate neighboring counties.

3) MSDF detected two Chinese submarines in East China Sea that aimed
to threaten U.S. aircraft carrier

SANKEI (Top play) (Excerpts)
October 17, 2008

It became clear yesterday that the Self-Defense Forces had detected
earlier this month two Chinese submarines that were deployed in the
East China Sea. One of them is believed to be the same model as the
Han-class nuclear-powered attack submarine that intruded into
Japanese waters in November 2004. Around that time (early October),
the U.S. nuclear-powered aircraft carrier George Washington (GW),
which has just been deployed to the U.S. naval base in Yokosuka,
Kanagawa Prefecture, was cruising in the surrounding ocean area
toward South Korea. The Maritime Self-Defense Force has strengthened
surveillance activities involving P-3C patrol planes in the judgment
that the Chinese submarines tried to collect GW data and threaten
it.

According to the Defense Ministry, the other vessel besides the
Han-class submarine was a conventional submarine. The SDF detected
the two submarines outside Japanese waters. They did not enter
Japanese waters.

The GW was deployed to the Yokosuka base on Sept. 25 as the
replacement of the conventional aircraft carrier Kitty Hawk. The GW
left the Yokosuka base on Oct. 1 to attend the South Korean Navy
memorial event that was held off Busan on Oct. 7.

China, which is building new models as part of its efforts to beef
up its submarine capability, has been increasing the activities of
its submarines. There have been many cases in which Chinese
submarines conducted activities in the East China Sea in conjunction
with U.S. naval vessels. On Sept. 14, an MSDF Aegis-equipped vessel
spotted something like a submarine periscope of an unidentified
foreign submarine in waters off Kochi Prefecture. Although there is
a possibility that the MSDF vessel mistook a whale for a submarine
periscope, it could have been a submarine from China or Russia.

The two Chinese submarines detected earlier this month seem to have

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been collecting data on the GW, including sonic data, having waited
for it, based on the projection that the U.S. vessel would cruise
from Yokosuka to Pusan.

4) Aso: Size of U.S. capital injection "insufficient;" Remark
criticized as giving image of lack of unity among G-8 countries

MAINICHI (Page 2) (Full)
October 17, 2008

Seeing the U.S. stock market reeling again, Prime Minister Taro Aso
said in a meeting of the House of Councillors Budget Committee
yesterday: "Since it (the size of public funds prepared by the U.S.
to inject into the market) was insufficient, market players are
dumping stocks." He replied to a question by Kohei Otsuka
(Democratic Party of Japan).

The U.S. has decided to pump 250 billion dollars in public funds
into leading banks. Upon saying: "I think the measure has been
appreciated to some extent," Aso indicated that the scale of capital
to be injected was too small, remarking: "I understand that since it
is insufficient, market players are responding this way." The prime
minister's remark seems to have reflected his irritation at the
steep fall in Japanese stock prices. But the Group of Eight (G-8)
countries, including Japan, the U.S., and European countries,
jointly issued on Oct. 16 an emergency statement designed to contain
the ongoing global financial crisis in an effort to reiterate the
need for international cooperation. In reaction to the remark made
at such a time, a U.S. investment company member grumbled: "That is
a gaffe that gives the image of a lack of unity among the G-8
countries."

5) Aso futilely planned emergency Narita G-8 summit

MAINICHI (Page 5) (Full)
October 17, 2008

Prime Minister Taro Aso revealed in yesterday's Upper House Budget
Committee meeting that he had considered at one point hosting an
emergency G-8 summit at Narita to discuss a response to the
financial crisis but gave it up. He explained that coordination with
the countries concerned failed, saying: "We began (coordination),
thinking it was pragmatic to gather together at Narita for only four
hours. But some countries did not buy that idea." Aso was responding
to a question from Hiroyuki Arai of the Reform Club.

6) Aso issues instruction to draw up more economic measures later
this month

ASAHI (Page 1) (Full)
October 17, 2008

In response to the U.S.-triggered global financial crisis, Prime
Minister Aso called a meeting of members of the government and the
ruling camp at his official residence last evening. He instructed
the participants to hammer out a package of additional economic
measures focusing on people's livelihoods. Expressing his desire to
announce the specific amount and financial resources for
fixed-amount tax cuts, he instructed them to complete the package in
the week starting on the 27th. Regarding financial resources, Aso
said that the government will not depend on deficit-covering bonds
as much as possible.

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Aso cited as the areas that should be addressed on a priority basis
(1) people's livelihoods; (2) boosting the strength of the financial
sector and small businesses; and (3) protecting local economies. He
also instructed them to promptly map out a midterm plan on social
security and ways of funding it, including drastic tax reform to
secure necessary funds to raise the ratio of pension premium
payments to be shouldered by the government under the basic pension
program to half. He thus indicated his consideration to both
economic expansion and fiscal discipline.

State Minister in Charge of Economic and Fiscal Policy Yosano will
take the lead in drawing up the plan. Following the prime minister's
instruction, studies have already begun in the ruling camp on
fixed-amount income and residential tax cuts; policy tax cuts, such
as improvement in the securities preferential tax system and capital
investment tax cuts; lowering expressway tolls; and encouraging
financial institutions to extend loans to small businesses.

7) Foreign minister to take part in Middle Eastern cabinet-level
meeting

ASAHI (Page 4) (Full)
October 17, 2008

Foreign Minister Nakasone will leave for Abu Dhabi, the capital of
the UAE, to attend a cabinet-level meeting of the Forum for the
Future designed for cooperation between countries in the Middle East
and North Africa and the G-8 for economic development and reform.
Japan, the G-8 chairman, and the UAE will jointly host the meeting
this year.

This forum was launched in response to the Greater Middle East
Initiative, which the U.S. proposed and was agreed upon at the G-8
in 2004. Giving consideration to charges that the Forum is intended
to "impose democracy," it takes the form of the G-8 assisting those
countries' voluntary reform efforts on the political, economic and
social fronts. Non-governmental organizations will also take part in
the meeting.

8) Japan pitted against Iran for a United Nations Security Council
chair with election for a non-permanent slot coming on Oct. 17

NIKKEI (Page 8) (Excerpt)
October 17, 2008

The election of non-permanent members of the United Nations Security
Council by the UN General Assembly will take place on Oct. 17. Japan
is a candidate for the Asia seat, but it is pitted against Iran, a
country that has been hit with a sanction resolution by the UNSC for
its nuclear issue. Japan, which wants to become a permanent Council
member in the future, is bent winning this seat, with a diplomatic
source confiding, "Victory is assured. It will be decided in the
first round." Although Japan is favored to win, since under the
voting method used, the ballots are not signed, it will likely be a
hold-your-breathe election to the end.

9) Aso to decide whether to dissolve Lower House this month while
watching economic conditions

ASAHI (Page 1) (Excerpts)
October 17, 2008

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Following the passage of a supplementary budget for fiscal 2008 that
includes measures to buoy the economy, Prime Minister Aso started
considering yesterday whether to dissolve the House of
Representatives in November. He will come up with a final decision
by the end of this month upon carefully looking at movements of the
225-issue Nikkei Stock Average, which recorded the second steepest
ever fall yesterday, global financial conditions, and election
predictions.

Aso told reporters at his official residence last night: "The
current top priority task is to boost the economy. There also is no
option of sidestepping discussion of terrorism (the bill to extend
the law authorizing Japan's Indian Ocean refueling mission)."

In a House of Councillors plenary session yesterday, the extra
budget was enacted by a majority from the Liberal Democratic Party
(LDP),the New Komeito, the main opposition Democratic Party of
Japan (DPJ),and other smaller parties. The session also passed a
bill designed to cover gasoline tax revenue shortfalls in local
governments. Aso then instructed the government and the ruling
coalition to lay out more economic measures. The package is likely
to be completed in the week starting on the 27th.

The DPJ agreed to take an early vote on the bill to extend the
Maritime Self-Defense Force's refueling mission in the Indian Ocean
by another year, though it is against the bill, so the measure is
now likely to clear the Diet by a two-thirds lower chamber
overriding vote by Oct. 30. The stage for Lower House dissolution
will thus be set by the end of this month.

Many in the ruling camp, focusing on the importance of economic
measures, insist that the government should not allow the election
to slip into December so that the compilation of the budget later
the year will not be impeded. In order to set the date of the
election at sometime in mid-November, it will be necessary to
dissolve the Lower House within this month.

Aso is considering the possibility of delivering a street-corner
speech in Akihabara, Tokyo, on Oct. 26. Aso assumed the LDP
presidency in his fourth try. He was able to make himself better
known in this district, so he is expected to pick it as the place
for his first street-corner speech as prime minister in campaigning
for the next general election.

On the diplomatic front, Aso is scheduled to attend the Asia-Europe
Meeting (ASEM) in Beijing on Oct. 24-25. Arrangements are being made
for his meetings with Chinese and South Korean leaders on the
sidelines of the ASEM. He has also a desire to underscore
cooperation with the international community if an emergency Group
of Eight (G-8) summit is held to work out measures to contain the
global financial crisis

10) Growing possibility of Lower House election on Nov. 30; Prime
Minister Aso to make decision in late October

TOKYO SHIMBUN (Top play) (Full)
October 17, 2008

With the passage of the fiscal 2008 supplementary budget that will
allow the implementation of the government's economic stimulus
package, Prime Minister Taro Aso yesterday started considering in

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earnest the timing of the dissolution of the House of
Representatives that would be followed by a snap general election.
There is a growing view in the government and ruling parties that
after coming up with a second additional pump-priming package late
this month, the Lower House should be dissolved, and that the
official campaign should be kicked off on Nov 18 for a Nov. 30 snap
election. Aso will attend the summit of the Asia-Europe Meeting to
be held on Oct. 24-25 in Beijing. After that, he apparently will
make a final decision on the timing of Lower House dissolution,
after gauging the economic situation and how the Democratic Party of
Japan (DPJ),the largest opposition party, will respond.

Supplementary budget enacted

The outlook is that the appointment of a Bank of Japan deputy
governor, whose name the government presented to the Diet on Oct.
15, will be approved by the both chambers of the Diet on the 24. A
bill amending the new Antiterrorism Special Measures Law that allows
the Maritime Self-Defense Force to continue its refueling mission in
the Indian Ocean is also expected to be enacted late this month.

The Lower House's national basic policy committee yesterday
discussed a possible party-heads debate between the prime minister
and DPJ President Ichiro Ozawa. Although the ruling camp proposed
holding a debate on Oct. 29, the DPJ placed on hold its decision. As
a result, the two sides agreed to continue consultations.

The prevailing view in the ruling coalition is that an environment
for Lower House dissolution will be prepared if contentious issues
between it and the DPJ are clarified in a party-heads debate. This
would come after the compilation of a second economic stimulus
package, following the passage of the extra budget and the Indian
Ocean refueling bill. If the prime minister does not dissolve the
Lower House in late October, the event would be pushed back to the
end of the year or early next year in a bid to avoid affecting the
compilation of the fiscal 2009 budget. The fiscal 2008 extra budget
worth 1.8081 trillion yen was enacted as it was adopted by a
majority of lawmakers from the ruling parties, the DPJ, the People's
New Party, the Reform Club, and others at a plenary session last
evening of the House of Councillors.

11) Nakayama retracts decision not to run in Lower House election

TOKYO SHIMBUN (Page 2) (Full)
October 17, 2008

It was learned yesterday that House of Representatives member
Nariaki Nakayama had conveyed his intention to run in the next Lower
House election to seek a seventh term, withdrawing his earlier
remarks that he would not run for the race. He informed a senior
official of the Liberal Democratic Party's (LDP) Miyazaki
prefectural chapter. Nakayama resigned as minister of land,
infrastructure and transport to take responsibility for his
criticism of the Japan Teachers' Union, as well as for his other
controversial remarks.

However, strong criticism is being raised from within the Miyazaki
chapter, which has pushed ahead with the work of selecting another
candidate by advertising. Nakayama's move will likely become a new
source of confusion.

According to the senior Miyazaki chapter official, Nakayama said on

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the phone: "I have made up my mind as I was told by persons close to
me that I should run in the election. I will ask party headquarters
to endorse me. I will meet with party officials on the 17th."

12) Multilevel marketing company purchased fund-raising party
tickets for State Minister for Consumer Affairs Noda

TOKYO SHIMBUN (Page 1) (Full)
October 17, 2008

State Minister for Consumer Affairs Seiko Noda on October 16 made a
Diet question that can be taken as defending multilevel marketing.
In this connection, she told the Kantei that though she did not
receive any political donations or speech fees, she had a multilevel
marketing company buy fund-raising party tickets three times worth
140,000 since 2004.

Regarding the company that bought the party tickets, Noda insisted,
"It is a company that is operating legally." She intends to seek
understanding regarding the matter, revealing the facts at a press
conference after a cabinet meeting to be held on the morning of the
17th.

In the meantime, she admitted at the Upper House Budget Committee on
the 16th that she met with the trader in question before raising
that question in the Diet in order to talk about the Diet
questioning. Regarding this, she said, "I asked what business they
are actually engaging in, as I was supposed to ask that question."
She stressed that she was not asked about anything related to the
specifics of the question.

13) Senior vice internal affairs minister Kurata allegedly asked for
issuance of visa for Filipino women who worked as bar hostess; He
denies involvement

ASAHI (Top Play) (Excerpts)
October 17, 2008

The Shizuoka Prefectural Police in September raided an incorporated
nonprofit organization (NPO) on suspicion of forcing Filipino women,
who allegedly came to Japan to perform in charity concerts but
without an entertaining visa, to work as hostesses in Philippine
bars. Concerning applications for short-stay visas for these woman
submitted by the NPO, several sources of the Justice Ministry and
the Foreign Ministry, which are responsible for immigration control,
charged in their replies to questions asked by Asahi Shimbun that
Senior Vice Internal Affairs Minister Kurata (LDP member, elected
from the TOKAI proportional representation bloc),a Lower House
member, asked them to expedite the issuance of visas to those women.
The effective operator of this NPO is a former government-paid
secretary to Kurata. This secretary also allegedly asked the two
ministries to issue visas to them.

In response, Kurata said, "I have never made such a request. I do
not know why my name was mentioned. It is probably my former
secretary who mentioned my name." The former secretary explained,
"Mr. Kurata's supporter made that request. I was told by Mr. Kurata
to see what we could do. I worked out an arrangement that does not
infringe on law in consultation with relevant government offices.
The incident this time occurred, because the bars in question did
not observe the arrangement I had prepared."


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Philippine pubs in Japan have come under fire as a hotbed for human
trafficking. The U.S. Department of State, for instance, placed
Japan on the Tier 2 Watch List. In response, the Justice Ministry
further tightened qualification for the issuance of an entertaining
visa. As a result, the issuance of entertaining visas to Filipinos
sharply dropped from 80,000 recorded in 2004 to the 5,000 range in

2007.

However, there were many cases in which Filipino women came to Japan
on a short-stay visa in the name of taking part in charity concerts.
Determining that there is a possibility of irregularities about this
kind of entry into Japan, police and immigration authorities made
secret inquiries throughout the nation. In September this year, the
Shizuoka Prefectural Police raided the "Future, Charity Planning
Committee," an organization that dispatched Filipino women to five
pubs and "Mirai," an NPO -- both are located in Shizuoka Prefecture.
They arrested the owner (47) of the Philippine pub "Class-Metz,"
which has deep connections with both organizations, on suspicion of
violating the Entertainment Business Control Law (operation without
license) and the Immigration Control and Refugee Recognition Law
(encouraging illegal work).

According to the investigation conducted thus far, the "Future,
Charity Planning Committee" started applying for short-stay visas
for many women from around the spring of 2007 for charity shows to
support the reconstruction of Leyte Island, which was hit by
landslides. Those women appeared in concerts hosted by the
Philippine Embassy. In the meantime, they were also dispatched to
five Philippine pubs in Hamamatsu City.

According to the allegations given by sources familiar with the
matter, Kurata worked on Foreign Ministry and Immigration
authorities several times, saying, "Please see to the charity
concerts." According to sources related to the NPO, Kurata's former
government-paid secretary had been involved in the organization
since its foundation and served as a point of contact from related
government agencies to the NPO. He also allegedly made frequent
inquiries about the issuance of visas.

Kurata is an attorney. He was first elected in the 2000 Lower House
election. He is now a third-term Lower House member. H once served
as director of the LDP Judicial Affairs Division.

SCHIEFFER