DAILY SUMMARY OF JAPANESE PRESS 03/21/08

UNCLAS SECTION 01 OF 07 TOKYO 000783

SIPDIS

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 03/21/08

INDEX:

(1) Interview with Kaoru Yosano: Need for consultative organ between
ruling and opposition camps (Tokyo Shimbun)

(2) Vacant BOJ governor's post: Explore ways to avoid domino effects
on policy making (Nikkei)

(3) 1 month after Aegis accident: Crew shortages rock safety (Tokyo
Shimbun)

(4) TOP HEADLINES

(5) EDITORIALS

(6) Prime Minister's schedule, March 20 (Nikkei) 6

ARTICLES:

(1) Interview with Kaoru Yosano: Need for consultative organ between
ruling and opposition camps

TOKYO SHIMBUN (Page 2) (Full)
March 21, 2008

The Fukuda government has been having difficulties in managing Diet
affairs under the present political distortion, in which the
opposition controls the House of Councillors. The newspaper
interviewed former Chief Cabinet Secretary Kaoru Yosano, who enjoys
the confidence of Prime Minister Yasuo Fukuda, and asked him about
his views on how the prime minister should overcome this difficult
situation. Yosano is one of the most famous debaters in the ruling
Liberal Democratic Party.

-- The helm of Bank of Japan is now vacant for the first time in the
postwar era.

Yosano: Under the present situation where the opposition parties
have the majority of the Upper House seats, (appointments requiring
approval of the two Diet chambers) are not smoothly approved unless
there is a process to coordinate views between the ruling and
opposition parties. In order to create such a process, careful
procedures should be taken.

-- Do you have any specific idea?

Yosano: In a bid to enact any bills, prior discussion is needed. It
is necessary to rebuild the decision-making system in the Diet.

-- Is it similar to a consultative organ between ruling and
opposition parties?

Yosano: Yes, it is. Such a consultative body should be open to the
public.

-- The Democratic Party of Japan (DPJ) has opposed the government's
bill amending the Special Taxation Measures Law, including measures
to retain the current provisional rates (including the gasoline
tax).

Yosano: Despite the realization that a failure to enact the bill
(before the end of the current fiscal year) will seriously damage

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the daily lives of the people, the ruling and opposition parties
have been continuing their jockeying for power. The public must be
disgusted by that. Politicians should hold consultations on a
revision of the tax reform bill with the determination to support
the people's livelihood and economy.

-- The DPJ plans to respond to consultations on the revising of the
bill but to stick to its policy of allocating highway tax revenues
for the general budget account, as well as of abolishing the current
provisional tax rates.

Yosano: The ruling coalition is flexible and is ready to discuss any
revision on the bill if there is a request. The DPJ has been
extremely adamant. I have found many questionable points in the
ruling camp's thinking. The Diet is a place where the ruling and
opposition parties should try to find compromise through
consultations. After holding debate, the parties should reach a
consensus.

-- The DPJ is eager to force the prime minister to dissolve the
Lower House at an early date.

Yosano: If the election takes place at a time when the support rates
for the cabinet and for the LDP are low, many LDP candidates will be
defeated. So, many legislators do not want to see an early Lower
House dissolution.

-- Are there any measures to deal with the divided Diet besides
establishing a consultative body?

Yosano: There is no way to immediately correct the lopsided Diet
situation. If there are any good measures, one is an alliance
between the LDP and DPJ and the other is political realignment.

-- It is said that it is difficult to reorganize political parties
under the present mixed electoral system of small and proportional
representation constituencies.

Yosano: I opposed the introduction of the present election system.
Under this system, there is a possibility that policies would lean
to populism and that party leadership would hold enormous power. The
system has many defects such as that it is difficult for those who
have no experience of serving as a Diet member to run in an
election, and that votes obtained by small parties become wasted
ones. The best choice is to re-introduce the multiple-seat
constituency system that would make political realignment possible.

(2) Vacant BOJ governor's post: Explore ways to avoid domino effects
on policy making

NIKKEI (Page 1) (Excerpts)
March 21, 2008

Stumbling twice in nominating a candidate for the Bank of Japan'
(BOJ) governor, the Yasuo Fukuda administration is beginning to
enter a precarious situation. The Democratic Party of Japan (DPJ or
Minshuto),the dominant party in the Upper House, showed how strong
its veto power has become by controlling the selection of a
candidate for BOJ governor.

Dysfunction at BOJ serious


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The government and the ruling parties were utterly inadequate when
faced with a personnel appointment system requiring Diet approval
under a situation in which the Upper and Lower Houses are on an
equal footing. A situation like this was not foreseen by the
system.

With the plan to gain support for promoting former Deputy BOJ
Governor Toshiro Muto to governor bogging down, the Kantei's
responses soon ground to a halt. It was slow to begin with in
submitting Muto as a candidate. It was also ill-prepared for the
disapproval of Muto that followed, although that should have
naturally been anticipated.

The administration does not have smooth channels to the DPJ. The
dysfunction of its information distribution system prevents the
Kantei from receiving correct information. An increasing number of
Liberal Democratic Party (LDP) members are criticizing the Kantei
and the party leadership for doing nothing.

The bill amending the Special Tax Measures Law incorporating an
extension of the provisional gas tax rate for special-purpose road
construction revenues will cease to be in effect, since it expires
on March 31. Unless the government reaches an agreement to revise
the bill with the DPJ, the price of gasoline will drop by 25 yen per
liter, starting on April 1.

Fluctuations in gasoline prices are bound to disrupt the lives of
the people. Unless the ruling camp once again adopts the bill by a
more than two-thirds majority in the Lower House at the end of
April, there will occur a tax shortfall of approximately 2.6
trillion yen, combining that of the central government and that of
local governments.

One senior DPJ member said: "Even if the expiration of the
provisional tax rate becomes likely, Prime Minister Fukuda would
still allow this to happen. He would make a decision to construct
roads by increasing the issuance of government bonds as a measure
targeting party members."

The prime minister has started considering reallocating all road
revenues to the general account starting in fiscal 2009. However,
the DPJ stands firm with its insistence on a total abolition of the
provisional rate. There are only 10 days left until the provisional
rate expires. However, there are no prospects for the bill being
revised.

The DPJ's stance of not responding to calls for a revision to the
bill, unless the ruling camp swallows all of its demands, raises a
doubt about its capability to take the reins of government. It
would be the responsibility of the top party in the Upper House to
find a settlement line with the ruling camp, instead of taking the
view that there must be a 25-yen cut in gasoline prices.

Dissolution card sealed off

The Fukuda Administration has been driven into a corner to this
extent due in part to the burden of the divided Diet. However, the
main reason is that it has sealed off its right to exercise the
right to dissolve the Lower House. If a general election is held
now, the massive ruing camp, which occupy two-thirds of seats in the
Lower House, is certain to lose a significant number of seats. A
prevailing view in the LDP is that there will be no general election

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before Lower House members' term of office expires next fall.

However, since the prime minister is unable to play the dissolution
card, options available to him in steering the administration have
been significantly reduced. Confrontation between the ruling and
opposition parties is going on with no light at the end of the
tunnel with the prime minister forgoing a scenario of dissolving the
Lower House, based on negotiations with the opposition camp, after
dealing with such pending issues as budget-related bills.

When the LDP suffered a crushing defeat in the Upper House election
last year, then Upper House LDP Caucus Chairman Mikio Aoki pointed
out that if the number of seats held by the ruling parties fell
below a majority, the administration would become a lame duck. That
is because opposition parties would take key posts, such as the
Upper House presidency and the Diet Steering Committee chairmanship,
disrupting smooth Diet deliberations.

As he predicted, deliberations by the Upper House Financial Affairs
Committee responsible for deliberating on the bill amending the
Special Tax Measures Law have not yet started. The Upper House has
now become the "house of resistance."

Ozawa-led DPJ stands firm on the policy of giving priority to the
game of politics of desperately pursuing an early dissolution of the
Lower House and a snap election. The only means left for the ruling
camp to counter the opposition camp is to adopt bills voted down in
the Upper House once again in the Lower House.

If politics remain unable to decide anything, both the ruling and
opposition parties would be criticized by voters. It is time both
camps to think hard about rectifying the divided Diet in order to
avoid domino effect on policy-making.

(3) 1 month after Aegis accident: Crew shortages rock safety

TOKYO SHIMBUN (Page 3) (Abridged)
March 20, 2008

Shigeru Handa, senior writer

A month has passed yesterday since the fatal collision of the
Maritime Self-Defense Force's Aegis-equipped destroyer Atago with
the fishing boat Seitoku Maru that left two fishermen lost at sea.
Investigative authorities are still looking into the causes of the
accident. However, several MSDF officers note that "what lies behind
the accident" is the problem of crew shortages. The manning level of
the MSDF's newly built destroyers, including the Atago, is high with
nearly a full crew on board. Even so, they say the risk of accidents
is growing. Why?

The MSDF has a total of about 44,000 personnel. Half of them are
assigned to surface units consisting of destroyers and other
vessels, and the other half are with air units that are made up of
P-3C patrol planes and other aircraft. The MSDF's air units have one
and a half times as many pilots as the number of airplanes ready for
possible skirmishes in the event of a contingency. In addition, the
MSDF's surface units only have crewmembers to match the number of
vessels.

Moreover, the crews of surface units have decreased from year to
year. A Yamagumo-class destroyer had a displacement of 2,150 tons at

TOKYO 00000783 005 OF 007


full load with a crew of 220. Its successor is a Takanami-class
destroyer, which is 4,650 tons and has a crew of 175. A destroyer of
the Takanami class is larger in size, but its crew is smaller with a
reduction of more than 20 PERCENT .

The MSDF has been introduced state-of-the-art technologies to
operate large ships with a small crew. Its surface units used to
sustain extreme crew shortages with the manning level of their ships
between 50 PERCENT and 60 PERCENT , so they were said to have no
one for their main battery. Unlike before, their manning level is
currently up to 90 PERCENT .

However, an MSDF staff officer noted that there are now fewer eyes
on the watch with reductions in the crew of MSDF vessels. The Atago
was also called into question over its lineup of watchkeepers. An
MSDF destroyer's watchkeepers rotate in four teams for two-hour
shifts, and its captain determines the number of watchkeepers for
each rotational shift. "There's a destroyer with 10 watchkeepers,"
the MSDF officer said. "And," he added, "there's also a destroyer
with eight watchkeepers." This officer went on: "If we have fewer
persons on duty, we may be late in discovering other ships. However,
our destroyers manage somehow to operate with a small number of
crewmembers. We cannot tell them to overwork themselves."

As if to endorse the MSDF staff officer's words, MSDF commanding
officers voiced their sense of crisis in an urgent meeting held Mar.
20 at the Maritime Staff Office. "There's no balance between the
level of troops and tasks," one said. Another said, "We cannot
afford to do anything else at all."

MSDF destroyers are mainly tasked with defending MSDF and U.S. Navy
ships against submarine and aircraft attacks. MSDF destroyers have
therefore had only to conduct training for antisubmarine and
antiaircraft warfare. Today, however, MSDF destroyers are tasked
with various missions. Accordingly, they have to train for operating
overseas, countering suspicious ships, inspecting ships, and
evacuating Japanese nationals overseas.

(4) TOP HEADLINES

Asahi:
International speculative money pushes up prices of daily foods,
such as wheat, soybeans

Mainichi:
What is justice - confessions by judges: The defendant's death was
not what I wanted

Yomiuri:
MOJ intends to raise the upper limit for the extension of period of
stay up to five years but to tighten measures against illegal stay

Nikkei:
Survey of major firms: Firms plan to hire more college graduates in
fiscal 2008, as well, but the percentage slows down with 9.1 PERCENT
on average

Sankei:
Tibet, Xinjiang Uighur autonomous region put on high alert

Tokyo Shimbun:
U.S. military personnel might have had a hand in murder of taxi

TOKYO 00000783 006 OF 007


driver with his goods found in the taxi

Akahata:
Canon to dissolve contracts with temporary employees in response to
public criticism

(08032105ku) Back to Top


(1) U.S. financial crisis: Injection of public money unavoidable
(2) Court decision on loyalty test employed by policy: time to
discard old investigation method

Mainichi:
(1) Gas tax: Ruling, opposition camps should make concessions
(2) Punishment on Japan Basketball Association: Long-term rule by
boss should not be tolerated

Yomiuri:
(1) Insider stock trading by certified public accountants: Just
pursuing individuals over wrongdoing will not settle the problem
(2) Series of child-killings: What decision will lay judges reach?

Nikkei:
(1) Five years of Iraq war have changed the world
(2) Puzzling greenhouse gas emissions estimate by Ministry of
Economy, Trade and Industry

Sankei:
(1) Five years since outbreak of Iraq war: Japan learns a weighty
lesson; Time to determine to defend national interests


Tokyo Shimbun:
(1) Measures to deal with global warming; Little time left until
Lake Toya G-8
(2) Strategy of zero-waiting list for nursery schools: Produce
results this year

Akahata:
(1) Iraq war -- Illegal aggressive war: Promote international order
for peace

(6) Prime Minister's schedule, March 20

NIKKEI (Page 2) (Full)
March 21

07:37
Met astronaut Chiaki Mukai and Education Minister TOKAI.

08:12
Spoke with Takao Doi, who is staying on the International Space
Station.

09:02
Met with former Chief Cabinet Secretary Yosano.

10:37
Met with former LDP Secretary General Nakagawa.

11:48

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Returned to his official residence.

13:47
Offered flowers for the victims of Tokyo Subway Sarin Incident at
Kasumigaseki Station.

13:56
Returned to his official residence.

16:24
Met with Special Advisor Ito.

SCHIEFFER