JAPANESE MORNING PRESS HIGHLIGHTS 1//09

UNCLAS SECTION 01 OF 12 TOKYO 000118 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 1//09 Index: 1) Top headlines 2) Editorials 3) Prime Minister's daily schedule (Nikkei) President Obama's inauguration: 4) Prime Minister Aso in statement congratulates President Obama, anticipates his leadership, and vows to "further strengthen the U.S.-Japan alliance" (Tokyo Shimbun) 5) Japanese political circles welcome and congratulate President Obama (Yomiuri) 6) Government readying for a March Aso-Obama summit meeting, with North Korea policy at the top of the agenda (Nikkei) 7) Aso wants to meet President Obama as soon as possible (Nikkei) 8) Government seeking to build a global relationship with the U.S. under Obama (Nikkei) 9) With the first U.S. Democratic administration in eight years, the Japanese government is hurriedly building up personal ties in Washington (Nikkei) 10) DPJ planning visit to U.S. in Feb-March (Asahi) 11) Kyoto University Professor Hiroshi Nakanishi: Obama administration will expect Japan to play an appropriate role in the alliance (Nikkei) Anti-piracy measures: 12) Ruling camp's project team on piracy issue has finished its work, except for weapons-use rules, which it has dumped on the government to resolve (Tokyo Shimbun) 13) Anti-piracy bill expected to be presented to the Diet in mid-March (Asahi) 14) MSDF vessels escorting off coast of Somalia will be able to protect foreign ships with Japanese on board from pirates (Mainichi) 15) The order to the MSDF to prepare to dispatch a vessel to pirate-infested waters off Somalia could come as early as tomorrow (Yomiuri) 16) Fire at Yokota Air Base levels old wooden structure but no casualties reported (Yomiuri) 17) The economy is suddenly turning worse, according to latest monthly report (Mainichi) Political agenda: 18) Democratic Party of Japan (DPJ) to block budget package from passage on Jan. 23 (Mainichi) 19) Ruling camp aims to adopt budget bills on the 26th after huge clash with the opposition (Nikkei) Articles: 1) TOP HEADLINES Asahi, Mainichi, Nikkei, Sankei & Tokyo Shimbun: Obama stresses "new era of responsibility" in inauguration address Yomiuri: Obama sworn in as America's first black leader, pledging to revive the nation TOKYO 00000118 002 OF 012 SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 1//09 Akahata: JCP member in Diet session calls for easing banks' credit crunch 2) EDITORIALS Asahi: (1) Challenge of renewal of America Mainichi: (1) Prime minister must close loopholes for repeated amakudari postretirement practice by senior bureaucrats (2) Health Minister Masuzoe must protect temporary workers as he promised Yomiuri: (1) Rich educational contents and stabile management needed for colleges operated by companies (2) New Toyota president expected to display ability to improve business performance Nikkei: (1) Make use of preventive fund injections to avoid uneasiness at fiscal year end (2) Attention paid to what measures Toyota would take under new management Sankei: (1) Make efforts to ensure safety of clone meat for consumption (2) Produce cosmopolitans through study of Japanese history as compulsory subject Tokyo Shimbun: (1) China's Defense White Paper: Neighbors' concerns growing (2) New Toyota president should take fresh approach to rebuild company Akahata: (1) The government should not waste 2 trillion yen in tax money 3) Prime Minister's Official Residence (Kantei) Prime Minister's schedule, January 20 NIKKEI (Page 2) (Full) January 21, 2009 06:59 Met Deputy Chief Cabinet Secretary Konoike, joined in by Deputy Chief Cabinet Secretary Matsumoto, at the Kantei. 08:31 Attended a cabinet meeting. Afterward met Matsumoto. 09:00 Attended an Upper House Budget Committee session. Afterward met former National Public Safety Commission Chairman Izumi. 12:01 Met at the Kantei Fukuoka Brand Promotion Committee Chairman Hasegawa and others, in the presence of LDP Chief Deputy Secretary General Harada, followed by government representative Yachi. TOKYO 00000118 003 OF 012 SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 1//09 13:00 Attended an Upper House Budget Committee session. Afterward had a chat with Upper House Budget Committee Principal Director Iwanaga. 16:31 Met at the Kantei Nishi-Nippon City Bank President Kubota. 17:04 Attended a regular monthly meeting of economic ministers. Afterward met Deputy Chief Cabinet Secretary Uruma. 18:40 Met LDP Reform Promotion Headquarters chief Chuma. 19:09 Dined at a French restaurant in Minami-aoyama with former Finance Minister Ibuki, Chief Cabinet Secretary Kawamura, and former Prime Minister Mori. 21:28 Returned to his official residence. 4) Aso hopes to further strengthen Japan-U.S. alliance TOKYO SHIMBUN (Page 2) (Full) January 21, 2009 Prime Minister Taro Aso yesterday released a statement expressing his sincere congratulations to President Obama on his inauguration. "I want to work together to strengthen the alliance between Japan and the United States and endeavor for peace and prosperity in the Asia-Pacific region and the world," Aso stated. Aso stressed: "I hope Japan and the United States, which are in a position to lead the world, will put together their insights, willingness, passion, and strategy. By doing so, I believe we will be able to create a better future." He also expressed his expectations, saying: "I hope the president at the head of excellent teams in various areas will display his outstanding leadership to overcome the difficult economic situation and other challenges, and produce significant results." Meanwhile, Ichiro Ozawa, president of the leading opposition Democratic Party of Japan (Minshuto),told reporters yesterday in the city of Toyama: "In Japan as well, the economic slump has hit many people. The government remains unable to take any effective measures. I think this will be an opportunity for people to think we must change from the old way of doing things." 5) Inauguration of President Obama administration welcomed by political circles: Aso: "I place hopes on his leadership;" Ozawa: "Japanese people will become aware of need for change" YOMIURI (Page 2) (Full) January 21, 2009 Ahead of the inauguration of President Barack Obama, voices of welcome and anticipation were heard In the Japanese government and political circles. Prime Minister Aso issued a statement reading: TOKYO 00000118 004 OF 012 SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 1//09 "I expect the new president will demonstrate leadership in successfully dealing with a host of difficult challenges, including the current severe economic situation, and achieve great results. ... Japan and the U.S. are allies sharing common universal values and strategic benefits. I would like to work together with the new president to further strengthen the Japan-U.S. alliance and make utmost efforts to bring about peace and prosperity into the Asia-Pacific region and the world." The new president is expected to be absorbed with tackling the nation's serious economic problems for the time being. Finance Minister and State Minister in Charge of Financial Services Shoichi Nakagawa expressed his desire to work in cooperation with the new Obama administration in overcoming the ongoing global financial crisis and other issues, saying: "I hope the new administration will find a breakthrough in dealing with the current difficult situation. As soon as my counterpart is named, I would like to hold talks with that person." Environment Minister Saito also expressed hopes for the policy switch of the U.S. on the global warming issue. He said: "Although the U.S. has not joined the Kyoto Protocol, Japan will fall in step (with the new administration) in leading the rest of the world." Democratic Party of Japan President Ozawa remarked in a press conference in Toyama City yesterday in hopes of the establishment of the U.S. new administration working favorably for a change of government in Japan: "Many people are feeling that the current Japanese administration (of Prime Minister Aso) remains unable to take bold measures while leaving policymaking in the hands of bureaucrats. I believe (the inauguration of the Obama administration) will remind the people of the need for change." 6) Government coordinating Aso-Obama meeting in March to deal with priority issues, such as North Korea NIKKEI (Page 2) (Full) January 21, 2009 In order to build a foundation of cooperation with the new U.S. Obama administration, the government will expedite efforts to coordinate views on priority policy issues, such as North Korea's nuclear program and the war on terror. The government intends to realize a first meeting between Prime Minister Taro Aso and President Barack Obama as early as March. But given the Aso cabinet's dwindling support ratings, political uncertainty may shackle Japan's relations with the United States. In a press conference yesterday, Foreign Minister Hirofumi Nakasone said: "It is important for the prime minister and I to meet with President Obama and (Secretary of State-designate) Hillary Clinton at the earliest possible time." North Korea is a critical issue for Japan. The U.S.' delisting of the DPRK as a state sponsor of terrorism created strains in relations between Japan and the United States last year. With that in mind, a senior Foreign Ministry official noted, "We want to crosscheck views early on regarding the nuclear and abduction issues." There are expectations in the Japanese government that now is a good opportunity to expand the horizons of the Japan-U.S. alliance, but TOKYO 00000118 005 OF 012 SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 1//09 there is concern, as well, that measures for strengthening bilateral relations may be put off. Under the divided Diet, prospects are unclear for the enactment of a new law to dispatch the Maritime Self-Defense Force on an anti-piracy mission in waters off Somalia. It is also difficult to send the SDF to serve in Afghanistan, a contribution the United States expects. The next Lower House election, which will take place by the fall, is also worrisome. The major opposition Democratic Party of Japan (DPJ) is advocating a fundamental revision of the Japan-U.S. Status of Forces Agreement and a review of the Futenma Air Station relocation plan. Should the DPJ take power and try to pursue such policy changes, a strong reaction from the U.S. would be inevitable. DPJ Secretary General Yukio Hatoyama wants to send a delegation to the United States at an early date to deepen mutual understanding. Meanwhile, in a press conference yesterday, DPJ President Ichiro Ozawa simply said this about the Obama administration: "Without knowing its actual policies, it is difficult to make any decision." 7) Prime Minister Aso eager to hold first summit meeting with President Obama NIKKEI (Page 2) (Full) January 21, 2009 Prime Minister Taro Aso made this comment to the press corps at his official residence yesterday about the establishment of the administration of President Barack Obama: "I pin hopes on this administration regarding the Japan-U.S. relationship. We must make efforts to strengthen bilateral relations." Touching on his first meeting with President Obama, the prime minister also said: "I hope to meet with him at the earliest possible time. The matter is under negotiation." He also issued a statement on Jan. 21 reading: "I would like to further strengthen the Japan-U.S alliance in cooperation with President Obama and to work for the peace and prosperity of the Asia-Pacific region and the world." 8) Searching for global relationship between Japan and U.S.: Afghanistan, U.S. forces Japan realignment to come into focus; Weight of responsibility sharing likely to increase NIKKEI (Page 2) (Full) January 21, 2009 The Japan-U.S. alliance will enter a new phase with the inauguration of President Obama. The new president advocates international cooperation, shifting away from the unilateralism of the Bush administration in its diplomatic stance. There is a strong possibility of the new administration seeking cooperation and international contributions from Japan not only in the security area, including the war on terror, but also in broad-based areas. With the U.S. prestige damaged by the Iraq War and financial turmoil, the bilateral alliance will be put to the test in connection with rebuilding a new world order, which President Obama aims to fulfill. Secretary of State-designate Hillary Clinton, referring to Japan-U.S. relations during a her recent confirmation hearing, called the U.S. alliance a cornerstone for American policy in Asia, essential to maintaining peace and prosperity in the Asia-Pacific region. Stressing that today's security threats cannot be addressed TOKYO 00000118 006 OF 012 SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 1//09 in isolation, Clinton clarified her stance of carrying out foreign policy based on the North Atlantic Treaty Organization (NATO) in Europe and Japan in Asia. In launching war with Iraq, the Bush administration put together a "coalition of the willing." As a result of this formula, U.S. relations with European countries became cool, while ties with Japan deepened. The Obama administration is expected to aim at returning to a stance of attaching importance to traditional alliances. Chances are that this will dilute Japan's presence, accordingly. Experts see the war on terror in Afghanistan and the U.S. forces Japan realignment issue as litmus tests for Japan's relations with the Obama administration. Their unanimous view is that specific actions will be sought from Japan. International cooperation is, in other words, sharing responsibility. The prevailing view is that Obama, who casts the battle line in Afghanistan as the main front in mopping up the international terrorist organization Al Qaeda, will unavoidably seek further cooperation from Japan. Another focus of attention is the relocation of Futenma Air Station, an issue that has come to a standstill. This is clear from the appointed of a number of officials in the Obama administration who are well-versed in the background of the relocation of Futenma Air Station, a policy course set during the Democratic Clinton administration. Secretary-designate Hillary Clinton referred to the use of "smart power" -- a combination of diplomatic, economic and military powers. The future course of the alliance will likely depend on whether the two countries can establish a cooperative relationship not only in the war on terror but also in various broad areas, including tackling global warming and providing more assistance to developing countries. 9) Establishing personal ties with U.S. Democratic administration imperative for government NIKKEI (Page 2) (Abridges slightly) January 21, 2009 Hiroshi Maruya, Washington The Obama administration's foreign policy team includes many experts well-versed in the Japan-U.S. alliance. But having experienced in the 1990s the Clinton administration's "Japan passing" -- attaching importance to China while slighting Japan - Japan will likely set as a top priority the establishing of personal ties with officials of the new Democratic administration, the first in eight years. President Obama's National Security Advisor James Jones is a former general in the Marine Corps. He is also close to Republican Senator John McCain, who attaches importance to the alliance with Japan. Both Joseph Nye, who is being mentioned as the possible next ambassador to Japan, and Kurt Campbell, who is to become assistant secretary of state for East Asian affairs, are known as Japan hands. In the Pentagon, former Secretary of Navy Richard Danzig, who is knowledgeable about the operation of the Japan-U.S. alliance, is likely to serve as advisor to President Obama. Although Japan takes pride in itself as having established good relations with successive Republican administrations, it has found TOKYO 00000118 007 OF 012 SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 1//09 Democratic administrations difficult to deal with. A sense of alarm grew as Secretary of State-designate Hillary Clinton, during the presidential campaign, published an article that stated "the relationship with China is our most important bilateral relationship in the 21st century," with no mention to Japan. "How President Obama is going to deal with China is important," an informed source said. The 1972 U.S.-China reconciliation under the Nixon administration rocked Japan, and in 1998, President Clinton visited China, bypassing Japan. Those events left hard feelings between Japan and the United States. There is a possibility that President Obama, who places high priority on the war in Afghanistan, will visit Asia early. For strengthening relations with the Obama administration, the government plans to draw on all members available, including former Vice Foreign Minister Shotaro Yachi, who became the government's special representative yesterday. 10) DPJ plans to send delegation to U.S. in February or March ASAHI (Page 4) (Full) January 21, 2009 The Democratic Party of Japan (DPJ) yesterday set a policy course of sending a delegation to the United States either in February or March in order to build ties with the new Obama administration. The delegation will be composed of senior party officials and those with party president experience. The thinking is to realize a meeting with Vice President Biden. According to a senior party official, the U.S. side has already been sounded out about the visit. Secretary General Yukio Hatoyama formally proposed the trip yesterday to President Ozawa, who approved it. Ozawa himself is thinking of putting off any visit to the U.S. before the next Lower House election, saying, "Until my party takes over the government, I will not be meeting Mr. Obama." 11) Japan's role expected even more by new U.S. government NIKKEI (Page 9) (Full) January 21, 2009 Commentary by Hiroshi Nakanishi, professor at Kyoto University School of Government The administration of President Barack Obama will probably expect Japan to play an appropriate role as an ally of the United States. What kind of measures Japan will present to deal with the economic and financial issues will serve as an initial test for the future of the bilateral relationship. Attention is now being fixed on whether Japan can exercise leadership in the upcoming financial summit slated for April in compiling measures to assist other Asian countries. On the international cooperation front, the question is whether Japan will be able to come up with effective and comprehensive measures to assist Afghanistan under limited conditions. The United States is also paying attention to whether Japan will dispatch the Self-Defense Forces to seas off Somalia to deal with piracy. For the Obama administration, which will be busy dealing with the TOKYO 00000118 008 OF 012 SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 1//09 economic crisis and Middle East issue for the time being, the North Korea issue, despite its gravity, will be relatively lower on the agenda. Unlike the former administration of President George W. Bush, who showed special consideration to the issue of North Korea's abductions of Japanese nationals, the Obama Administration would place more importance on resolving the nuclear issue. 12) Ruling coalition's project team approves antipiracy plan; Weapons use guidelines left unfinished TOKYO SHIMBUN (Page 2) (Full) January 21, 2009 The ruling coalition's antipiracy project team yesterday approved a government-proposed plan to send Maritime Self-Defense Force destroyers for maritime security operations in waters off the eastern African coast of Somalia under the Self-Defense Forces Law. Meanwhile, the focus is on what to do about guidelines for the MSDF to use weapons there. But the project team has left all the decision-making to the Defense Ministry. The opposition bench may hit the government for its equivocal weapons use guidelines, and MSDF commanding officers and their crew on an antipiracy mission may have to be compelled to bear a heavy burden. In November last year, British and Indian naval vessels fired on pirate ships in their shootouts. The project team has discussed whether the MSDF should be allowed to use weapons in this case. The MSDF is allowed to use weapons in its maritime security operations under a relevant law that governs police officers in the line of duty, but its use of weapons is limited to legitimate self(-defense or emergency evacuation only. The Cabinet Secretariat insists that the MSDF should use weapons in this case as well. However, the Defense Ministry remains reluctant, with one of its senior officials noting that the SDF has never been allowed to use weapons on its overseas missions. As it stands, the government is split within itself over the weapons use guidelines. The project team also failed in its meeting yesterday to work out a unified view. "The Defense Ministry will work it out in cooperation with other government offices," one of the project team's members said. The project team has now decided to leave it to interdepartmental coordination within the government. In the meantime, other countries have now sent battleships to waters off Somalia. The ruling coalition seems to have jumped the gun while leaving everything to the MSDF. MSDF Chief of Staff Keiji Akahoshi told reporters yesterday: "Since the MSDF's establishment, we've never had any discussion, study, or education regarding what to do about pirates. We have almost no idea what situation we will face." The Defense Ministry is going to create guidelines in detail for the MSDF to use weapons-or the so-called rules of engagement (ROE)-in consultations with other government offices. However, the government will not make public the guidelines. There will be no knowing what weapons will be used in what situation. In case the MSDF used weapons, the Diet cannot verify if it was really within the framework of the current law. The government will adopt a masterplan in a cabinet meeting. After that, the government will report it to the Diet, where the TOKYO 00000118 009 OF 012 SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 1//09 government will likely be pursued hard by the opposition parties. The government, should it fail to obtain public support for its MSDF dispatch plan, will be affected in the process of creating a new law against pirates. 13) Ruling camp's project team aims at mid-March for presenting bill to deal with piracy ASAHI (Page 4) (Excerpt) January 21, 2009 The ruling parties' project team on anti-piracy measures yesterday completed its mid-term compilation of standards of operation at the time of the dispatch of Maritime Self-Defense Force (MSDF) vessels to carry out a maritime policing action. The maritime action is placed as an interim emergency measure, pending the presentation to the Diet in mid-March a new bill with anti-piracy measures. The project team will make its final decisions on Jan. 22. 14) MSDF vessels to guard foreign ships carrying Japanese, according to outline of mission in waters off Somalia MAINICHI (Page 5) (Slightly abridged) January 21, 2009 The project team of the Liberal Democratic Party and the New Komeito yesterday approved a plan to send Maritime Self Defense Force's (MSDF) escort ships to pirate-infested waters off Somalia under a provision pertaining to the issuance of an order for maritime policing action and determined the details of the mission. Prime Minister Taro Aso will instruct Defense Minister Yasukazu Hamada this week to start preparations. The MSDF will launch escort operations in the waters in March, at the earliest. MSDF warships will provide protection to Japanese-registered commercial freighters, as well as foreign ships carrying Japanese people and goods. Since SDF officials are not allowed to arrest pirates, maritime safety officials with the judicial police authority will be on board. The project team agreed to allow troops during operations to use weapons only in the cases of legitimate self-defense and averting imminent danger. Regarding specific weapon-use standards, however, the panel just agreed to have the Defense Ministry set standards in cooperation with relevant government agencies. The government will also report on specific activities to the Diet after a decision is made in a cabinet meeting to issue an order for maritime policing action. Speaking before reporters last night, Prime Minister Aso emphasized the need for new legislation, remarking: "The government will do its best to prevent Japanese vessels and people from suffering harm. In this sense, what can be done under the provision for maritime policing action must be done as soon as possible." 15) Government to instruct MSDF tomorrow to start preparations for dispatching vessels to Somalia YOMIURI (Page 2) (Full) January 21, 2009 TOKYO 00000118 010 OF 012 SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 1//09 The government decided yesterday to have Defense Minister Hamada instruct the Maritime Self-Defense Force tomorrow to start preparations for dispatching its vessels to pirate-infested waters off Somalia, Africa. As soon as preparations are completed, the cabinet will approve the issuance of an order for maritime policing action in its meeting and then the defense minister will order a MSDF unit to send its troops. The government hopes that MSDF vessels will start guarding Japan-related ships from possible attacks by pirates in waters off Somalia in late March. Prime Minister Aso told reporters at the Prime Minister's Office last night: "We will make utmost efforts to prevent Japanese vessels and capable people from suffering harm. What can be done under the provision for maritime patrols should be done as soon as possible." The ruling camp's project team compiled an interim report in its meeting yesterday seeking the government to send MSDF vessels by invoking the provision for maritime policing action. The ruling parties will make the decision in a meeting tomorrow after coordinating views in the parties. 16) Fire occurs at Yokota base YOMIURI (Page 30) (Full) January 21, 2009 A fire broke out at the U.S. Yokota Air Base in the western Tokyo metropolitan city of Fussa at around 6:30 p.m. The fire occurred in a one-story wooden building that served as an accounting office, and the building was completely destroyed. No one was in the office when the fire broke out, and no injuries were reported. According to the Tokyo Metropolitan Police Department, the fire is unlikely to be a terrorist attack. At 8 p.m., the Tokyo Fire Department mobilized nine fire engines, including pumper trucks, at the base's request. According to the Yokota base, the office is situated about 300 meters northeast of Gate 2 along Route 16. The fire lasted for over six hours. The office is away from the houses of local residents, and the fire did not spread to those houses. The police are still investigating the cause of the fire. The office building was built in 1948, and about 120 employees, Japanese and American, are working there. The Yokota base straddles five municipalities, including Fussa City, and houses the headquarters of U.S. Forces Japan (USFJ). 17) Monthly economic report: Economy is worsening rapidly; Downward revision for four consecutive months; Exports, industrial output in serious situation MAINICHI (Page 2) (Full) January 21, 2009 State Minister for Economic and Financial Policy Kaoru Yosano on January 20 presented the January monthly economic report at a meeting of related ministers. The government revised downward the overall assessment of the economy for the fourth consecutive month, with the report noting that the economy is "rapidly worsening." This is the first downgrading of such a report for four straight months TOKYO 00000118 011 OF 012 SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 1//09 since the February-June period in 2001, when the economy was in recession due to the non-performing loans issue and the collapse of the IT bubble economy. Regarding specific items, the report adopts an unusual expression that exports and industrial output are "dropping very substantially" owing to the global recession. The government has revised downward its assessment of personal consumption, using the word "weakened." There is concern that diminished foreign demand is making companies quickly drop production and curtail employment, further aggravating the recession. The tempo of the economic downturn is faster even in comparison with that seen during two oil crises in the past, as well as the collapse of the real estate and stock markets at the beginning of the 1990s and the collapse of the information-technology bubble. The Cabinet Office has analyzed this situation, using the term "unprecedentedly rapid decline." In particular, the worsening of exports and industrial output, which have been assessed as "dropping very substantially," is serious. The value of exports in November dropped 26.7 PERCENT from the same month last year, marking the largest ever fall. The output of mined and manufactured products in November also marked its largest ever drop. A decline in exports and industrial output will likely continue into December and later. Consumer spending, which had been considered "almost flat," was downgraded for the first time in three months to "being in a weak tone recently," an expression indicating a downtrend. The Cabinet Office is increasingly alarmed about the situation, with one official noting that there is the possibility of employment adjustment affecting permanent workers after April. 18) DPJ to refuse to take vote on Jan. 23 on second extra budget MAINICHI (Page 2) (Full) January 21, 2009 The Democratic Party of Japan (DPJ),the largest opposition force, held yesterday an executive meeting at party headquarters, in which it decided on a policy of not accepting the ruling coalition's proposal a Jan. 23 vote on the fiscal 2008 second supplementary budget, which includes spending for the cash-handout program, and related bills. The ruling camp has kept its position of having the government deliver four speeches, including a policy speech by Prime Minister Aso Taro, on Jan. 26. However, the opposition bloc intends not to allow deliberations on the state budget for fiscal 2009 before the second extra budget for fiscal 2008 clears the Diet. As it stands, confrontation between the ruling and opposition parties will likely intensify again. Prior to the DPJ's meeting, four opposition parties -- the DPJ, Japanese Communist Party (JCP),Social Democratic Party (SDP) and People's New Party (PNP) -- held a meeting for their Diet affairs committee chiefs in the Diet building. They shared the view that since sufficient deliberations have not been held, they would not be able to allow a vote on Jan. 23. The four opposition parties decided to form a field survey team on TOKYO 00000118 012 OF 012 SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 1//09 the watari practice in which ministries and agencies arrange new jobs for retired bureaucrats multiple times. Based on the agreements in the Diet affairs committee chiefs, the DPJ's executive meeting confirmed that the party would call for holding intensive deliberations on the employment, economic and amakudari (golden parachute) practice, political and religious issues, as well as local hearings on the government's cash-handout program. The DPJ confirmed again that it would not agree to simultaneously holding deliberations on the fiscal 2008 second budget and 2009 budget, with Diet Affairs Committee Chairman Kenji Yamaoka saying: "It will be impossible because the House of Councillors refuses to do so." Meanwhile, the Upper House Budget Committee directors agreed to hold a question-and-answer session, inviting witnesses, on the employment problem. Although the ruling coalition urged to decide on a date for taking a vote, the opposition refused to do so. Therefore, the Diet schedule for Jan. 22 and after has yet to be decided. 19) Ruling parties aim to deliver four government speeches on Jan. 26 NIKKEI (Page 2) (Full) January 21, 2009 The ruling parties began yesterday looking into having four government speeches, including a policy speech by Prime Minister Taro Aso, delivered on Jan. 26 in a plenary session of the House of Representatives, even if the House of Councillors fails to take a vote by Jan. 23 on the second supplementary budget for fiscal 2008 and related bills, on which intensive deliberations are now being held in the Upper House. The ruling coalition appears to be defiantly set on delivering the four speeches even if the opposition abstains from the Lower House plenary session. Political maneuvering will continue to intensify between the ruling and opposition camps. Four opposition parties, including the Democratic Party of Japan (DPJ),agreed yesterday to refuse to hold a vote on the second extra budget this week. DPJ President Ichiro Ozawa, Secretary General Yukio Hatoyama and Upper House Chairman Azuma Koshiishi confirmed last evening that the party would not respond to a vote this week. The Upper House Budget Committee yesterday decided in an informal meeting to hold a question-and-answer session with the attendance of witnesses and general question-and-answer session today. However, the committee failed to decide on schedules for Jan. 22 and after. The opposition camp intends to seek intensive deliberations on the employment problem and the issue of watari practice in which retired bureaucrats are allowed to switch from one cushy job to another multiple times, in addition to the government's cash-handout program included in the second supplementary budget for fiscal 2008. ZUMWALT