DAILY SUMMARY OF JAPANESE PRESS 05/14/09

UNCLAS SECTION 01 OF 09 TOKYO 001093

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 05/14/09

INDEX:

(1) Senior U.S. official agrees to consider President's visit to
Hiroshima in response to Shizuka Kamei's request, calling it "very
interesting" (Jiji Press)

(2) BBC report that if DPJ takes over the reins of government, Japan
will not buy dollar-denominated U.S. government bonds sets off
dollar selling (Asahi)

(3) PNP Shizuka Kamei expresses willingness to actively purchase
U.S. bonds if government change occurs (Nikkei)

(4) Interview with former Prime Minister Yoshiro Mori: Ozawa's
resignation signifies Aso's victory (Yomiuri)

(5) With passage of extra budget at Lower House, choices lessens for
timing of Lower House dissolution (Nikkei)

(6) LDP banking on revival of "old bonds"; Risk of abandonment by
unaffiliated voters (Nikkei)

(7) Difference in eagerness evident between MSDF and GSDF on
elevating Japan-U.S. alliance to global stage (Mainichi)

(8) Marines, Okinawa's burden: 610 billion yen to be paid under
"false" pretext (Akahata)

ARTICLES:

(1) Senior U.S. official agrees to consider President's visit to
Hiroshima in response to Shizuka Kamei's request, calling it "very
interesting"

Jiji Com
10:44, May 14, 2009

Washington, Jiji Press, May 13

Shizuka Kamei, deputy leader of the People's New Party (PNP),held a
meeting with Gary Samore, coordinator for nonproliferation of
weapons of mass destruction of the National Security Council (NSC),
at the White House on May 13. He requested a visit by President
Barack Obama, who advocates a nuclear-free world, to the atomic
bombing site in Hiroshima when he visits Japan. Samore responded
with: "This is a very interesting proposal. We will consider it."

Kamei stressed that, "I greatly appreciate President Obama's
advocacy of a nuclear-free world. If the President makes his pledge
for efforts toward denuclearization before the monument at the
atomic bombing site as a representative of mankind, his appeal will
carry even more weight." He also pointed out that the impact will be
even greater if the President makes a speech at the peace memorial
ceremony held on August 6.

On relations with North Korea, Kamei asked that, "If the U.S. and
North Korea talk directly, the U.S. should not impose the results on
Japan ex post facto, but should hold close consultations with Japan
simultaneously." Kamei also met assistant secretary of
state-designate J.C. Bancroft Davis and Democratic Congressman
Sander Levin on the same day.


TOKYO 00001093 002 OF 009


(2) BBC report that if DPJ takes over the reins of government, Japan
will not buy dollar-denominated U.S. government bonds sets off
dollar selling

ASAHI (Page 6) (Full)
May 14, 2009

BBC of Britain on May 12 reported that Lower House member Masaharu
Nakagawa, "Next Cabinet" finance minister, made a remark to the
effect that if the Democratic Party of Japan (DPJ) takes the reins
of government, Japan will not buy dollar-denominated government
bonds. With the statement setting off dollar selling, the yen
exchange rate on the Tokyo Foreign Exchange Market briefly rose to
95 against the dollar on the 13th after a hiatus of about two
weeks.

In response to an interview with Asahi Shimbun, Nakagawa said what
he meant was that in order to avoid losses from exchange
fluctuations, too, the government should consider buying
yen-denominated U.S. government bonds instead of dollar-denominated
ones. He explained that he did not mean that the Japanese government
would not buy any dollar-based U.S. bonds.

Since the Japanese government would face valuations losses, if the
abrupt appreciation of the yen develops, DPJ lawmakers, including
Nakagawa, during Diet deliberations once urged the government to ask
the U.S. government to issue yen-denominated government bonds.

One can say that market responses to the overseas media report on
the remark of a DPJ lawmaker reflects that the possibility of a
change of power is growing. According to the U.S. Treasury
Department, Japan possesses as of February U.S. bonds worth 661.9
billion dollars, the second largest amount after China.

(3) PNP Shizuka Kamei expresses willingness to actively purchase
U.S. bonds if government change occurs

NIKKEI ONLINE
May 14, 2009 1:34 PM

"A change of government will certainly take place in Japan."
"(Japan) should help the U.S. rebuild its economy as much as
possible." People's New Party (PNP) acting head Shizuka Kamei, now
visiting the U.S., gave a press conference in Washington on May 13,
in which he disclosed that he had conveyed Japan's willingness to
actively purchase U.S. government bonds when he met with National
Security Council (NSC) Asian Affairs Director General Jeffery Bader
and other key members of the administration of President Barack
Obama. Government bonds are issued to finance economic stimulus
measures.

Kamei clearly said that a coalition government will be undoubtedly
established by the Democratic Party of Japan (DPJ),the Social
Democratic Party, and the PNP as a result of the next House of
Representatives election. (Jiji) reported a remark by DPJ "shadow
cabinet" Finance Minister Masaharu Nakagawa indicating that a DPJ
government would be reluctant to purchase dollar-denominated
Treasury Bonds. This remark prompted massive selling of the U.S.
dollar, pushing down its value. Bearing this experience in mind,
Kamei said: "I will never allow (a DPJ-led government) to do so. We
will extend full support to the U.S."


TOKYO 00001093 003 OF 009


With respect to the DPJ presidential race (scheduled for May 15) to
select a successor to Ichiro Ozawa, Kamei said: "A person who can
push ahead with election cooperation and policies with us must be
elected.

(4) Interview with former Prime Minister Yoshiro Mori: Ozawa's
resignation signifies Aso's victory

YOMIURI (Page 4) (Full)
May 14, 2009

-- Democratic Party of Japan (DPJ) President Ozawa announced his
decision to step down.

I had expected this development to some extent, but I had
anticipated it would come much later. I have been paying respect to
him as a politician who can do things boldly but elaborately, and he
takes decisive action. However, he did not properly deal with the
aftermath (of a fund-raising scandal that led to the arrest of his
secretary). He shirked his duty in this case, too.

-- Do you think Ozawa's resignation will affect Prime Minister Aso's
strategy on Diet dissolution?

I think there will be some impact. Even Mr. Ozawa said he would
select his successor after prospects are in sight for the fiscal
2009 supplementary budget bill to clear the Diet. He apparently
considers it is important to enact the extra budget, but it is
uncertain whether he bears the passage of the related bills in mind.
Assuming that the next president takes an "adult attitude" (such as
approving the enactment of the extra budget and related bills),such
a situation is not necessarily favorable for the Liberal Democratic
Party.

-- Some observers take the view that Mr. Ozawa's resignation would
result in calls for ousting Aso once again.

Mr. Ozawa's resignation obviously signifies the prime minister's
victory. Despite calls growing for Diet dissolution from outside
(the LDP) and calls for his replacement from within the party, the
prime minister has stuck it out. At a time when people have begun to
favorably evaluate (the prime minister),why is it necessary to
replace him? If trouble occurs in the party, its image will be
surely hurt. If there are members who do not notice this, they
should leave the party. I heard that former Secretary General
Hidenao Nakagawa had said, "We have yet to reach the point (of
beginning moves to dump him)." I am depressed by his remark that
could be interpreted as people waiting for a disturbance (in the
LDP). He might have some ulterior motive."

-- Do you think the cabinet should be reorganized before the next
House of Representatives election?

There is teamwork between members (in the cabinet). When the fiscal
2009 budget was enacted, I considered it would be desirable to
change the cabinet lineup and hold an election, but the situation
has changed since then.

-- Calls are growing for restrictions on candidacy by persons who
come from families of politicians.

What we should think first is whether the party can pick a candidate

TOKYO 00001093 004 OF 009


who can win, rather than considering whether heredity is good or
bad. Even if the son or wife of a politician is elected, the winner
should not be criticized because the voters made the choice. Such
criticism is unreasonable in view of the Constitution (which
specifies free choice of occupation). For now, I have no idea (about
suggesting to any of my kin to become a politician).

(5) With passage of extra budget at Lower House, choices lessens for
timing of Lower House dissolution

NIKKEI (Page 2) (Full)
May 14, 2009

With the supplementary budget for fiscal 2009 passing through the
House of Representatives, Prime Minister Taro Aso has now overcome
the first hurdle for the dissolution of the Lower House and a
general election. It is predicted that five bills related to the
extra budget, which include measures to help support corporations
facing capital shortfalls, will clear the Lower House in late May or
later. The handling of those bills is directly linked to an
extension of the current Diet session and to the timing of Lower
House dissolution. With less than four months left for the
expiration of the terms of the Lower House members, Aso's options
for the timing of the dissolution of the Lower House are gradually
lessening.

Implementation of 90% of the extra budget possible

Even if the opposition camp drags out deliberations on the extra
budget at the House of Councillors, the budget will be enacted on
June 12, 30 days after clearing the Lower House, based on the
constitutional rule. Therefore, more than 90 percent of the budget
for such measures as increasing employment adjustment subsidies and
granting 'eco-points' that give discounts on the purchase of
eco-friendly home electronic appliances, which are key elements of
the additional economic stimulus package. For Aso, who has placed
top priority on economic recovery, the enactment of the extra budget
is a requirement at least in determining the date for dissolution.

Of the six related bills, the tax system reform legislation,
including a reduction in the gift tax, cleared the Lower House along
with the extra budget. But a vote on the five other bills, including
one amending the Development Bank of Japan Inc. Law (New DBJ Law),
has been put off.

The prime minister's aide stressed: "We will enact all bills related
to the extra budget." Senior ruling camp members, including Liberal
Democratic Party (LDP) Secretary General Hiroyuki Hosoda and New
Komeito Secretary General Kazuo Kitagawa, confirmed yesterday
morning that they would make efforts to pass the related bills as
early as possible. Since the ruling coalition prioritizes
deliberations on the extra budget, it is predicted that the passage
of the remaining bills at the Lower House will be delayed to late
May or after.

If the Upper House drags out deliberations on the related bills, it
will be necessary for the ruling camp to consider using the
'constitutional 60-day rule' that allows the Lower House to readopt
them by the two-thirds votes of the lawmakers attending the voting
session. Many in the ruling bloc think that the ongoing Diet session
should be significantly extended by late July.


TOKYO 00001093 005 OF 009


The Emperor and the Empress will visit Canada and the United States
on July 3-17. The dominant view is that it is difficult to dissolve
the Lower House and kick off an official campaign for a general
election during that timeframe. The New Komeito has asked that the
general election and the July 12 Tokyo Metropolitan Assembly
election not be held close together. If that is the case, the Lower
House will be dissolved in last July and the election will be held
August 2 or 9.

Possibility of Lower House dissolution in June

Some LDP members have said that the Lower House should be dissolved
in June after the extra budget clears the Diet. Former Prime
Minister Shinzo Abe emphasized at an LDP lawmaker-hosted party
yesterday noon: "Most of the budget can be executed even if the
related bills are not enacted. I want (Aso) to make up his mind (to
dissolve the Lower House) at an appropriate time."

Abe and LDP Election Strategy Council Chairman Makoto Koga have
called for dissolution in June. The reason is that in case
dissolution is pushed forward as much as possible, it will turn
against the ruling camp's election campaign, because the image
becomes stronger that Aso was pushed into a corner. If eying on an
overriding vote in the Lower House on such key bills as the
antipiracy bill, a possible option would be dissolution in late June
and the general election on July 12, the same day with the Tokyo
election.

There is a possibility that the DPJ will regain party strength under
the new leader and that Aso will lose the best timing for
dissolution. There is also a possibility that the snap election will
be held 30 days before the terms of the Lower House members end or
in mid-October.

(6) LDP banking on revival of "old bonds"; Risk of abandonment by
unaffiliated voters

NIKKEI (Page 2) (Full)
May 11, 2009

Both the Liberal Democratic Party (LDP) and the Democratic Party of
Japan (DPJ) are working to deepen their "bonds" with industrial
organizations in anticipation of the House of Representatives
election that will come not later than this fall. Defying criticisms
of "pork barrel" spending, the LDP has incorporated many of the
demands of industrial groups in the FY2009 supplementary budget. On
the other hand, the DPJ is also giving priority to considerations
aimed at enlisting the support of groups supporting the LDP.
However, reliance on industrial associations may lead to abandonment
by unaffiliated voters.

On the evening of May 8, senior officials of as many as 40
industrial associations, including those from the construction
industry, land developers, the Japan Medical Association (JMA),and
so forth, assembled at a banquet hall in a hotel near the Diet. This
was a dinner party of the LDP and the senior officials of its main
support groups. Prime Minister Taro Aso, who stopped by, bowed
deeply and said: "We are working hard on the economic measures. We
hope for your support in the next election."

Budget for economic measures


TOKYO 00001093 006 OF 009


This was the first time in two years that representatives of the
LDP's main support groups have gathered in one place. The prime
minister personally filled the cups of the participants all around,
demonstrating his "desire to deepen bonds with these organizations
once again" (in the words of a senior official).

The LDP has been incorporating the demands of its support groups in
the economic measures since last fall. It has allocated an
additional 100 billion yen in de facto subsidies for rice production
adjustment (gentan) as a step to woo the Japan Agricultural
Cooperatives. Some 2.3 trillion yen in public work projects was also
appropriated in consideration of the construction industry, thus
shelving the policy of cutting back on public work implemented since
the Koizumi administration.

The LDP has not also forgotten the business sector. Party leaders
have held meetings with business leaders of Kansai, Tohoku,
Hokuriku, and elsewhere since the beginning of 2009. Mikio Aoki,
former chair of the LDP caucus in the House of Councillors, has also
held several meetings with senior officers of Nippon Keidanren
(Japan Business Federation),playing a role in the introduction of
the system of subsidies for buying environment-friendly cars.

Will moves suggesting the revival of old LDP politics, termed the
triangle of politicians, the bureaucracy, and business, be a quick
fix for the next Lower House election?

In mid-April, right after the ruling bloc compiled its additional
economic measures, the president of a small construction business
told a senior official of the Associated General Contractors of
Japan (Zenken): "We are in a situation of life or death. We have no
time to campaign."

"After the organization has disintegrated"

Zenken mainly consists of some 23,000 small and mid-sized
construction companies. In 2008, a record 580 companies went out of
business and 2009 is expected to see a continuation of this trend.
Officials are voicing their resentment, with one senior Zenken
officer saying, "It is too late to make budget allocations now that
the organization has disintegrated."

There is also a mood of "election fatigue" in organizations which
had fielded their own candidates in the last Upper House election,
such as the Nippon Izokukai (Association of War Bereaved Families)
and the JMA. After the next Lower House election, another Upper
House election is scheduled for summer 2010. A senior Nippon
Izokukai official says: "Even if you ask people to campaign for the
election two years in a row, the organization will not move."

At a meeting with former defense minister Yuriko Koike and others in
Tokyo on the evening of April 30, former prime minister Junichiro
Koizumi, who is blamed by the LDP for the weakening of LDP support
groups, stated emphatically that, "One cannot get elected by relying
on support organizations; the unaffiliated voters will run away."


(7) Difference in eagerness evident between MSDF and GSDF on
elevating Japan-U.S. alliance to global stage

MAINICHI (Page 2) (Abridged)
May 14, 2009

TOKYO 00001093 007 OF 009



The First Tokyo Seminar on Common Security Challenges was held in
March in Tokyo under the auspices of the Defense Ministry. The
seminar's purpose was to constructively discuss ways to facilitate
regional cooperation in the Asia Pacific region on common
challenges, such as disasters and terrorist attacks.

In a speech at the seminar, Administrative Vice-Defense Minister
Kohei Masuda boldly proposed defense cooperation among Japan, China
and South Korea by taking advantage of antipiracy missions in waters
off Somalia.

In late December, China sent its Navy to fight Somalia pirates. The
step was followed by swift decisions by Japan and South Korea to
dispatch naval vessels on antipiracy missions. What Masuda had in
mind was conducting joint exercises among Japan, China, and South
Korea in waters off Africa as a simulation of the envisaged East
Asia security system.

"The matter is being studied by a variety of channels," a senior
Maritime Self-Defense Force (MSDF) official said.

The MSDF's antipiracy mission has hidden strategic significances,
such as being the first overseas dispatch for defending Japan's
national interests in the postwar period and testing military
cooperation with China and South Korea. Forming ties with the U.S.
Africa Command (AFRICOM) is of greater significance, according to a
high-ranking MSDF officer.

The MSDF is scheduled to dispatch in late May a P-3C patrol plane
unit to Djibouti, Africa. Djibouti is the operation base for
AFRICOM, which was established in 2007. The U.S. media regard the
establishment of AFRICOM as a response to China, which has made
inroads into the continent with an eye on abundant natural resources
there. One of the AFRICOM deputy commanders is a civilian female
ambassador from the State Department. "Once ties are established
between the MSDF and AFRICOM, they are certain to help expand
Japan's diplomatic options," the senior MSDF official noted.

During the Cold War era, the MSDF's only partner was the U.S.
Pacific Command, which covered the area spanning from the west coast
of the American continent to the Indian Ocean. Following 9/11, Japan
has joined in the war on terror and the MSDF has sent senior
officers to the U.S. Middle East Command in Tampa, Florida, whose
area of responsibility covers the entire Middle East and part of
Central Asia. MSDF fuelers have refueled the naval vessels of other
countries (in the Indian Ocean). The MSDF is about to expand its
ties to AFRICOM and elevate the Japan-U.S. alliance to the global
stage.

Meanwhile, a certain psychological distance exists between the
Ground Self-Defense Force (GSDF),which has actively carried out
overseas missions, and the U.S. military.

GSDF Col. Ryuta Ando served as Japan's first defense attach in
Afghanistan for just over one year from January 2003. During that
period, he was engaged in the disarmament project in collaboration
with the forces of other countries. Western logic does not work in
warlord-controlled tribal societies. To collect weapons, there was
no other option but to forge relations of trust with tribal chiefs
through eating and drinking with them.


TOKYO 00001093 008 OF 009


"Every day, I became keenly aware of the complexity and the depth of
the society there. The U.S. military's highhanded approach of
pushing its military might to the forefront does not work. The only
thing the GSDF was able to do was to deliver fuel to the forces of
other countries, and Afghans' gaze became less hostile."

In January 2004, Japan sent GSDF troops to Iraq - for the first time
to a "battle field" - to offer reconstruction assistance. Every
dispatched GSDF member wore small Japanese flags on four spots: the
right chest, the left shoulder, the back, and the helmet.

Looking back on those days, then GSDF Chief of Staff Hajime Massaki
(currently a Defense Ministry advisor) made this comment: "We wanted
to make clear that the Japanese troops were different from the U.S.
forces and that their purpose was to support the Iraqi people's
reconstruction efforts rather than to occupy their land. That was
most important for ensuring the safety of the GSDF troops." The
GSDF's base was in the southern Iraqi city of Samawah, which is far
away from the U.S. military's base in Baghdad.

After withdrawing from Iraq, the GSDF has not been dispatched to
overseas. A mission in Afghanistan was temporarily projected, but
the U.S. Obama administration is reportedly expecting Japan to play
a nonmilitary role. The GSDF appears somewhat relieved.

Overseas missions will continue, and their objectives, activities,
and strategic significances are certain to change. How should Japan
deal with the U.S. military - the most powerful military force in
the world? The difference in eagerness between the GSDF and the MSDF
to deal with the U.S. military shows that the quality of the
Japan-U.S. alliance must change on the military front as well.

(8) Marines, Okinawa's burden: 610 billion yen to be paid under
"false" pretext

AKAHATA (Page 3) (Full)
May 14, 2009

The agreement on the "relocation" of U.S. Marines in Okinawa to
Guam, which will require the use of tax money by Japan as a
sovereign country for the construction of military bases on U.S.
territory, was approved by the Diet on May 13. This agreement, which
imposes the legal obligation to pay $2.8 billion (approximately 280
billion yen) for the construction of U.S. military bases in Guam,
was approved through extremely speedy deliberations - three days in
the House of Representatives and four days in the House of
Councillors - just more than a month after substantial debate began
on April 3. No solution has been found for the serious harmful
effects this agreement will have on the people of Okinawa and
Japan.

Reconfirmation

The first harmful effect is that the Marines' "relocation" to Guam
is tied to the promotion of the construction of a new base in
Okinawa as a "package." The agreement stipulates that the Guam
"relocation" will "depend on concrete progress" in the new base on
the coast of Camp Schwab (in Nago City, Okinawa) and so forth
(Article 3). This reconfirms the fact that all the plans for U.S.
Forces Japan (USFJ) realignment are one "package."

On this point, while Director General Kazuyoshi Umemoto of the

TOKYO 00001093 009 OF 009


Ministry of Foreign Affairs North American Affairs Bureau stated
that, "The Japanese government has indicated its intention (to build
the new base) in this agreement. This does not impose any new legal
obligation" at the Upper House Foreign Affairs and Defense Committee
on April 23, he had told the Lower House Foreign Affairs Committee
on April 8 that, "If there is no progress in one (Nago),the other
(Guam) will also be affected."

Possible increase of troops

Second, the excuse for the Guam "relocation" is that this will
"lighten the burden of the Okinawan people," but this was found to
be a complete lie. The government has stated repeatedly during Diet
deliberations that the "reduction of 8,000 troops" refers to the
reduction of the designated troop size and that the actual number of
troops to be relocated may change, which suggests that there might
even be an increase of troops. Thus, the very purpose of the
agreement, "reduce the burden of the local communities, including
Okinawa" (in the preamble) will be compromised.

Third, not only is the fiscal spending of $2.8 billion
(approximately 280 billion yen) completely unjustified, the forcible
implementation of this "relocation" will require unbridled further
injection of tax money.

The Japanese and U.S. governments agreed in the roadmap for USFJ
realignment in May 2006 that under the pretext of "reducing the
burden on Okinawa," Japan will foot the bill for some $6.1 billion
(approximately 610 billion yen) of the total cost of $10.3 billion
(approximately 1.03 trillion yen) for "relocating" 8,000 marines in
Okinawa and their families.

Of this amount, $2.8 billion will be direct fiscal spending, while
"investment and loans" will cover $3.3 billion for the construction
of housing for U.S. military families and other infrastructure.
However, failure to recoup such "investment and loans" will require
tax money to cover the loss. Furthermore, it was also found that
Japan may possibly have to shoulder the cost for not only the
relocation of the marines, but also expenditures for the
construction of navy and air force facilities and the training and
transport of marines.

Sacrifice

U.S. Marine commander General James Conway testified at a U.S.
Congress hearing on May 6 that a review of the Guam "relocation"
plan itself is possible. There is no guarantee that the U.S. side,
which is facing a serious economic crisis, will be able to implement
its share in the relocation cost without fail.

The "Guam" agreement, which sacrifices the Japanese people's
livelihood by imposing the supply of funds up to 2014 for such a
project, is absolutely unacceptable.

ZUMWALT