JAPANESE MORNING PRESS HIGHLIGHTS 03/31/08

UNCLAS SECTION 01 OF 15 TOKYO 000868 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: JAPANESE MORNING PRESS HIGHLIGHTS 03/31/08 Index: 1) Top headlines 2) Editorials 3) Prime Minister's weekend schedule (Nikkei) Defense and security affairs: 4) U.S. Navy deserter to be questioned by police in connection with slain cab driver; Sailor told friend by phone: "I stabbed him" (Yomiuri) 5) First time ever for a vacuum in Japan's host-nation support for U.S. forces stationed in Japan; U.S. postponing training moves (Yomiuri) 6) Japan to foot the bill for off-base facilities in relocation of Okinawa Marines to Guam (Mainichi) Foreign affairs: 7) Israel's premier told Prime Minister Fukuda last month that North Korea was aiding Syria with its nuclear program (Yomiuri) 8) U.S. Senate and both chambers of the Diet to engage in parliamentary exchange in June (Nikkei) 9) Kickbacks went to employee of Indonesian embassy in Japan for help in visa applications (Yomiuri) 10) Fukuda in press remarks cautious about criticizing China for its actions against Tibetan rioters (Tokyo Shimbun) Political affairs: 11) Text of Prime Minister Fukuda's press interview (Yomiuri) 12) A bridging bill to cover tax-related bills other than gasoline tax to be enacted today to avoid vacuum (Nikkei) 13) New Komeito comes out with its own proposal to put road-related taxes into general coffers in return to Lower House override of defeated gas-tax bill (Tokyo Shimbun) 14) As provisional tax rate runs out, government to assist strapped oil suppliers with subsidies (Nikkei) 15) Government is taking pains selecting third candidate for Bank of Japan governor to prevent another veto by the opposition-controlled Upper House (Nikkei) 16) Fukuda says his administration will ready an economic stimulus package in April (Yomiuri) 17) Fukuda not traveling during Golden Week holidays due to turmoil in the Diet (Sankei) 18) Relic from the ABE administration, the "Second Chance Office" in the Prime Minister's Office, quietly closed (Asahi) Polls: 19) Asahi poll: 58 PERCENT of public approve prime minister's proposed integration of road-relaved taxes into general coffers (Asahi) 20) Yomiuri poll: 70 PERCENT of public feel fearful about the worsening crime environment around them (Yomiuri) Articles: 1) TOP HEADLINES Asahi: Poll: 58 PERCENT of respondents favor Prime Minister Fukuda's proposal to move road-specific revenues into general account, 55 PERCENT opposed to keeping the status quo on using revenue for road construction TOKYO 00000868 002 OF 015 Mainichi: Survey: Cost of producing refuse-derived fuel at 52 facilities across the country twice the cost of incineration, increasing taxpayers' burden by 20 billion yen Yomiuri: Police to question U.S. Navy deserter about murder of taxi driver Nikkei: Dai Nippon Printing and other materials production companies to invest a total of 300 billion yen in production increase in liquid crystal for filters and glass substrate Sankei: Excellent Japan: Japan's shot-put manufacturer boycotts Beijing Olympics by rejecting order for production of shot put Tokyo Shimbun: MHLW to launch survey of welfare institutions across the country to examine situation of abused children Akahata: It is possible to incorporate road-specific revenue into general revenues immediately, JCP Diet policy chief Kokuta and policy chief Koike assert on TV programs 2) EDITORIALS Asahi: (1) Proposals for society of hope: Create vigorous community everybody can take part in Mainichi: (1) Decrease in money lending firms means consumer banking is recovering health (2) Rules on police questioning: Review of criminal justice system essential Yomiuri: (1) Kyoto Protocol: Simply making both ends meet meaningless (2) We hope the post of information analyst will be the first step toward breaking the vertically-segmented administrative system Nikkei: (1) Falling share prices a challenge for Japanese firms (2) Pay attention to reform in Bhutan Sankei: (1) Riots in Tibet: Japan needs to pressure Beijing to have dialogue (2) Japan should lead the way in medical checks for metabolic syndrome Tokyo Shimbun: (1) Beijing needs to meet with Dalai Lama so as to celebrate Beijing Olympics (2) Regional system council needs to have in-depth discussion on decentralization Akahata: (1) Turning point in hiring temporary workers has come TOKYO 00000868 003 OF 015 3) Prime Minister's Official Residence (Kantei) Prime Minister's schedule, March 28 NIKKEI (Page 2) (Full) March 29, 2008 08:25 Attended an anti-global warming promotion taskforce meeting at the Kantei, followed by a cabinet meeting. Health, Labor and Welfare Minister Masuzoe stayed on. 09:30 Met Deputy Chief Cabinet Secretary Iwaki at the Kantei. 10:22 Met Finance Ministry Budget Bureau Director-General Sugimoto. 13:00 Attended an Upper House Budget Committee session. 16:06 Attended an Upper House plenary session. 17:01 Met former LDP Secretary General Nakagawa at the Kantei, followed by Deputy Chief Cabinet Secretary Futahashi, joined in by Chief Cabinet Secretary Machimura and Assistant Deputy Chief Cabinet Secretary SIPDIS Saka. 18:09 Met Machimura. 18:32 Attended a Lower House plenary session. 18:37 Met LDP Secretary General Ibuki, Finance Minister Nukaga, and Machimura in the LDP presidential office. Ibuki stayed on. 19:01 Arrived at his official residence. 20:57 Attended the Lower House plenary session. 21:03 Paid courtesy visits to Lower House Speaker Kono, Upper House President Eda and ruling party leaders in the wake of Diet approval of the fiscal 2008 state budget. 21:53 Returned to his official residence Prime Minister's schedule, March 29 NIKKEI (Page 2) (Full) March 30, 2008 Morning Spent time at his official residence. TOKYO 00000868 004 OF 015 16:03 Gave an interview to Nikkei and other news organizations at the Kantei. 16:38 Returned to his official residence. 17:43 Dined at a Grand Prince Hotel Chinese restaurant with his wife, Kiyoko, and secretaries. 19:57 Returned to his official residence. Prime Minister's schedule, March 30 NIKKEI (Page 2) (Full) March 31, 2008 Morning Spent time at his official residence. 17:00 Appeared on the NHK program "An interview with the prime minister" 4) U.S. Navy deserter to be questioned by police in connection with laying of cab driver; Sailor told friend, "I stabbed him" YOMIURI (Top play) (Excerpts) March 31, 2008 In connection with the murder in Yokosuka City in Kanagawa Prefecture of Masaaki Takahashi (61),a taxi driver from Shinagawa Ward in Tokyo, it was learned on March 30 from the investigation of the special investigation unit of the Yokosuka Police Department that after the incident, the seaman (22) stationed at Yokosuka Naval Base whose name was on a credit card left in the taxi, called a friend who lived close to the crime scene and said, "I did it." The call indicates that he was involved in the incident. The sailor is now in custody of the U.S. Navy for the crime of desertion. The police investigative unit will soon formally ask the U.S. forces in Japan for investigative cooperation under the Japan-U.S. Status of Forces Agreement (SOFA) and question the sailor as in important witness in this murder case. According to a source in the investigative unit, the sailor is a U.S. citizen of Nigerian origin. The unit discovered from telephone records and other information that on March 19, immediately after the incident, the seaman called by cell phone a Nigerian friend. The sailor told him in the conversation such words as, "I did it," and, "I stabbed him." 5) Sympathy budget to expire, experiencing vacuum period for 1st time; U.S. military training relocation put on hold YOMIURI (Page 2) (Full) March 29, 2008 The House of Representatives Foreign Affairs Committee held a meeting of its directors yesterday, during which they agreed to take a vote on a new special agreement for the Japanese government to continue its sharing of costs for the stationing of U.S. forces in TOKYO 00000868 005 OF 015 Japan (omoiyari yosan or literally "sympathy budget"). The current special agreement is to expire at the end of this month, so there will be a blank period during which the budget cannot be executed until the new agreement comes into effect. The sympathy budget will experience a vacuum period for the first time since it was started in 1978. The Democratic Party of Japan (Minshuto) and other opposition parties have been raising questions about waste in the budget and have called for full-scale deliberations on the sympathy budget. At the same time, the ruling and opposition parties have been clashing over tax-related bills which led to a delay in committee deliberations on the sympathy budget. The government-proposed special measures agreement is a kind of treaty. In this case, the House of Representatives' decision takes precedence over the House of Councillors' decision as provided by the Constitution. The agreement will therefore automatically receive Diet approval 30 days after its passage through the House of Representatives. Accordingly, it is expected to come into effect in early May even if the House of Councillors' deliberations are protracted. During the blank period, however, the United States will have to shoulder wages for base workers, as well as charges for utilities. In addition, the U.S. military will also have to pay for relocating its fighter jet training. The Japanese and U.S. governments are now coordinating to postpone U.S. military training from Okinawa to other prefectures in Japan until May or later. The Japanese government, after the special agreement is approved, will reimburse the U.S. for wages and utilities paid. The Japanese government thinks the sympathy budget will not be substantially affected, according to a Foreign Ministry official. Meanwhile, the Japanese government has asked the U.S. government to pay temporarily for the costs during the blank period. However, the U.S. government has been withholding its answer. "There's no doubt that America's confidence (in Japan) will decline," Foreign Minister Koumura told reporters yesterday. "The Japan-U.S. alliance's deterrence (in the security area) may weaken," he added, "and I'm worried about that." 6) Japan to bear burden of off-base facilities as well as part of expense to relocate U.S. Marines to Guam MAINICHI (Page 1) (Excerpts) Eve., March 29, 2008 In connection with the relocation expenses of U.S. Marines on Okinawa to Guam under the realignment of U.S. forces in Japan, it was learned today that Japan and the United States are coordinating a plan for Japan to cover the construction of off-base infrastructure, such as a power generator to be used by local population in Guam as well. This would amount to one-tenth of the total infrastructure expenses at Guam of 740 million dollars (approximately 74 billion yen) that Japan will bear. At the time of the Japan-U.S. (force-realignment) agreement in May 2006, the Japanese government explained that infrastructure subject to the agreement would be facilities only within the base. It was anticipated that if it expanded any more, there would be criticism from the opposition parties and others. TOKYO 00000868 006 OF 015 With the total expense of 10.27 billion dollars for relocating the Marines from Okinawa to Guam, Japan's share was 59 PERCENT , amounting to 6.09 billion dollars (approximately 609 billion yen) This included the facilities related to the headquarters and living quarters, involving financing of 2.8 billion dollars (approximately 280 billion yen) and 740 million dollars in infrastructure. According to source in the Japanese government, coordination is continuing on Japan financing such infrastructure outside the Marine base as the power generator, water pipes and sewerage, and a garbage-disposal facility. In addition, regarding facilities within the base, it has been firmed up anew that such would include recreation facilities, including a golf course, as well as a hospital and fire station. These facilities, too, will most likely be discussed now as part of Japan's burden. 7) Israeli prime minister told Fukuda in February that Israel bombed nuclear facility in Syria that used DPRK help YOMIURI (Page 2) (Full) March 31, 2008 It became clear yesterday that during his visit to Japan in February, Israeli Prime Minister Ehud Olmert told Prime Minister Yasuo Fukuda that the military installation in Syria Israel bombed last September was a nuclear facility that received technological assistance from North Korea. According to a Japanese government source, Fukuda and Olmert discussed the issue between the two of them only via interpreters. Prime Minister Olmert called for close cooperation between the two countries in dealing with North Korea's nuclear proliferation, explaining that the "facility was under construction with assistance in information on design and engineers from North Korea," according to the source. 8) Japanese Diet to launch exchange program with U.S. Senate in June NIKKEI (Page 2) (Full) March 31, 2008 The two Diet houses will launch a parliamentary exchange program with the U.S. Senate as early as June. Upper and Lower House members plan to hold annual meetings with U.S. senators to exchange views on security and economic issues. According to the Secretariat of the House of Representatives, the Japanese Diet has this kind of annual meeting with the European Parliament and China's National People's Congress. Kenji Kosaka, vice chairman of the Liberal Democratic Party (LDP) Diet Affairs Committee, Jun Azumi, deputy chair of the Democratic Party of Japan (DPJ or Minshuto) Diet Affairs Committee, and others visited Washington on March 21 and discussed the matter with Senator Daniel Inouye and senators. They have reached a basic agreement to formally launch the program after the current Diet session ends. Japanese and U.S. legislators will boil down items on the agenda. Japanese lawmakers have discussed with European Parliament members cooperation between Japan and the European Union, as well as economic and trade issues. TOKYO 00000868 007 OF 015 9) Two firms paid 20 million yen in visa rebates to employee at Indonesian Embassy in Japan YOMIURI (Page 1) (Excerpts) March 31, 2008 The Yomiuri Shimbun has learned through its investigations that two Japanese companies handling commercial and other types of visas required in entering Indonesia had transferred large sums of money into a bank account of a 50-year-old Japanese employee of the Indonesian Embassy in Japan in Shinagawa Ward, Tokyo. The amount totaled approximately 20 million yen in five years through 2006. One of the two firms has admitted that the funds were rebates on issuing visas. The act might be a violation of the Law against Unfair Competition (bribery to a foreign civil servant). Investigative authorities are collecting information. The companies in question are National Business Support (NBS),a travel agency in Chuo Ward, and Far East Development Corp., a company in Minato Ward affiliated with a major Indonesian oil firm. According to the Yomiuri Shimbun's investigation, the Japanese worker has been responsible for issuing visas for over 10 years at the Indonesian Embassy, and 100,000 to 300,000 yen had been transferred from the two firms a month to his major bank account. It has been confirmed that in the five-year period through 2006, the NBS had remitted approximately 14 million yen and Far East about 6 million yen to his bank account. The embassy's official visa application fees range from 2,500 to 11,500 yen. According to Far East, the company transferred the money to the Japanese worker's bank account in compliance with his request to pay 4,000 yen per person apart from the application fees. 10) Fukuda cautious about criticizing China over Tibet situation TOKYO SHIMBUN (Page 1) (Full) March 30, 2008 Some European leaders have announced they will not attend the opening ceremony of the Beijing Olympics in August in reaction to China's continued crackdown in Tibet. In an interview to reporters assigned to the cabinet at his official residence yesterday, Prime Minister Yasuo Fukuda commented on this issue: "We must fully consider whether it would be proper at the present stage to voice criticism or to link the current tense situation over Tibet to the Olympics." Fukuda emphasized: "I expect a dialogue to be held between the parties concerned in a way acceptable to both sides." Citing the planned visit to Japan by Chinese President Hu Jintao in May, Fukuda said: "This year is important for Japan-China relations. It will be a good opportunity for both countries to develop bilateral relations." 11) Interview with Prime Minister Fukuda YOMIURI (Page 4) (Full) March 30, 2008 The following are main points of an interview with Prime Minister Fukuda: TOKYO 00000868 008 OF 015 Provisional tax rate for gasoline In order to avoid any confusion from arising with the end of this fiscal year just around the corner, I am making efforts in the hope of resolving the issue. If the provisional tax rate is scrapped as of April 1, as called for by the major opposition Democratic Party of Japan (DPJ),we will suffer a revenue shortage. We will need to get revenues from somewhere. A revenue shortfall in local governments would only interrupt business operations by such industries as road construction. I don't think the current level of the provision tax rate is higher than those of other industrialized countries. I wonder whether it is a good thing for our country to move in the direction of encouraging more carbon dioxide to be emitted by lowering the price of gasoline. I think it is imperative to keep at least the current level of the provisional gasoline tax rate. Selection of new Bank of Japan (BOJ) governor Given the unstable international monetary market, it is never desirable to leave the top BOJ post vacant. I hope (the DPJ) will pay as much respect as possible to the government's way of thinking. Possibility of a grand coalition As long as the current state of the divided Diet continues, some ideas are necessary. One idea would be for the ruling and opposition parties to hold policy talks. Forming a partial coalition aimed at dealing with a limited number of policy issues or other forms of a coalition is conceivable. Looking back on the past half year (since taking office),I've really thought things would not move forward. Making tenacious efforts to move politics forward is the only way for me to continue. Cabinet reshuffle I am not thinking at all about shuffling the cabinet at present, when the Diet is in session and tax system-related bills are yet to be approved. Possible dissolution of the Lower House Now that the economy is leveling off and monetary and economic situations are disturbing us, a judgment as to whether it is appropriate to (dissolve the Lower House) should take precedence over other matters. Tibet issue Speaking for Japan. we are worried about the current situation in Tibet. We hope the riots will be calmed down swiftly in a peaceful manner. We've already urged (Beijing) to secure transparency and also conveyed our position of welcoming a dialogue among relevant parties. We need to think whether now is appropriate to loudly criticize (Beijing) or link (Beijing's way of suppressing the riots) to the Beijing Olympics. Joint gas field development in East China Sea I want to make my utmost efforts to realize (joint development) TOKYO 00000868 009 OF 015 while protecting Japan's sovereignty. I'd like to resolve this matter as quickly as possible. Permanent legislation for overseas deployment of SDF I think it is essential to have a general law (or permanent law) on the overseas dispatch of Self-Defense Forces (SDF) in order for Japan to take part in international peacekeeping operations swiftly and effectively. If such legislation is enacted, Japan will be able to demonstrate its fundamental policy at home and abroad. This kind of law needs to be prepared as quickly as possible. But given the current situation in the Diet, doing so at present is quite difficult. 12) Stopgap bill on special tax measures except for those tied to roads to clear Diet today NIKKEI (Page 1) (Full) March 31, 2008 Of the government-presented bills amending the Special Taxation Measures Law, a stopgap bill extending the expiration of the provisional tax rates other than the road-related rates until the end of May is expected to clear the Diet today with approval by the ruling and opposition blocs. Besides the seven items on which the Democratic Party of Japan has been calling for extensions, such as the provisionally lowered registration license tax rates for the transfer of land ownership and an offshore market tax exemption for financial institutions, the stopgap legislation includes preferential tax treatment for acquisition of automobiles. Asked about the expiration of the provisional tax rates on gasoline and other items in an NHK program evening, Prime Minister Yasuo Fukuda said: "We still have one more day left. I want (the ruling and opposition parties) to discuss the matter so that (the bill can be passed) in time." At the same time, the prime minister underlined the need to reinstate the provisional tax rates quickly in order to minimize revenue shortfalls, indicating that the abolition of the provisional rates would throw the nation's finances into the red. The government-presented bill amending the Special Taxation Measures Law won the approval of the House of Representatives in late February. Under the Constitution, the Lower House can readopt the legislation by a two-thirds majority on April 29, 60 days after the bill was sent to the House of Councillors. The government and ruling bloc intend to aim for an early enactment of the legislation with the aim of reinstating the provisional tax rates. 13) New Komeito to ask LDP for party decision on putting highway tax revenues into general account starting in FY2009 as condition for Lower House revote TOKYO SHIMBUN (Top Play) (Excerpts) March 30, 2008 It is now highly likely that the ruling coalition will fail to put to a vote a bill amending the Special Taxation Measures Law to maintain the current provisional gasoline and other tax rates by the end of this fiscal year. The New Komeito decided yesterday that in such a case, it would call on the Liberal Democratic Party to set the shift of the tax revenues to the general account starting in FY2009 as a condition for using the ruling coalition's two-thirds TOKYO 00000868 010 OF 015 majority in the lower chamber for an override. Prime Minister Yasuo Fukuda announced in a news conference on March 27 that the government would open the tax revenues for general use in an effort to bring the Democratic Party of Japan to the negotiating table. If the gasoline prices are lowered on April 1 and prices raised again by a revote, the public will inevitably react strongly. In a bid to obtain public understanding, the New Komeito wants to show its determination to reduce wasteful spending as much as possible by shifting tax revenues into the general account. Specifically, the party will call on the LDP to adopt the prime minister's proposal as the party's decision. Within the LDP, though, many are still opposed to the plan. Given this, it seems difficult to unify views in the party by the time the bill is brought back into the Lower House for a revote on April 29 or after. Meanwhile, if the New Komeito refuses to offer cooperation, the LDP will be unable to secure the two-thirds needed for an override. In such a case, the prime minister and the LDP will be driven into a more difficult situation. LDP Policy Research Council Chairman Sadakazu Tanigaki and his New Komeito counterpart Tetsuo Saito met at a Tokyo hotel to discuss this matter yesterday. Both agreed (1) to call on the opposition bloc to hold talks on revising the bill amending the Special Taxation Measures Law, based on the prime minister's proposal, by both camps' policy affairs chiefs and to reach an agreement by the 31st; and (2) to continue to ask the opposition side to agree to hold talks if the bill is not passed within this fiscal year. The ruling coalition also hopes to discuss measures to avoid confusion after gasoline prices are reduced. 14) Provisional gas tax rate expires today: Government to provide interest subsidy to gas stations, following reduction in gasoline prices NIKKEI (Page 1) (Excerpts) March 31, 2008 Following an expiration of the provisional rate on the gasoline tax today, the tax portion of the gasoline price will drop by about 25 yen per liter for portions to be shipped from April 1. The government yesterday started coordination with the possibility of assisting gas stations suffering a loss of profits due to price-reduction competition. It plans to prevent an escalation of a confused situation stemming from a drop in gasoline prices by such means as providing an interest subsidy to gas stations when they borrow money from a bank and expanding their debt guarantee frameworks. The government intends to finance those measures from the special energy measures account, whose funds are drawn from revenues from the Oil and Coal Tax imposed on crude oil, natural gas and others. Coordination is now under way with the possibility of offering a subsidy worth several billion yen to the National Petroleum Dealers Association (NPA) as fiscal resources for the envisaged measures. An interest subsidy will most likely be provided through the NPA. Under the existing system, subsidies are provided to gas stations in order for them to cover part of their interest payment when they TOKYO 00000868 011 OF 015 borrow funds to diversify their business or they change or close down their business. Under the new system, gas stations suffering a deteriorated profit as a result of a decline in gasoline prices would also be eligible for subsidies. Gas stations would be able to borrow operating funds needed for the immediate future almost interest-free. 15) Who is appropriate for BOJ governor in terms of notion of separation of fiscal and monetary administration?: Government having difficulty choosing third candidate NIKKEI (Page 2) (Excerpts) March 31, 2008 The government is trying to choose a third candidate for Bank of Japan (BOJ) governorship, which has been left vacant. Its option is narrowing with Democratic Party of Japan (DPJ) Secretary General Yukio Hatoyama expressing his party's stance that the appointment of a person hailing from the Finance Ministry would be unacceptable. The government has yet to determine the aftereffect of the confrontation between the ruling and opposition camps over the special-purpose road construction funds issue. It is poised to cautiously reach a decision, including a decision on when to present a third nominee for a new BOJ governor. Prime Minister Yasuo Fukuda on an NHK television program yesterday rebutted the DPJ's assertion that fiscal administration must be separated from monetary administration: "I do not understand the meaning of separating fiscal administration from monetary administration. I rather believe that it is not until fiscal administration goes hand in hand with monetary administration that the Japanese economy can be managed properly." Asked about his image of a candidate, he simply replied, "It should be a person who meets the condition of placing the right person in the right job. The character of a candidate is also important, because a BOJ governor is responsible for managing a huge organization." Hatoyama during talks with his Liberal Democratic Party (LDP) counterpart Bunmei Ibuki on the selection of a BOJ governor on the 28th categorically said, "There is an atmosphere in the party that the fact that former Finance-Ministry-official candidates have been rejected twice must be taken seriously." Hatoyama once indicated his view that Hiroshi Watanabe, an advisor to the Japan Center for International Finance, or Haruhiko Kuroda, governor of the Asian Development Bank, would be acceptable, though QQui*/Lthey are former Finance Ministry officials. However, with the government presenting Toshiro Muto and then Koji Tanami -- both are former Finance Ministry officials -- in succession, opposition to the idea of picking a former Finance Ministry official is mounting in the DPJ with one saying, "BOJ governorship is not a post for a retired Finance Ministry official." The dominant view among government officials is that since there are almost no personnel who meet the condition that a BOJ governor must be versed in international financing, an eligible candidate would be limited to those who hail from the Finance Ministry or the BOJ." However, if it nominates a former Finance Ministry official for the third time and the DPJ rejects it, the administration would unavoidably lose its power base. TOKYO 00000868 012 OF 015 16) Fukuda reveals on TV program a plan to present economic stimulus measures in early April YOMIURI (Page 2) (Full) March 31, 2008 Appearing on an NHK TV program yesterday evening, Prime Minister Fukuda commented on the Japanese economy, over which uncertainty is looming due to such factors as the slowdown of the U.S. economy, the strong yen, and rising oil prices. He said: "It is impossible to resort to increasing government spending in the conventional way. There is also a limit to lowering interest rates. . . . We must work out policy measures to strengthen the nation's economic growth potential. I would like to buoy up the somewhat slowing economy by presenting a growth strategy in early April, moving up the initial schedule." He thus indicated his determination to energize the economy by setting forth measures to strengthen the nation's economic growth potential, focusing on improving small businesses' strengths and resuscitating local economies. Asked about last autumn's negotiations over an aborted grand coalition between the Liberal Democratic Party and the Democratic Party of Japan (DPJ),Fukuda said that thu negotiations were initiated by DPJ leader Ichiro Ozawa. In reference to the difficulties his administration has faced in implementing key policies given the opposition camp's control of the Upper House, Fukuda said: "I think that since Mr. Ozawa was fully aware that such a situation could arise sooner or later, he proposed considering a coalition. I felt the same way." 17) Prime Minister Fukuda unable to arrange tour of Europe during Golden Week, as Diet to reach crucial stage SANKEI (Page 5) (Slightly abridged) March 29, 2008 In the wake of the standstill in the divided Diet, Prime Minister Yasuo Fukuda is now unable to arrange a tour of Europe originally slated for the Golden Week holiday period in early May. The reason is that depending on how deliberations on a bill to maintain the provisional gasoline tax rate and other road-related taxes will turn out, a fierce battle may take place in the Diet during that period. It has been the practice for Diet business to go into recess during the holiday period recess. Taking advantage of the holidays, former prime ministers have traveled overseas. In 2000 when Japan hosted the Kyushu-Okinawa Group of Eight (G8),then Prime Minister Yoshiro Mori visited seven European countries in nine days. As the G8 host nation, Fukuda was eager to play up his political acumen by visiting European countries prior to the opening of the July G8 summit in Hokkaido. In order to get high marks in diplomacy, it is indispensable for the prime minister to visit other countries ahead of the international conference. Fukuda has visited only one G-8 member country -- the United States -- since he assumed office. He initially planed to visit Russia, TOKYO 00000868 013 OF 015 whose President Putin will step down on May 7, as well as major G8 members in Europe to exchange views on global warming and other main topics of discussion in the G8 summit. However, deliberations on the revenue-connected bill have not moved ahead smoothly in the House of Councillors. In the case the bill is delayed as long as possible under Article 59 of the Constitution, passage of the bill will be April 29 or later, when the Upper House ends its deliberation. Although the government and ruling parties intend to readopt the legislation in the House of Representatives, the main opposition Democratic Party of Japan (DPJ or Minshuto) and other opposition parties appear likely to submit to the Upper House a censure motion against the prime minister. If that occurs, the ongoing Diet session may reach a climax from April 30 through and May 2 -- weekdays during the Golden Week holiday period from late April to early May. In addition, Chinese President Hu Jintao is expected to visit Japan after the Golden Week holiday period. 18) Second Chance Office to be dissolved ASAHI (Page 4) (Full) March 31 2008 The office in charges of measures to support a second chance, which was a feature policy of former Prime Minister SHINZO Abe, will today be dissolved. The ABE administration suffered a crushing defeat in the House of Councillors election last summer, in part because it failed to assuage public dissatisfaction with the social disparities that were seen as widening under the government of Prime Minister Junichiro Koizumi. The incumbent administration of Prime Minister Yasuo Fukuda has been trying to narrow the gap by placing priority on policies that deal with the daily lives of the people, while removing the policy imprint from the ABE government, According to the Cabinet Secretariat, all fulltime office staff will be transferred to other offices as of April 1 and the office itself will be dissolved. The office chief and a planning officer will remain for the time being in their present posts to confirm the state of achievements of support measures, but they will concurrently have other duties. Award ceremonies by the prime minister for persons of merit will be discontinued. In 2006 a total of 94 Diet members attended in the inaugural meeting of the Parliamentary League to Support a Second Chance. The parliamentary group set the trend for the ABE government. However, a government source said: "Since the current prime minister has been having difficulty showing his own political identity, he probably wants to distance himself from his predecessor's policies." 19) Poll: 58 PERCENT favor Fukuda's general-purpose initiative over road tax revenues ASAHI (Top play) (Abridged) March 31, 2008 A total of 58 PERCENT favor Prime Minister Fukuda's overtures of incorporating gasoline and other road-related tax revenues into the state's general account budget from fiscal 2009, the Asahi Shimbun found from its telephone-based nationwide spot public opinion survey conducted Mar. 29-30. Those opposed to that idea accounted for 24 TOKYO 00000868 014 OF 015 PERCENT . Meanwhile, Fukuda has also proposed maintaining the rate of provisional taxation on gasoline in fiscal 2008 for road and other road-related infrastructure projects. Asked about this idea, "yes" accounted for only 31 PERCENT , with "no" totaling 55 PERCENT . Asked whether to support the leading opposition Democratic Party of Japan's (Minshuto) rejection of Fukuda's overtures, public opinion was split, with 40 PERCENT saying "yes" and 44 PERCENT saying "no." The Diet has been in turmoil over the gasoline tax. Asked about responsibility for that, 22 PERCENT answered the government and the ruling parties are more to blame, with 13 PERCENT saying the opposition parties are more to blame and 59 PERCENT saying both are equally to blame. As seen from these figures, many of the respondents regard both the governing parties and the opposition parties as responsible. The proportion of those who think "both are responsible" was 59 PERCENT among those who support the ruling Liberal Democratic Party, 50 PERCENT among DPJ supporters, and 64 PERCENT among those with no particular party affiliation. The approval rating for the Fukuda cabinet was 31 PERCENT (32 PERCENT in the last survey taken Mar. 1-2). The disapproval rating was 53 PERCENT (50 PERCENT in the last survey). In the breakdown of public support for political parties, the LDP stood at 31 PERCENT (29 PERCENT in the last survey),with the DPJ at 20 PERCENT (21 PERCENT in the last survey). 20) Poll: 70 PERCENT concerned about crime YOMIURI (Page 2) (Abridged) March 31, 2008 A total of 70 PERCENT are "very much" or "somewhat" concerned that they or their families may be involved in a crime and may become a victim, the Yomiuri Shimbun found from its yearly survey of the public. The figure rose 13 percentage points from the last survey taken in December 1998. Reflecting a growing sense of anxiety, a total of 79 PERCENT think they need to do something for security even if they have to pay for it to some extent. People once thought security was free, but that attitude now seems to be a thing of the past. The survey was conducted Mar. 15-16 on a face-to-face interview basis. In the survey, those who answered "yes" to a question asking if they fear that they or their families may become a crime victim were asked to pick one or more specific crimes that concern them. In response to this question, "fraud and scams" accounted for 58 PERCENT , followed by "home burglary" at 57 PERCENT , and "purse snatching and pick pocketing" at 45 PERCENT . The survey also asked people if they thought public security in Japan has improved or worsened over the past several years. To this question, those who think it has "improved" and those who think it has "improved to a certain degree" totaled only 12 PERCENT , and those who think it has "worsened" totaled 86 PERCENT . "Worsened" topped 80 PERCENT in all seven surveys taken in May 1995 and afterward. TOKYO 00000868 015 OF 015 Among those who gave negative answers, "weakening morals" accounted for 67 PERCENT , followed by "school or home education" at 47 PERCENT and "weakening community ties." SCHIEFFER