JAPANESE MORNING PRESS HIGHLIGHTS 06/22/09

UNCLAS SECTION 01 OF 14 TOKYO 001401

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 06/22/09

Index:

1) Top headlines
2) Editorials
3) Prime minister's daily schedule (Nikkei)

Defense and security affairs:
4) Government allowed U.S. Navy vessels armed with nuclear weapons
to traverse Japan's five straits (Tokyo Shimbun)
5) U.S. government and Congress clash over future of F-22s, which
Japan would like to make its next generation fighter (Nikkei)
6) Congress could reverse ban on export of F-22s (Nikkei) 5
7) Under new antipiracy law, MSDF can now escort foreign vessels
traversing Gulf of Aden (Yomiuri)
8) Use of weapons still vague in newly enacted antipiracy law
(Tokyo Shimbun)
9) Eight destroyers being sent to waters off Somalia for antipiracy
operations under newly enacted law (Tokyo Shimbun)

North Korea problem:
10) Japan, U.S. present UN with additional list of sanction measures
against North Korea (Nikkei)
11) Liberal Democratic Party would like MSDF to take lead and not
Japan Coast Guard in chasing down North Korean ships for cargo
searches (Sankei)
12) Still remain high hurdles for Japan to search cargo of North
Korean ships on the high seas (Nikkei)

13) Japan to provide four Asian countries with yen loans to help
them fight global warming (Tokyo Shimbun)

Political agenda:
14) Ninety percent of bills sponsored by the government passed,
despite the divided Diet (Mainichi)
15) Democratic Party of Japan (DPJ) alarmed that the tide might
change for them in run up to election due to construction scandal
trial (Yomiuri)
16) LDP candidates in Tokyo assembly election distancing themselves
from Prime Minister Aso, viewed as a liability to their campaigns
(Yomiuri)

17) Cabinet Agency survey of attitudes toward quality of life finds
surprising percentage of Japanese happy despite the current economic
slump (Sankei)

Articles:

1) TOP HEADLINES

Asahi:
New strategy to reduce return of unsold books: Publishers to reduce
buy-back price; bookstores to earn more commission

Mainichi:
"Death March" of 800 American POWs: Japan apologizes after 68 years

Yomiuri:
Ministry of Agriculture, Forestry, and Fisheries regional offices'
massive disposal of labor union documents after officials working
for labor unions on official time uncovered

Nikkei:

TOKYO 00001401 002 OF 014


Requirements for kindergarten teachers, childcare workers to be
relaxed to reduce number of kids on day care centers' waiting list

Sankei:
Clashes in Iran: 10 dead, over 100 injured; Former prime minister
"does not fear martyrdom"

Tokyo Shimbun:
Soya, 4 other key straits have narrower territorial sea to allow
passage of ships carrying nuclear weapons

Akahata:
"JCP wind" from the grassroots: Chairman Shii campaigns in Tokyo

2) EDITORIALS

Asahi:
(1) Election and the Internet: Why not take advantage of the
convenience?
(2) Stockholder meetings: Capitalism and management to change

Mainichi:
(1) Amendment of Development Bank of Japan Law: What happened to
privatization?
(2) Subsidy to cars, home appliances: Make this an opportunity to
conserve energy

Yomiuri:
(1) Recommendations on decentralization of power: Stronger local
assemblies and auditors needed for decentralization
(2) Scholarships: Ensure repayment, expand the system

Nikkei:
(1) Change! Declining birth rate: change to life-oriented culture at
work places

Sankei:
(1) Declaration of economy bottoming out: Do not let up until
full-fledged recovery
(2) Policy for hiring teachers: We welcome this type of competition

Tokyo Shimbun:
(1) End of "great merger" of local governments: What was lost with
bigger size
(2) Slight increase in birth rate: Too early to feel relieved

Akahata:
(1) Political authorities unable to speak up against business
sector

3) Prime Minister's Official Residence (Kantei)

Prime Minister's schedule, June 20

NIKKEI (Page 2) (Full)
June 21, 2009

08:32 Took a walk around his official residence.
12:57 Visited the campaign office of a Tokyo assembly election
candidate in Hakusan.
13:25 Visited the campaign office of a Tokyo assembly election
candidate in Oji-honcho.

TOKYO 00001401 003 OF 014


14:34 Visited the campaign office of a Tokyo assembly election
candidate in Higashi-kurume.
15:16 Visited the campaign office of a Tokyo assembly election
candidate in Higashi-murayama.
16:00 Visited the campaign office of a Tokyo assembly election
candidate in Kodaira.
16:38 Visited the campaign office of a Tokyo assembly election
candidate in Koganei.
17:03 Visited the campaign office of a Tokyo assembly election
candidate in Fuchu.
18:29 Visited the campaign office of a Tokyo assembly election
candidate in Machida.
19:45 Visited a tailor in Kita-aoyama.
20:06 Returned to his official residence.

Prime Minister's schedule, June 21

NIKKEI (Page 2) (Full)
June 22, 2009

Morning Spent time at his official residence.
13:39 Filed away documents at the Hotel Okura.
16:24 Visited the Yaesu Book Center in Yaesu.
17:02 Visited the Bic Camera Yurakucho Store.
17:37 Returned to his official residence.
19:15 Dined at a sushi restaurant in Mishuku with his wife,
Chikako.
21:05 Returned to his official residence.

4) Soya, 4 other key straits have narrower territorial waters to
allow passage of U.S. ships carrying nuclear weapons; Government
avoided violating 3 non-nuclear principles

TOKYO SHIMBUN (Top play) (Abridged)
June 22, 2009

It was learned on June 21that the government had limited the
territorial sea to only 3 nautical miles (approximately 5.6
kilometers) at Soya, Tsugaru, and three other important straits
instead of the legally allowed 12 nautical miles (approximately 22
kilometers) in order to avoid making nuclear arms carried on U.S.
military vessels a political issue. Behind this government decision
is the secret agreement exchanged at the time of the revision of the
Japan-U.S. Security Treaty in 1960. Several former parliamentary
vice ministers of foreign affairs have revealed the above to Kyodo
News.

U.S. strategic nuclear submarines responsible for nuclear deterrence
operations in the Sea of Japan facing the Soviet Union (now Russia),
China, and North Korea need to pass through these straits. If the
territorial sea were 12 nautical miles, some of the straits would
have no open sea, which means nuclear weapons would pass through
Japanese territorial waters.

The government, fearing violation of Japan's "three non-nuclear
principles," which ban the introduction of nuclear arms into
Japanese territory, therefore intentionally left some open sea,
giving priority to the passage of nuclear weapons. This has resulted
in narrower territorial waters in the straits up to this day. The
official reason given is "to promote free navigation in these
important straits," but the government is now likely to be asked to
explain.

TOKYO 00001401 004 OF 014



According to a former vice minister, during the legislation process
for the Territorial Sea Law in 1977, which designates the width of
the territorial sea to be 12 nautical miles, the handling of the
straits of Soya, Tsugaru, Osumi, and the eastern and western
channels of Tsushima Straits was discussed. It was reckoned that in
light of the secret agreement exchanged during the revision of the
Security Treaty in 1960, which acquiesced in U.S. nuclear vessels'
passage through Japanese waters, even if the territorial sea were
changed to 12 nautical miles, the U.S. government would carry
nuclear weapons on its military vessels anyway.

Therefore, it was suggested that 3-nautical mile territorial waters
be retained to leave portions of the open sea in the straits. Ships
carrying nuclear weapons would pass through the open sea portion in
the five straits, so this would allow the Japanese government to
answer in the Diet that "they are outside Japanese territorial
waters, so we have nothing to do with them." (Kyodo)

5) Showdown intensifying between U.S. government, Congress over
issue of F-22 fighter jets

NIKKEI (Page 6) (Full)
June 20, 2009

(Yukiko Deshimaru, Washington)

Antagonism is intensifying between the Department of Defense and
Congress over the issue of whether the U.S. should end the
production of the F-22 advanced stealth fighter. The Senate approved
on June 18 a supplementary budget including funds to extend the
production of the F-22. In reaction, Defense Secretary Robert Gates
expressed strong displeasure at a press conference on June 18,
remarking: "Frankly speaking, the decision is totally meaningless."
The Japanese government has put the F-22 high on the list of planes
under consideration for its next generation fighter (FX).

The F-22 is a highly priced aircraft, with one unit costing 300
million dollars, or approximately 29 billion yen (including
development expenses). Despite its cutting-edge stealth technology
to evade radar detection, the aircraft has yet to be used in actual
warfare, because no large-scale air battle has taken place in recent
military strategies, such as Afghanistan. In light of cost, Gates
decided to end orders for the F-22 fighter jet in April.

U.S. Congress members eager to maintain jobs in their electoral
districts involved in the production of the F-22 fiercely reacted to
the DOD decision. House legislators and Senators agreed to amend the
supplementary budget bill for fiscal 2009 (covering from October
2008 through September 2009) to include funds for continued
procurement and production of the F-22. The House of Representatives
and the Senate approved the extra funding on June 16 and 18,
respectively. Gates said angrily in the press conference: "The
decision runs counter to the budget policy announced by the
president."

6) U.S. House committee adopts provision seeking "study on export to
Japan" of F-22 fighter

NIKKEI (Page 5) (Full)
June 21, 2009


TOKYO 00001401 005 OF 014


The U.S. House Armed Services Committee has included a provision
seeking "study on the possibility of export to Japan" of the F-22
advanced stealth fighter in a defense budget authority bill for
fiscal 2010 (October 2009 - September 2010). Japan has been eager to
purchase the F-22 as its next-generation fighter (FX). Under U.S.
domestic law, the export of the F-22 is banned. But the amendment
provision urges the government to look into exporting the product
only to Japan.

The amendment provision, submitted by House of Representatives
member Joe Courtney (Democrat) from Connecticut, was approved by the
committee. The defense secretary is required to report on five
items, including the price of the export version and necessary legal
amendments, to Congress within 30 days after the said bill is
enacted into law. Approval in a plenary session and signature by the
president are necessary to enact the bill.

In the U.S. Congress, an increasing number of members have been
calling for continued production of the F-22, in view of job
security in their electoral districts. As part of these moves, some
members have favored approving exports of the product to U.S.
allies. The supplementary budget for fiscal 2009 (October 2008 -
September 2009) adopted by the Senate and the House of
Representatives separately as of June 18 also included a clause
approving funds for research and development of the export version
of the F-22.

Meanwhile, many U.S. government officials are cautious about
exporting the F-22, focusing on its high confidentiality. The
Defense Department's recent decision to end orders for the
high-priced F-22 fighter jet is part of the Obama administration's
economic policy of reducing the nation's fiscal deficit mainly by
shrinking defense spending. Defense Secretary Robert Gates, who is
pursuing budgetary reform in response to the President's policy, is
facing a challenge by Congress.

7) MSDF allowed to escort foreign ships

YOMIURI (Page 2) (Abridged)
June 20, 2009

The Diet has now enacted an antipiracy law, which will substantially
expand the scope of the Maritime Self-Defense Force's activities in
waters off the eastern African coast of Somalia. A squadron of MSDF
destroyers, currently deployed there, will now be allowed to escort
foreign ships as well, in addition to Japanese ships and
Japan-linked ships.

"Pirates are sea robbers, so to tell the truth, considering the
security of Japan, I'm glad that the antipiracy law has been
enacted," Prime Minister Aso told reporters yesterday at his
office.

In waters off Somalia, two MSDF destroyers are currently tasked with
convoying Japanese commercial ships and Japanese-related ships to
shuttle on an eastward- and westward-bound route of about 900
kilometers in a danger zone. The MSDF has also sent two P-3C patrol
planes for airborne warning and surveillance.

An increasing number of foreign ships are expected to ask the MSDF
for escorting, so the Defense Ministry, with an eye on the law going
into effect in late July, will study how to respond to their

TOKYO 00001401 006 OF 014


requests for escorting.

Meanwhile, the question is how long Japan will continue the
Self-Defense Forces' deployment there. Accordingly, the Defense
Ministry will also have to study an 'exit strategy.' For the time
being, the Defense Ministry plans to continue the antipiracy mission
while rotating the MSDF destroyers and P-3Cs every three or four
months. The ministry anticipates that the antipiracy mission could
be drawn out. With this possibility in mind, the ministry is also
considering such measures as withdrawing the MSDF detachment for a
certain period of time according to the local situation. In
addition, the ministry is also considering reducing the number of
MSDF destroyers out there in Somalia waters in cooperation with
those working in the Indian Ocean on a refueling mission. However,
it would be difficult to call off the antipiracy mission completely.
Aso, sitting in on June 18 before the House of Councillors Foreign
Affairs and Defense Committee, went no further than to state: "The
antipiracy mission will end if we no longer see piracy there. I will
make an overall judgment, taking into consideration the impact of
piracy on Japan's economy and public life."

8) Antipiracy law remains equivocal about weapons use

TOKYO SHIMBUN (Page 2) (Abridged)
June 20, 2009

The Diet has now enacted an antipiracy law, under which the Maritime
Self-Defense Force's antipiracy mission in waters off Somalia will
become a full-blown task with the expanded scope of authorization to
use weapons. Meanwhile, the Ministry of Land, Infrastructure,
Transport and Tourism, which is in charge of the nation's airline
and travel industries, is concerned about the possibility of
terrorism targeted at Japanese nationals if pirates are killed or
wounded.

"The military is good at looking for an excuse for opening war," a
former senior Japan Coast Guard official said. "But," he added,
"they don't want to think about what to do after the war." In the
past two years, Somali terrorist groups came under attack three
times from U.S. forces. The antipiracy mission will get bogged down
if they join hands with Islamic antigovernment insurgents for
weapons and money and if they regard foreign forces as their common
enemies.

The question is what to do if and when foreign forces attacked
pirates at their base camp in conformity with a United Nations
resolution. The government, in its Diet reply, took the position
that Japan will be engaged in the task of cracking down on crimes,
which does not fall under the use of armed force. Indeed, the
antipiracy law defines antipiracy activities as policing activities.
This logic, however, applies only in Japan.

In Somalian waters, when the MSDF repel pirate ships with its
destroyers, they use local languages to identify themselves with
loudspeakers as Japan's Maritime Self-Defense Force or Japan's navy.
Their activities appear to be military activities in the eyes of
foreigners.

Under the antipiracy law, the mission is primarily for the JCG.
However, the JCG has only one patrol ship that can be sent out. For
this reason, the government sent two MSDF destroyers. A senior
official of the land and transport ministry noted: "If the JCG takes

TOKYO 00001401 007 OF 014


the lead and is assisted by the MSDF as stipulated in the law, and
if the local situation turns into jihad, then the JCG can withdraw
with the MSDF since such a situation is off the scope of policing
activities. The MSDF is currently acting without the JCG, so it
would be difficult for the MSDF to pull out when considering its
relations with foreign naval forces there." This official insisted
that the government should review its easygoing deployment that
lacks a withdrawal plan and should have a new patrol ship built for
a rotational mission. "The JCG should take the lead," he said.

9) MSDF to send 8 destroyers overseas

TOKYO SHIMBUN (Top play) (Abridged)
June 22, 2009

The Maritime Self-Defense Force has been tasked with overseas
activities, such as escorting commercial ships in waters off Somalia
against pirates and refueling foreign naval vessels in the Indian
Ocean. In July, when the MSDF vessels currently out there will be
rotated, a total of eight MSDF destroyers will be sent abroad as
their backups, which means that the MSDF will send out half of its
destroyers that can go operational in the event of an emergency at
home. Some officials are worried about repercussions on national
defense.

The shortfall of MSDF destroyers has already affected the MSDF.
Every June, the MSDF sends two destroyers for training exercises in
the United States. This year, the MSDF cut back from two destroyers
to one for the first time. MSDF destroyers at home are heavily
burdened to back up those sent overseas.

The MSDF has sent out a total of five destroyers on overseas
missions, broken down into two destroyers on the antipiracy mission
and one each on the fueling, ocean-going, and U.S.-led training
missions. In July, the MSDF destroyers on the antipiracy and
refueling missions will be rotated. On that occasion, a total of
eight MSDF destroyers will be off the neighborhood of Japan.

The MSDF has a total of 52 destroyers. They are in established
rotation for repairs, training exercises, and missions. Accordingly,
one third of these MSDF destroyers are on direct missions. They are
indispensable for national defense but have been sent overseas.

Last December, the MSDF worked out a drastic reform plan that was
intended to dissolve "too many tasks and manpower shortages." Soon
after that, however, the MSDF's antipiracy mission started in
Somalia waters. "There's no doubt that we've been tasked with more
overseas missions," MSDF Chief of Staff Keiji Akahoshi said. We want
to ready ourselves at home (for national defense)," the MSDF's top
brass officer added.

10) List of sanctions against North Korea presented at UN

NIKKEI (Page 1) (Abridged slightly)
Evening, June 20, 2009

Akiko Sugimoto, New York

The Sanctions Committee against North Korea consisting of members of
the UN Security Council (UNSC) on June 19 held its first meeting
since the adoption of a resolution condemning North Korea's second
nuclear test. Participating countries presented their own lists of

TOKYO 00001401 008 OF 014


organizations and individual names that are suspected to be involved
in nuclear and missile developments by North Korea. Only three
organizations were subjected to sanctions imposed by the sanctions
committee after the April launch of a missile. However, it appears
that the lists presented by Japan and the U.S. this time included
more organizations and individuals, the aim being to contain
nuclear-related activities by North Korea.

The meeting brought together experts from the 15 UNSC member
nations. Each country brought a draft mentioning the names of
organizations and individuals as candidates that could be subjected
to sanctions. Japan and the U.S. appear to have proposed
incorporating the names of individuals who were not incorporated in
the final list of sanctions issued in April and including luxury
goods in the list of prohibited imports.

Meanwhile, Russia and China will likely cautiously approach the
imposition of tough sanctions on North Korea. The sanctions
committee, in principle, is not allowed to include items in a
sanctions list without the agreement of all 15 countries. It is
obligated to end the work of specifying targets of sanctions within
30 days after the adoption of the resolution on the 12th.

11) LDP eager to use MSDF in North Korea ship inspections in view of
close cooperation with U.S. military

SANKEI (Page 3) (Abridged slightly)
June 20, 2009

The Liberal Democratic Party (LDP) decided on June 20 to seek the
presentation of a special measures bill allowing both the Japan
Coast Guard (JCG) and the Maritime Self-Defense Force (MSDF) to play
main roles in inspecting ships entering and leaving North Korea in
both Japanese territorial waters and the high seas. Many countries
are engaged in naval operations, as seen in the fact that the U.S.
Navy is chasing a North Korean ship in waters near China. Given the
situation, the LDP judged that in order to swiftly share information
and work closely with the U.S. Navy, the MSDF must be used actively
from the beginning.

The government and the ruling parties plan to have their project
team come up with the legislation's framework as early as June 25.
The view is strong in the government and New Komeito that the JCG
should play the main role in ship inspections. But a LDP executive
commented, "The New Komeito has not decided not to use the SDF." The
LDP plans to propose the use of the MSDF at a project team meeting
on June 23.

If North Korea conducts another nuclear test, the UN Security
Council might adopt a stronger resolution, for instance, impose a
naval blockade. The prevailing view in the LDP is that Japan needs
legislation that will allow the government to mobilize the MSDF that
is capable of immediately responding to highly dangerous situations.
For this reason, the LDP plans to seek the presentation of special
measures legislation that specify both the JCG and MSDF as bodies to
play main roles in carryout out inspections and to urge the
government to establish a framework allowing it to make its own
decision on the two.

New Komeito Representative Akihiro Ota at a press conference on June
19 expressed his understanding to suing the MSDF, saying, "The JCG
will play the main role, but I wonder if that is sufficient in

TOKYO 00001401 009 OF 014


dealing with the situation." With many in the New Komeito holding
cautious views, whether the party will accept the LDP's decision
remains to be seen.

12) Government to submit to Diet a special measures bill to inspect
North Korean cargo; Barriers high for inspections on high seas

NIKKEI (Page 2) (Abridged slightly)
June 22, 2009

The government and the ruling parties intend to submit a special
measures bill to the current Diet session before the end of the
month that will allow Japan to inspect cargo on North Korean ships.
The legislation is designed to expand the scope of ship inspections
that is currently limited to Japan's territorial waters. But in
order to implement the envisaged legislation, three barriers need to
be cleared.

The ruling parties' special measures law project team met last
month. In the session, the government insisted that the Japan Coast
Guard (JCG) should conduct cargo inspections on the high seas, while
the Liberal Democratic Party (LDP) called for the framework of the
dispatch of the Maritime Self-Defense Force (MSDF). The meeting
failed to find a settlement line.

Questions about effectiveness of inspections

Geographical conditions are one of the reasons of cautiousness about
conducting inspections on the high seas. In many cases, North Korean
ships navigate through the Yellow Sea between China and the Korean
Peninsula. Chances are slim for them to reach the Sea of Japan via
the Tsushima Straits close to South Korea and Japanese territorial
waters. The prevailing view in the Cabinet Office responsible for
legislation is that it can hardly envisage situations where Japan
will have to conduct cargo inspections on the high seas.

At one point, it was pointed out in the ruling coalition that there
might be need for refueling of U.S. naval vessels. But according to
a senior Defense Ministry official, there has been no request from
the U.S. military for inspections of North Korean cargo or the
provision of fuel to their vessels on the high seas.

The second question is the effectiveness of ship inspections. Under
the latest UN Security Council resolution, a country conducting a
cargo inspection on the high seas needs to obtain consent from the
flag-state. But chances are slim that North Korea will agree to such
an inspection. The flag-state that refuses to give consent will then
be asked to make its ship enter a port. Again, the chances seem slim
that North Korea would comply with such a request.

The U.S. Navy has been following the North Korean cargo ship Kang
Nam since last week, suspecting it might be carrying nuclear and
missile-related materials. But it has yet to inspect the cargo. "The
purpose is to apply pressure," a senior MSDF official said.

North Korea might use ship inspections to carry out another
provocative act

There is concern in the government that the North might use ship
inspections as an excuse to carry out another provocative act,
meaning that the North might add confrontation with Japan to its
pool of bargaining chips.

TOKYO 00001401 010 OF 014



In the process of adopting the UN resolution, Japan and the United
States strongly called for ship inspections on the high seas. The
government and the ruling parties are in accord on the need for new
legislation, but the two sides are divided over specifics.

13) Government to provide yen loans to four Asian countries to
assist global warming countermeasures

TOKYO SHIMBUN (Page 2) (Full)
June 22, 2009

The government decided yesterday to offer yen loans to Bangladesh,
the Philippines, Vietnam, and Thailand under its climate change
program loan designed to support developing countries' efforts to
combat global warming. The government will decide on specific
amounts through coordination with these countries, but it eyes
several tens of billions of yen for each nation.

This is an eye-catcher in the nation's assistance plan for
developing countries' global warming countermeasures announced by
Prime Minister Taro, besides the nation's midterm target to reduce
greenhouse gas emissions. By offering loans, the government
apparently is aiming to solicit support from more developing
countries for its efforts to contain global warming prior to the
Copenhagen Conference later this year to form a new international
climate regime.

Under the program loan system, sector-specific targets will be set
and loans will be provided to support measures worked out by
developing countries. The government intends to disburse about 500
billion yen over the next five years.
14) 90 PERCENT of government-sponsored bills to clear Diet

MAINICHI (Page 2) (Full)
June 22, 2009

There is a possibility that passage of government-sponsored bills
submitted to the current Diet session will be at the 90 percent
level, which is the same as that before the Diet's upper house fell
into opposition hands. The reason is because deliberations have been
accelerated by the respective motives of the ruling and opposition
camps. The ruling parties want to chalk up achievements with an eye
on the next House of Representatives election, while the main
opposition Democratic Party of Japan (DPJ),aims to improve the
environment for an early dissolution of the Lower House.

Of the 67 government-sponsored bills, 49 have cleared the Diet. On
June 19, five bills, including the antipiracy bill, were approved,
pushing up the percentage of the passage of bills to 73.1 percent.

Of the remaining 18 bills, 10, including a formal archives bill,
have been sent to the House of Councillors. Three bills, including a
bill to revitalize local shopping areas, are expected to clear the
Lower House soon. The DPJ intends to approve these 13 bills, taking
a cooperative position of passing them during the ongoing session.
If the Lower House is not dissolved before mid-July, 92.5 percent of
the government-sponsored bills will be enacted, topping the (91.8
percent) marked at the regular session in 2007 before the divided
Diet. The government will submit to the Diet a bill on cargo
inspections (on North Korean ships) as early as late June. Even if
the bill is not passed, the percentage of the passage of bills will

TOKYO 00001401 011 OF 014


be at the 90 percent level.

In the 2008 regular Diet session under the situation with the
divided Diet, the percentage of the passage was 78.8 percent,
dropping to a level lower than 80 percent for the first time in 18
years. The reasons for the large percentage increases in the passage
of bills are because the government decreased by more than 10 bills
the number submitted to the Diet, and because the ruling coalition
flexibly responded to deliberations revising bills. Twenty bills
were revised through deliberations between the ruling and opposition
camps. In the regular session last year, 13 bills were revised
through deliberations.

One ruling camp lawmaker pointed out: "The major reason is that the
DPJ, with Lower House dissolution in mind, has not boycotted
deliberations in the extended Diet session."

15) DPJ alarmed about possible tidal change in political situation
as result of trial on Nishimatsu Construction president

YOMIURI (Page 4) (Abridged slightly)
June 20, 2009

The first trial on illegal political donations to the political
support office of Ichiro Ozawa, now deputy president of the
Democratic Party of Japan, made by Nishimatsu Construction Co. was
held on June 19 at the Tokyo District Court. With the office's
involvement in bid-rigging practices being pointed out in detail,
many DPJ members now have a heightened sense of alarm that this
could affect the next Lower House election.

A mid-ranking lawmaker, who distances himself from Ozawa said with
his face darkening: "The points made at the trial appear to be
different from Mr. Ozawa's explanations. He had said that the
sources of donations will not be delved into. If it is proved that
his explanations were false, the tide could turn in the run-up to
the Lower House election."

Upper House Diet Affairs Committee Chairman Susumu Yanase told a
press conference, "Mr. Ozawa stepped down as president. This is a
very serious way of taking responsibility as politician. The
validation of the evidence by a third party committee is already
over. The trial will not have an impact as a whole."

Supreme advisor Kozo Watanabe also told reporters: "Voices hoping
that the DPJ will take the reins of government are gaining ground.
This issue will not change the trend at all."

Some lawmakers critical of Ozawa take the view that since the new
leadership is going well, having a renewed internal power struggle
should be avoided. A certain party executive, who has distanced
himself from Ozawa, said on the 19th, "I will make no comment. That
is for the sake of the party. The storm will recede, while we remain
silent."

The Social Democratic Party (SDP) and the People's New Party (PNP)
are showing a certain level of understanding to such a stance of the
DPJ. However, they are concerned with SDP Secretary General Shigeno
noting, "If what have been pointed out at the trial is true, it
would be a serious problem," or PNP Secretary General Hisaoki Kamei
saying, "One cannot say that the trial will have no political impact
at all."

TOKYO 00001401 012 OF 014



The ruling parties want to heighten interest in the incident, by
strengthening an attack on the DPJ, and bring about a rollback.

Liberal Democratic Party (LDP) Secretary General of the Upper House
Tanigawa underscored during a press conference: "We must make Mr.
Ozawa feel great responsibility." New Komeito Secretary General
Kitagawa at the party's meeting of lawmakers pointed out: "Mr. Ozawa
should give a proper explanation. The DPJ's self-cleansing
capability is being called into question.

16) 2009 Tokyo assembly election: LDP candidates distancing
themselves from Aso

YOMIURI (Page 38) (Full)
June 22, 2009

Prior to the Tokyo Metropolitan Assembly election, the run-up to the
next House of Representatives election, the Yomiuri Shimbun
conducted a survey of candidates running in the race in the form of
a questionnaire. One of the questions was who would be the most
suitable politician for prime minister. Of the 58 candidates backed
by the Liberal Democratic Party (LDP),only 27 (47 percent) said
Prime Minister Taro Aso, while 83 percent of the Democratic Party of
Japan's (DPJ) candidates said DPJ President Yukio Hatoyama. The
figures show that the LDP candidates for the Tokyo election also are
distancing themselves from Aso although he has taken a stance of
placing importance on the election by visiting the campaign offices
of the candidates.

The survey was conducted on the 210 candidates from June 10, asking
seven questions such as their campaign issues and the low cabinet
support rates. As of June 21, 206 persons replied to the
questionnaires.

Although all the 58 LDP candidates supported the Aso cabinet, less
than 50 percent of them preferred Aso as prime minister, while 8
persons preferred Nobuteru Ishihara, LDP senior deputy secretary
general.

Three candidates each said they think Kaoru Yosano, finance
Minister, state minister for financial services, and state minister
for economic and fiscal policy, and former Defense Minister Yuriko
Koike, are the most suitable politicians for prime minister. Two
candidates preferred Tokyo Governor Shintaro Ishihara. Eleven
candidates did not reply to the question.

Of the 53 DPJ candidates, 44 said Hatoyama, three each preferred
Deputy President Naoto Kan and Secretary General Katsuya Okada, and
one said House of Councillors member Renho. Four candidates did not
mention any politician.

Also in the Yomiuri poll (conducted on June 13-14),in which the
approval rate for the Aso cabinet was 22.9 percent, candidates
expressed strong dissatisfaction with Aso. Of the 20 candidates, who
mentioned the name of other politician than Aso as most suitable for
prime minister, one Tokyo Metropolitan Assembly member said:

"It has now clarified that Prime Minister Aso lacks leadership due
to the dismissal of Internal Affairs and Communications Minister
Kunio Hatoyama. With this, the adverse wind has become stronger."


TOKYO 00001401 013 OF 014


A first-time candidate said: "The Prime Minister has often changed
his decisions."

Another Tokyo assembly member, who wrote Prime Minister Aso as most
suitable, said: "I wrote his name from a sense of duty as he came to
my office to encaurage me. So, I was unable to write the name of
other politician."

A new candidate, who had wrote down the name of Nobuteru Ishihara,
said: "He is young and fresh. I can leave the party's reform to
him." A Tokyo assembly member, who wrote the name of Kaoru Yosano,
said: "His fiscal policy is good. He has replied to questions at the
Diet in a good manner."

17) Economy is declining... but people are happy: Poll by Cabinet
Office finds increasing number of respondents concerned about old
age

SANKEI (Page 2) (Full)
June 20, 2009

The Cabinet Office on June 19 summed up the results of a survey of
preferences in people's lives for fiscal 2008. The survey found that
the prevailing public consciousness is that although their lives
have become difficult in economic terms, following the economic
recession they are fulfilled but have concerns about their old age.
While nearly 90 PERCENT of respondents feel that their living
standards have deteriorated, more than 50 PERCENT are satisfied
with their lives as a whole. The survey highlighted the dignity of
average persons who feel modestly happy, even when the economy is on
the decline.

According to the poll, to a question whether they think their living
standards are getting better, 10.3 PERCENT , down 50 PERCENT from
the previous poll, replied that their lives have improved. The
figure is the lowest-ever since the survey started in 1978. The
downtrend that kicked in in 1990 during the economic bubble era has
thus accelerated.

Respondents who feel that their lives are deteriorating reached 89.5
PERCENT , underscoring the present situation, in which the economic
crunch is hitting the lives of the people.

In the meantime, to a question whether respondents are satisfied
with their lives in general, 55.9 PERCENT said that they are
satisfied, up 16.5 points from three years ago. Respondents who are
married with children and those with single-family homes have
contributed to pushing up the percentage, according to the Cabinet
Office. A survey of fulfillment, which asked respondents what they
are satisfied with, endorsed that. Among 60 kinds of fulfillment,
the highest number of pollees cited that they have conversations
between parents and children and that they trust one another.

The percentage of pollees who replied that have bright prospects for
their lives in old age is gradually declining. The lowest-ever 11.8
PERCENT replied that their outlook for old age is bright, while
87.9 PERCENT replied otherwise, saying that they did not think so.
Savings per household are dropping due to a drop in income in the
wake of the recession, which appears to be fanning anxieties over
future pension payouts.

The survey was conducted on persons aged between 15 and 75

TOKYO 00001401 014 OF 014


throughout the nation between January and February this year.
Replies were received from about 4,500 men and women.

ZUMWALT