DAILY SUMMARY OF JAPANESE PRESS 06/10/09

UNCLAS SECTION 01 OF 09 TOKYO 001304

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 06/10/09

INDEX:

(1) MSDF at the scene of anti-piracy operations: On standby for
collaboration with other countries (Tokyo Shimbun)

(2) Editorial: LDP proposals call for enhanced defense capabilities
to protect Japan (Sankei)

(3) LDP in turmoil over manifesto for Lower House election (Asahi)

(4) Editorial: Prime Minister Aso should squarely face structural
reforms in compiling basic guidelines (Nikkei)

(5) Cabinet Office estimates based on "big-boned policies, 2009"
show 12 PERCENT consumption tax needed for fiscal restructuring
(Asahi)

(6) Bill amending Child Pornography Prevention Law (Part 2) -
Interview with DPJ Upper House member Keiko Chiba: Regulations on
anime should be discussed separately (Yomiuri)

ARTICLES:

(1) MSDF at the scene of anti-piracy operations: On standby for
collaboration with other countries

TOKYO SHIMBUN (Page 3) (Full)
June 10, 2009

Shigeru Handa, editorial staff member, from Gulf of Aden

The Maritime Self-Defense Force (MSDF) escort ships dispatched to
waters off Somalia for anti-piracy operations navigate along
commercial vessels and rush to the rescue of foreign ships seeking
help. How will their operations change with the enactment of the
anti-piracy law expected to take place before the end of June and
the start of reconnaissance flights by the MSDF's P-3C patrol
planes?

Undaunted by military vessels

In addition to the vigorous anti-piracy efforts by the U.S.-led
Combined Task Force 151 (CTF-151, consisting of the U.S., Britain,
and three other countries),the UK, France, and five other European
Union countries have also launched their "Operation Atalanta."

Destroyers of six NATO states, including the U.S. and Germany, will
also be operating until the end of June. Countries including Japan,
Russia, China, and India are also engaged in their own operations,
crowding the sea off Somalia with naval vessels.

Captain Hiroshi Goto, commander of the MSDF contingent, says:
"Pirates have gotten used to naval vessels and they are no longer
intimidated." "They have come to attack after the ships have passed
or strike at their targets at night."

The mission of the escorts "Sazanami" and "Samidare" dispatched to
the Gulf of Aden is to protect ships related to Japan. However, they
have gone beyond their mission and rescued foreign ships six times
so far. After the anti-piracy law is passed, it will be possible to
crack down on pirates, and depending on how they react, gunfights
may occur.

TOKYO 00001304 002 OF 009



Escorting even when it's safe

Meanwhile, little change is expected in the main mission of
escorting ships. The MSDF has engaged in 25 such missions, escorting
a total of 82 ships so far, averaging 3.2 ships per operation, which
is way below the original estimates. According to the Japanese
Shipowners' Association (JSA),this is because of: (1) the sharp
drop in the number of ships passing by due to the global economic
recession; and (2) incompatible shipping schedules.

Furthermore, pirates use short ladders that are only 5 meters long
when attacking ships, so large ships with decks that are over 10
meters high from the sea are not targeted. Tankers which sail at the
high speed of 20 knots (approximately 37 kms per hour) are
relatively safe, but large ships like these and high speed boats are
the ones being escorted.

The JSA says that, "Ships that are easy targets do not pass through
the Gulf of Aden; they make a detour around the Cape of Good Hope."
One wonders how seriously the urgency of dispatching MSDF escorts
was considered.

Greater scope of activities

Nevertheless, a senior MSDF officer says that, "If the anti-piracy
law is passed, we will be able to escort ships of other countries
and will have a greater scope of activities." He adds that: "We can
also rotate with China, Russia, India, and other countries in
escorting ships. If we are able to collaborate with China in waters
off Somalia, this will contribute to confidence building." The MSDF
has begun to consider sharing security operations with other
countries.

Goto stresses: "We could be attacked while on escort duties. We are
always on alert that we may run into a large number of pirate
ships." With such a mindset, it is obvious that if the MSDF
concentrates on escort operations, it will not have any capability
to spare for cracking down on pirates. In which case, the
centerpiece of the new law will not be "suppression of pirates" but
"collaboration with other countries."

Quite apart from the new law, it appears that the two P-3C patrol
planes sent to Djibouti deep in the Gulf of Aden have great
significance. The only other countries operating one patrol plane
each in this area are Germany, France, and Spain. Since the U.S. has
sent its patrol planes to reconnoiter the interior, expectations are
high on Japan's P-3Cs.

A senior MSDF officer observes that "this is a very rare opportunity
for linking international cooperation directly to support for the
U.S."

(2) Editorial: LDP proposals call for enhanced defense capabilities
to protect Japan

SANKEI (Page 2) (Full)
June 10, 2009

The Liberal Democratic Party (LDP) has produced a set of proposals
calling for the retraction of the government's seven-year-old policy
of reducing the nation's defense spending.

TOKYO 00001304 003 OF 009



The countries surrounding Japan have shown a continuing trend toward
increasing their military spending. Japan is the only country that
is scaling back on its defense capabilities, and that is partly
contributing to a lack of balance in the region.

The National Defense Program Guidelines (NDPG),which specify the
nation's basic policy on defense buildup, are scheduled to be
revised at the end of the year. Coinciding with this revision, the
LDP Defense Division defense policy subcommittee, chaired by Hiroshi
Imazu, has come up with proposals highlighting the urgent need to
review the past policy of slashing the defense budget and
personnel.

This direction is appropriate for defending the peace and security
of Japan. The proposals will be submitted to Prime Minister Taro Aso
soon. The government should address the proposals in order to
clearly show its stance with the new NDPG to enhance the
effectiveness of the Japan-U.S. alliance and defend the country.

In the NDPG revision five years ago, the number of Ground
Self-Defense Force personnel was reduced from 160,000 to 155,000,
the Air Self-Defense Force's fighters from 300 to 260, and the
Maritime Self-Defense Force's destroyers from 50 to 47. Furthermore,
it was decided in the 2006 basic policies for economic and fiscal
management and structural reform, compiled under the then Koizumi
administration, to keep the nominal growth rate below zero over the
next five years.

Meanwhile, China's military budget has maintained a two-digit
increase over the last 21 years. According to Yearbook 2009 by the
Stockholm International Peace Research Institute, China took second
place following the United States for the first time last year. The
Chinese Navy's plans to build an AIRCRAFT CARRIER and to build up
the submarine force are of particular significance. Russia, South
Korea, and Taiwan have been increasing their military spending to
modernize their military capabilities, as well.

The proposals note that the improvement of national security
capabilities must not be treated in the same way as regular public
works projects, while pointing out that stretching funds among the
Ground, Maritime, and Air Self-Defense Forces has exceeded its
limit.

It is natural to increase the efficiency of defense spending based
on the need to restore fiscal health. It is also a state
responsibility to maintain necessary defense capabilities.

The proposals also urge the government to consider possessing
enemy-base strike capabilities without heavily relying on the United
States' striking power, with defense against North Korean ballistic
missile in mind. The need to develop cruise missiles is also
mentioned. It is important to demonstrate a resolute stance to
acquire the necessary deterrence capabilities so as not to yield to
the threat of North Korea.

The time has come for the Defense Ministry and the SDF to explain to
the public the fact that the nation's defense power is too weak to
secure the personnel and funds that are necessary for them to
perform their duties.

(3) LDP in turmoil over manifesto for Lower House election

TOKYO 00001304 004 OF 009



ASAHI (Page 4) (Full)
June 10, 2009

Yoshihide Suga, deputy chairman of the Liberal Democratic Party
(LDP) Election Strategy Council, assumed the post to head a project
team (PT),which is in charge of drafting a set of campaign pledges
(manifesto) for the next House of Representatives election. Suga,
who is a close aide to Prime Minister Taro Aso, had refused to take
the post after coming under severe criticism from LDP members for
his assertion that restrictions on hereditary candidacy should be
written into the party's manifesto for the next general election.
However, since nobody wanted to take that post, senior PT members
selected Suga their leader in a meeting yesterday. It is now obvious
that there is no one in control in the LDP.

Aso informally named Suga as chair of the project team in April, but
Suga refused to accept the offer in mid-May. Since then the project
team has been unable to hold its first meeting. Therefore, the work
of drafting the manifesto has been left pending.

A senior LDP member recently advised Suga that he should not assume
the post. Veteran LDP lawmakers have been highly dissatisfied with
Suga for his growing influence on Aso, although he is just a
fourth-termer in the Diet. He and a group of junior lawmakers came
up with their own plan to prohibit relatives of Diet members, who
will retire from now on, from running in the same electoral
district. With the emasculated plan compiled by the LDP's Reform
Implementation Headquarters, discord in the LDP over the hereditary
issue is gradually being resolved. However, Suga's assumption of the
post might rekindle such discord.

LDP Secretary General Hiroyuki Hosoda held a meeting yesterday with
Deputy Secretary General Nobuteru Ishihara, General Council Deputy
Chairman Hajima Funada, Policy Research Council Deputy Chairman
Hiroyuki Sonoda, Suga, and senior members of the project team.
Hosoda wanted to see the issue resolved under the leadership of the
four deputy chairmen. In the meeting, Ishihara said: "I think Mr.
Suga is an appropriate person to serve as chairman." Suga, however,
was reluctant first. Sonoda then told Suga: "Why don't you think of
the post as being a director." Suga finally accepted the offer.
Other members did not want to assume that post because it is
unpredictable whether the LDP can win in the general election. It is
unavoidable that if the LDP is defeated in the election, the PT head
will have to take responsibility for the loss along with Aso.

One of the LDP faction chiefs looked confident about silencing party
members calling for restricting the hereditary Diet seats, saying:
"The PT chief is just a moderator. He cannot speak his own view."
However, Suga has dwelled on the inclusion of his own ideas in the
manifesto. In the mapping out of the manifesto, Hosoda is trying to
control the offices of the secretary general, the policy research
council chairman, and the general council chairman, saying: "I want
them to give considerable thought first." But he also said: "I will
let Mr. Suga do things on his own." Since the authority of the PT
chief is unclear, the LDP will likely be thrown into further
confusion.

"I will make clear the differences between the ruling and opposition
camps at an appropriate time, and I will then ask for the people's
vote of confidence," Aso has repeatedly said this since last fall
when he pushed for the dissolution of the Lower House. However, the

TOKYO 00001304 005 OF 009


LDP has yet to come up with messages to promote itself to the
public, although the DPJ has played up its policy of eliminating
bureaucrats-controlled politics.

Election Strategy Council Chairman Makoto Koga, Suga, and other
official responsible for election affairs first thought that the LDP
should win the public on its side by changing itself, even if it
involves some pain. To that end, they suggested cutting more than 50
Lower House seats. When the DPJ said "80 seats" should be reduced,
Koga countered that "up to 180 seats" should be cut. However, the
New Komeito, which is alarmed about a reduction in the proportional
representation seats, reacted negatively to Koga's assertion.

Suga's call for restricting the hereditary system was aimed to
counter the DPJ. Suga also suffered a setback, facing strong
reactions in the LDP.

A review of the reduced-rice-acreage policy, on which Agriculture,
Forestry and Fisheries Minister Shigeru Ishiba took the initiative,
hit a roadblock due to opposition by the agricultural policy clique.
In addition, the tasks of splitting the Ministry of Health, Labor,
and Welfare and unifying kindergartens and nursery schools, which
were initially regarded as Aso's instructions, rapidly disappeared.
The results gave the impression of special-interest clique in the
Diet having strong influence in the LDP.

Although Aso intends to make clear differences on the consumption
tax issue with the DPJ, it is unclear when the sales tax rate will
be raised as long as he considers economic recovery as a condition
to hike the rate. Such a stance cannot become a major campaign
issue.

(4) Editorial: Prime Minister Aso should squarely face structural
reforms in compiling basic guidelines

NIKKEI (Page 2) (Full)
June 10, 2009

The government's Council on Economic and Fiscal Policy (CEFP) in
draft basic policy guidelines on economic and fiscal management and
structural reforms for fiscal 2004 indicated a new target of
recapitalizing the nation's fiscal base. The government has given up
on the present target of achieving a surplus in the primary balance
by fiscal 2011, putting it off until 2019. It will aim to lower the
ratio of outstanding obligations held by the central and local
governments to the gross domestic product (GDP) by the early 2020s.

Although revising the goal is unavoidable, the government will not
be able to obtain public understanding if it relies on tax hikes to
achieve the goal. Various industrialized countries, starting with
the U.S., have come up with more definite exit strategies designed
to achieve fiscal recapitalization and make their economies
stronger. The government is urged to incorporate a more convincing
action policy with the inclusion of a reduced spending plan,
structural reforms aimed at achieving sustainable growth in the
Japanese economy, and regulatory reform.

Basic policy guidelines are basic designs for economic and fiscal
management by the government. This is the first time for the Aso
administration to map out such guidelines. The draft proposes a
two-stage approach of the government doing its utmost in dealing
with the economic crisis and then striving to recapitalize the

TOKYO 00001304 006 OF 009


nation's fiscal base and realize a "peace of mind society."

It has now become hopeless to try to achieve the present fiscal
discipline target due to economic stimulus measures and a plunge in
tax revenues stemming from the sharp economic decline. Unless the
government comes up with a firm stance of maintaining fiscal
discipline, market confidence in fiscal administration will be lost,
allowing a sharp rise in government bond interest rates. It is
imperative for the government to set a new goal.

Achieving a surplus in the primary balance means achieving a
situation in which administrative expenses for the year can be
covered by tax revenues. The primary balance debts are enormous,
reaching 5.7 PERCENT of the GDP as of fiscal 2009 even with
exception of expenses for stimulus measures. According to the newly
set goal, this ratio is to be cut in half within five years before
the end of fiscal 2013, and a surplus is to be achieved by fiscal
2010, or in 10 years' time.

Meanwhile, the ratio of outstanding obligations to the gross
domestic product (GDP),which has reached more than 170 PERCENT , is
to be stabilized by the mid-2010s and then lowered. Since the
roadmap will change, depending on long-term interest rates and the
situation of the global economy, the recapitalization plan is indeed
on a tight rope.

The fiscal projection included in reference data presented at the
meeting envisages that the goal is to be achieved only after
incremental 3 PERCENT -7 PERCENT hikes in sales tax starting in
fiscal 2011. The basic policy guidelines give the impression that
they focus on strengthening the functions of social security and
that a policy of boosting welfare benefits is to be realized,
relying on future tax hikes. Resorting to increasing the financial
burden imposed on people in an easy-going manner is a problem. The
government should tighten up its lax spending as well as squarely
face drastic reform of the social security system, without backing
away from it.

The draft basic policy guidelines devote only half a page to
regulatory reform. Descriptions of growth strategy go no further
than providing limited items, such as solar energy generation and
promoting the employment of care-givers. It is important to promote
free trade agreements (FTA). However, there is nothing new in the
draft. The government needs to come up with a more in-depth policy.
That should contribute to fiscal recapitalization as well.

(5) Cabinet Office estimates based on "big-boned policies, 2009"
show 12 PERCENT consumption tax needed for fiscal restructuring

ASAHI (Top play) (Excerpts)
June 10, 2009

The draft "big-boned policies, 2009" spelling out the government's
basic policies for economic and fiscal reforms was presented to the
Council on Economic and Fiscal Policy (CEFP) on June 9. A new goal
for fiscal restructuring, the reduction of the deficit ratio in the
"primary fiscal balance" - which is an indicator of fiscal health --
by half in five years and the elimination of such deficits in 10
years is included. The Cabinet Office has come up with an estimate
that the achievement of this goal will require an increase in the
consumption tax rate up to 12 percent.


TOKYO 00001304 007 OF 009


The estimates were presented as reference material for the CEFP, so
the tax hike has not been incorporated into the "big-boned policies,
2009." However, it appears that State Minister for Economic and
Fiscal Policy Kaoru Yosano wants to clarify the tax rate necessary
for fiscal restructuring before the general election in order to
spur an active debate on the consumption tax. The "big-boned
policies, 2009" will be adopted toward the end of June and will
serve as the basis for formulating the FY10 budget.

The above goal will also be included in the election campaign
pledges of the Liberal Democratic Party (LDP),but the government's
consultations with the LDP, which wants to avoid discussions on tax
hikes and spending cuts before the election, are expected to
experience rough sailing.

According to the estimates presented by the Cabinet Office on June
9, if the consumption tax rate is increased in stages from FY11 to
12 percent in FY17, a surplus in the primary fiscal balance can be
achieved. On the other hand, achievement of this goal will be pushed
backed to FY21 if the tax rate is raised only to 10 percent, which
means "a surplus within the next 10 years" cannot be achieved.
Furthermore, both estimates are based on the assumption that
policies such as the annual cutback of 220 billion yen in social
security spending under "big-boned policies, 2006" are maintained
and expenditures other than social welfare will not increase even
after FY12.

At a news conference after the CEFP meeting, Yosano said that, "It
is inevitable that we should appeal to the people honestly about tax
reforms (including the consumption tax hike)." The Cabinet Office's
estimates reflect Yosano's thinking on funding social security cost
with the consumption tax increase and controlling public work and
other spending rigorously while working for economic growth.

At the CEFP meeting, Prime Minister Taro Aso said: "Sustained
spending reform, more robust economic growth, and the steady
implementation of radical tax reforms after economic recovery are
indispensable for the achievement of the goals for fiscal
restructuring. It will not be easy, but we would certainly like to
compile (the "big-boned policies, 2009') in this direction."

(6) Bill amending Child Pornography Prevention Law (Part 2) -
Interview with DPJ Upper House member Keiko Chiba: Regulations on
anime should be discussed separately

YOMIURI (Page 13) (Full)
June 9, 2009

-- What are problems under the current situation?

Child pornographic materials are being sold all across the nation.
Japan has been criticized (for its lax regulations). There is also
the problem of such materials flowing out of Japan on the Internet.
We have discussed this issue in the party, and we now recognize
child porn indisputably is categorized as sexual abuse.

In Japan, the rights of children have not been fully protected.
Although sexual exploitation and molestation of children have
commonly occurred, such acts have been overlooked. It is necessary
to protect children's basic rights.

-- The Democratic Party of Japan (DPJ) submitted its proposal on

TOKYO 00001304 008 OF 009


amendments to the law to the Diet in March. What are special points
in your proposal?

It is difficult to inflict penalties regarding child porn under the
current law. We recognize that the law is intended to defend
children's rights and protect children from sexual abuse. It
therefore is undesirable to give a wrong impression that the law is
intended to restrict freedom of expression.

That is why the DPJ changed the expression "child pornography" into
"materials portraying sex acts involving children." The party also
erased the vague expression, "materials that excite or stimulate
sexual desire," and instead decided to use this clear-cut
expression: "materials showing a child whose sex organ being exposed
or being touched by another person."

-- The ruling parties' bill suggests criminalizing even the
possession of child pornographic materials and videos, including the
case of such materials put in a computer.

Our proposal specifies that the act of acquiring child porn
intentionally should be subjected to punishment. If punishment is
inflicted on the simple possession of such materials, people who
happen to possess such materials before they know by such means as
the materials sent by others to their computers out of malice might
be improperly arrested. Rather, I expect authorities to investigate
and expose those who are selling or producing child porn under the
current law in a positive manner.

What is another feature in the DPJ proposal?

The penalties in the current law are too lenient. Violators of the
child prostitution law are sentenced to up to five years
imprisonment or a fine of up to 3 million yen. Violators of the law
banning child pornography face up to three years and a fine of up to
3 million yen. The DPJ draft proposes making these punishments
stricter, for instance, raising the three years to five years and
the 3 million yen to 5 million yen in the case of child porn.
Further, the proposal includes measures to provide care and
protection for victims of sexual exploitation. It also suggests
carrying out the investigation and verification of incidents and the
circumstances.

-- Some DPJ members are calling for caution about introducing
tighter regulations, on the grounds that the principle of freedom of
speech might be infringed.

All party members share the need to protect children's rights. But
some members are opposed to restrict sex-related businesses and
expressions. Although I do not think this is the best expression, we
have decided to use the expression "materials portraying sex acts
involving children," with the aim of dispelling the concern that
adult pornography or virtual expressions used in anime (animated
cartoons) and other materials may be restricted.

-- An increasing number of countries have strengthened regulations
on anime and other materials in order to protect children.

Some observers take the view that consciousness of viewing children
as toys tends to be created through materials portraying children as
sex objects.


TOKYO 00001304 009 OF 009


Regarding anime and computer graphics, which portray fictional
characters, discussion should be conducted separately, and necessary
measures should be taken. If we try to include regulations on these
materials in the law, it will become difficult to define what child
porn is. It will also become difficult to conduct investigations
smoothly, I think.

ZUMWALT