DAILY SUMMARY OF JAPANESE PRESS 07/22/09

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SUBJECT: DAILY SUMMARY OF JAPANESE PRESS 07/22/09

INDEX:

(1) Simulation of post-election scenarios: Who will have the
majority of seats in the Lower House? (Tokyo Shimbun)

(3) Government framework in limbo: Independents hold the key; major
realignment possible (Nikkei)

(2) Business leaders unofficially contacting DPJ members (Tokyo
Shimbun)

(3) Unusually long 40-day election campaign effectively kicks off
(Nikkei)

(4) DPJ's aim to break away from bureaucratic control, while moving
to Kantei-led budget compilation system could be source of trouble
(Nikkei)

(5) Interview with former prime minister Nakasone: DPJ getting boost
with people becoming tired of LDP (Yomiuri)

(6) "Seiron" column: The price of a rare "success story" in the
world (Sankei)

(7) Okinawa government has no point of contact with DPJ, worried
about going back to square one on USFJ realignment (Ryukyu Shimpo)

(8) DPJ "retreating" to pragmatic line on USFJ realignment? Need to
watch its manifesto (Ryukyu Shimpo)

(9) Interview with five economists on post-election economic policy:
Clarification of fiscal resources essential (Tokyo Shimbun)

(10) Poll on Aso cabinet, political parties (Mainichi)

(11) Poll: Aso cabinet, political parties, election for House of
Representatives (Asahi)

(Corrected copy): Tearful prime minister expresses "remorse" at
meeting of LDP Diet members; Humble attitude suppresses discontent
(Tokyo Shimbun)

(12) Political Cartoon (Sankei)

ARTICLES:

(1) Simulation of post-election scenarios: Who will have the
majority of seats in the Lower House?

TOKYO SHIMBUN (page 3) (Full)
July 22, 2009

House of Representatives Election Reporting Team, Political News
Section

Will the ruling parties, the Liberal Democratic Party (LDP) and New
Komeito retain control of the administration, or will the opposition
parties led by the Democratic Party of Japan (DPJ) achieve a change
of government? The battle for the House of Representatives election,
through which voters will choose the next administration, has begun.
What will the political framework look like after the election
results come out on August 30, after the 40-day campaign period? We

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made a simulation.

(1) Continuation of the LDP-New Komeito government: Continuation of
"twisted Diet," turmoil in the legislature

The Lower House has 480 seats, and the parties that end up with at
least 241 seats will have the support of the popular will and
preside over the administration.

If the LDP and New Komeito win a majority of seats, the current
government framework will be sustained. However, it is definitely
impossible for these two parties to retain over two-thirds of the
Lower House seats, which they had won in the last election. The
"twisted Diet," where the opposition controls the House of
Councillors, will continue but the ruling parties will no longer
have the option of passing bills with a second vote in the Lower
House, their trump card in the legislation process. Therefore, they
will have a tougher time steering the government. Above all, a
turbulent Diet will continue.

(2) DPJ-led administration: Policy differences source of trouble in
coalition government

If the opposition forces led by the DPJ win a majority of seats,
this will mean the birth of the first non-LDP administration since

1993.

At present, the DPJ has won successive victories in major local
elections. It also enjoys a comfortable lead over the LDP in
political party support ratings. A change of administration is fast
becoming a real possibility.

A change of government will be possible, of course, if the DPJ wins
a majority single-handedly. Even if it fails to do so, if the DPJ,
along with the Social Democratic Party (SDP) and the People's New
Party (PNP),manages to control a majority, a changeover will be
highly possible.

If a coalition government is formed by the DPJ with the SDP and the
PNP, there will no longer be a "twisted Diet," since they also
control the Upper House. These parties will have the initiative in
steering the Diet.

However, there is a big gap between the SDP and the DPJ on such
issues as the Constitution and security policy. SDP leader Mizuho
Fukushima is taking a wait-and-see attitude on the DPJ, saying, "We
will give positive consideration to joining a coalition but have not
yet decided." The two parties are expected to clash on policies.

However, in this case, Diet members of the LDP, which is now an
opposition party, may leave the party and become a "supplementary
force" joining the non-LDP coalition. A realignment of political
forces with the DPJ at the core on a small or medium scale may take
place continuously.

(3) Government framework in limbo: Independents hold the key; major
realignment possible

The most troublesome scenario after the Lower House election is that
both the LDP-New Komeito camp and the DPJ-led forces fail to control
a majority, each winning 220-230 seats, resulting in failure to
determine the framework of the administration.

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In such a case, with the exception of the Japanese Communist Party,
which opts for a unique line, the moves of independent groups, such
as those led by former Minister of Economy, Trade, and Industry
Takeo Hiranuma and former Administrative Reform Minister Yoshimi
Watanabe, will hold the key. Both the LDP-New Komeito camp, which
wants to hold on to power, and the DPJ, which wants to gain power,
will undoubtedly compete fiercely to recruit defectors.

If they still fail to control a majority, the LDP and the DPJ will
even work vigorously to win over defectors from the other side. The
LDP, in particular, has shown signs of internal division since last
week, pointing to the potential for disintegrating after the
election.

However, in such a case, the number one party is still likely to
have the initiative in the realignment of political forces.

On the other hand, there is also the possibility of moves toward a
grand coalition between the LDP and the DPJ. This idea had emerged
once during the Fukuda administration. Then DPJ President Ichiro
Ozawa was positive about it, but Ozawa has resigned as president.
Current President Yukio Hatoyama is said to be negative about such a
coalition, so the probability is not high.

Additionally, the election of the prime minister may take place with
both the LDP-New Komeito camp and the DPJ-led forces failing to
control a majority. In this case, the candidate winning the most
number of votes will take over the administration. This will be a
minority government from the beginning and is bound to face serious
difficulties in steering the government.

(2) Business leaders unofficially contacting DPJ members

TOKYO SHIMBUN (Page 8) (Full)
July 22, 2009

Nippon Keidanren (Japan Business Federation) Chairman Fujio Mitarai
yesterday indicated his expectations for lively debates to be
conducted during election campaigning, remarking: "Since this is an
important election that will determine the fate of Japan, I expect
political parties to engage in animated policy debate and then have
the people make a judgment." Asked for his view about the
possibility of a change of government, Mitarai only replied: "I want
you to wait until 40 days from now (the voting day)." Japan
Association of Corporate Executives President Masamitsu Sakurai
emphasized: "Our nation is in austere fiscal conditions. It (the
general election) will be a historic election to choose a government
to build a new nation."

Japan Chamber of Commerce and Industry (JCCI) Chairman Tadashi
Okamura issued this statement: "The major point of issue is what
scenario will be laid out for the future."

Business leaders are taking a wait-and-see attitude for the upcoming
election. But Keidanren and JCCI have reportedly made contact with
Democratic Party (DPJ) members behind the scenes for such reasons as
asking the party to reflect their requests in its policy manifesto.

(3) Unusually long 40-day election campaign effectively kicks off

NIKKEI (Page 2) (Abridged slightly)

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July 22, 2009

A campaign lasting 40 days and culminating on Aug. 30 -- the longest
under the current Constitution -- has effectively kicked off, in the
run-up to the Aug. 30 House of Representatives election. Although
the Liberal Democratic Party (LDP) has set the victory-or-defeat
line at a majority, uncertainties remain in the party about Prime
Minister Taro Aso's ability as head of the party. The LDP is likely
to face an uphill battle. Meanwhile, the major opposition Democratic
Party of Japan (DPJ),which regards the upcoming election as a
once-in-a-million chance to take over the reins of government, is
hurriedly making adjustments to field candidates in all
constituencies while urging its members to remain vigilant
throughout the campaign despite the momentum the party is gaining.

LDP plays up party unity at eleventh hour

& Handshake with Nakagawa

"We have no other option but to come together during the election
campaign," Prime Minister Aso said at an informal meeting of LDP
lawmakers of both houses of the Diet that was held around yesterday
noon. The Prime Minister also acknowledged and apologized that his
inconsistent remarks and a lack of leadership have contributed to
dwindling support ratings. A sense of relief descended upon the
conference room as tears welled up in Aso's eyes in the end. One
member said, "It was surprising that the Prime Minister, who takes
great pride in himself, offered an apology."

The informal meeting was immediately followed by a meeting of LDP
Lower House lawmakers in which former Secretary General Hidenao
Nakagawa, a major member of the anti-Aso wing of the party, said:
"(Hearing Prime Minister Aso's remarks),I am now totally willing to
accept his decision." Nakagawa then exchanged a firm handshake with
Aso, drawing a round of applause from the others in the room.

The anti-Aso group's effort to play up party unity is also
attributable to its resignation of the unseat Aso drive and
supporters' discontent with the mess in the party. Former Prime
Minister Yoshiro Mori complained during the Machimura faction's
campaign kick-off ceremony yesterday afternoon, saying, "Some are
still bad-mouthing the Prime Minister and the party on television."
Nakagawa, who attended the faction's meeting for the first time in
about five months, left the room after saying only a few words.

& Little demand for Aso's stump

The Prime Minister handed the party's official endorsement
certificates to the first group of 309 prospective candidates
(including proxies) at LDP headquarters yesterday afternoon. But
questions are still hanging over the Prime Minister's qualifications
as the "face of the party" for the upcoming election. Many LDP
members take sober views of Aso, with one junior LDP lawmaker
saying, "His stump would be counterproductive."

The faction led by former Secretary General Taku Yamasaki held a
meeting around yesterday noon in which Yamasaki called for steady
efforts to win votes, saying: "If we joint efforts with the New
Komeito, we can win the upcoming election. You must win seats at all
costs."

DPJ warns its members about being complacent

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& Person connected with Gunma 4th district may challenge former
Prime Minister Fukuda

At a press conference yesterday, DPJ President Yukio Hatoyama
revealed a plan to reach conclusions before the end of the week on
the constituencies the DPJ has yet to determine its candidates.
Deputy President Ichiro Ozawa plans to run in Iwate Constituency No.
4 as before instead of the Tokyo 12th district, which is New Komeito
Representative Akihiro Ota's home constituency. Meanwhile, the New
Party Nippon officially decided yesterday to field its head, Yasuo
Tanaka who is an Upper House member, for the Hyogo 8th district. The
DPJ is likely to endorse him.

The DPJ has yet to determine its candidates in nine constituencies.
The party has postponed determining a candidate for the Gunma 4th
district, the home turn for former Prime Minister Yasuo Fukuda. A
group of people connected with the 4th district, including one eager
to announce his candidacy, met with Ozawa yesterday. The DPJ is also
looking for its own candidate for Kanagawa Constituency No. 8 where
Kenji Eda, an independent, will run in.

The largest opposition party also intends to significantly increase
the number of candidates running only in the proportional
representation segment. In the past, the DPJ had only one candidate
for each block. In the upcoming election, the party is considering
fielding several candidates for the blocks from Hokkaido to Kinki.
DPJ executives, including Hatoyama and Ozawa, dined with Kyocera
Honorary Chairman Kazuo Inamori in Tokyo last night. They are
believed to have exchanged views on the Lower House election
situation and other matters.

& Moves to change hats

Some DPJ lawmakers are considering changing their hats. Shadow
cabinet defense minister Keiichiro Asao, an Upper House member,
informed Ozawa yesterday of his plan to run in the Kanagawa 4th
district. Asao is considering all possibilities, including running
in the race as an independent.

The 40-day marathon campaigning is associated with many concerns.
DPJ President Hatoyama is saddle with the question of false
political fund reports. Hatoyama has indicated at a press conference
that there is no need to hold another news conference to offer
additional explanations, saying: "There may be people who do not
think I have fulfilled my accountability, but there are far more
people who want to see the DPJ bring change to politics."

(4) DPJ's aim to break away from bureaucratic control, while moving
to Kantei-led budget compilation system could be source of trouble

NIKKEI (Page 5) (Abridged)
July 22, 2009

One issue in the House of Representatives election is how fiscal
policy, including the national budget, will be affected. The
Democratic Party of Japan (DPJ) advocates breaking away from a
"bureaucracy-led budget compilation" process, and the party is
contemplating the creation of a new "national strategy bureau"
reporting directly to the prime minister. This bureau would take
charge of drafting the budget outline. Since this will represent a
major shift from the current modus operandi, the Liberal Democratic

TOKYO 00001659 006 OF 020


Party (LDP) and officials of the central government at Kasumigaseki
see it as unrealistic. If a change of administration occurs, the
process of compiling the budget that will start immediately is
certain to run into trouble.

The government and the ruling parties have approved the budget
request ceilings, which serve as the outline of the fiscal 2010
budget, on July 1, setting the upper limit of general appropriations
for policy expenditures at a record 52.7 trillion yen. Each ministry
will now submit their budget requests based on these ceilings to the
Ministry of Finance (MOF) by August 31.

If the framework of the administration does not change drastically
after the Lower House election, MOF will start examining the
ministries' budget requests from September as it usually does. After
negotiations with the ruling parties on such key issues as revisions
to medical fees, the government's version of the budget will be
compiled by late December, the aim being to have it pass the Diet by
the end of March 2010.

However, if the DPJ takes over the reins of government, the
timetable inevitably would undergo a major change. The DPJ is even
calling for a drastic reform of the ceilings, calling them the
symbol of "MOF-led budget compilation."

Until now, budget compilation consisted mainly of adding up the
various budget requests submitted by the ministries to MOF and
deciding on the final budget for the entire government through
ruling-party negotiations. However, the DPJ has proposed a reform
that would have the Prime Minister's Official Residence (Kantei)
take the lead in setting the budget outline. This outline would
determine the budget allocation for each ministry. Since the Kantei
will lead the process of deciding the outline of the budget, the
creation of a national strategy directly under the prime minister is
also being considered.

However, it will not be easy to change the schedule for budget
compilation overnight. There is growing concern in Kasumigaseki,
with one senior economic official noting, "If they push for this
arbitrarily, trouble will inevitably come." One senior MOF official
also expressed concern, "It is absolutely impossible to predict what
would happen to the budget process after a change of
administration."

(5) Interview with former prime minister Nakasone: DPJ getting boost
with people becoming tired of LDP

YOMIURI (Page 4) (Full)
July 18, 2009

-- How do you see the present situation of the Liberal Democratic
Party (LDP)?

"I have the impression they are squabbling while the ship is
sinking. Issues connected with a presidential election have an
aspect of being a kind of power struggle, but there needs to be some
kind of objective or order as to what the fight is all about. The
forces that are trying to oust Prime Minister Aso do not have the
next card (a presidential candidate). They are fighting for the sake
of fighting. The LDP exists for the sake of the state and the
people. If politicians engage in a scramble in pursuit of intraparty
rivalry, the LDP will be diminished. They should see a bigger

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picture with an eye on public sentiment and the eyes of the people.
Replacing the prime minister at this point of time will not appeal
to the people. The LDP's loss in the Tokyo Metropolitan Assembly
election indicates that people are fed up with the long-term
administration of the LDP, that a new wind is blowing, and that the
Democratic Party of Japan (DPJ) is riding on that wind. This wind
will continue to blow for some time to come. I cannot but think that
the LDP will have an uphill battle in the forthcoming Lower House
election. The LDP must come up with something that will ease the
public's discontent."

-- Public support ratings for Prime Minister Aso are low.

"He acts in a way that makes people think he is frivolous in his
remarks and lacks consideration. He is viewed as a political
lightweight. He must show them that he is a political heavyweight,
overcoming the fact that he is still serving in his first term (past
10 months) in the run-up to the Lower House selection."

-- Prime Minister Aso has continued to delay Lower House
dissolution.

"A situation like that was unprecedented. This is an issue of a
politician's ability to make a decision. There have been many
precedents in which the Lower House was dissolved under a
disadvantageous situation in order to break a deadlock. Diet
dissolution unites public sentiments, as well as moves in the party
and among fellow party members. As such, all Diet dissolutions
involve strains. There are few Diet dissolutions free of strains.
Politicians need guts and insight to carry out dissolutions.

Past prime ministers were elected with the solid backing of fellow
party members and aides. When they made political decisions, they
tapped that solidarity. I carried out the so-called "feigned-death"
Diet dissolution in 1986. My fellow party members knew about it.
However, they gladly pretended to be unaware of my intention.
Politicians now do not make such an approach. Human bonds have now
become very thin and weak."

-- How do you view DPJ President Hatoyama?

"He has gained in breadth and taken on an added significance. Since
he now knows the path to taking over the reins of government to some
extent, he has room to breathe. However, his approach to the issue
of the false statement of individual political fund donations in his
political fund report was insufficient. He needs to deal with the
matter promptly. It is also imperative for him to have foreign
affairs experts near him. He must bear in mind the need to pursue a
mature diplomacy.

The DPJ has yet to give full accounts on public finances, education
and agricultural administration on the domestic front, and foreign
affairs and security policies as well. He should solidify relations
with China, South Korea and Association of Southeast Asian Nations
(ASEAN),as well as to reveal policies toward the U.S., European
countries and Russia.

-- What about the possibility of a political realignment after the
Lower House election?

"There is a great possibility of such realignment. Moves to create a
stable axis, based on public opinions during election campaigns and

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public responses to election results, will presumably appear when a
new administration is established. Minority forces from both the LDP
and the DPJ might bolt their parties. Such could occur if political
circles undergo realignment."

(6) "Seiron" column: The price of a rare "success story" in the
world

SANKEI (Page 7) (Full)
July 22, 2009

Ryozo Kato, former ambassador to the U.S., Nippon Professional
Baseball commissioner

Threat facing democracies

The late Dr. Herman Kahn once noted, "Democracies are susceptible to
two dangers; one is aggression from outside, the other is erosion
from inside." After returning home from the United States last year,
I realized that one of the dangers, "erosion from inside" is
permeating Japan.

First, a sense of community and caring for each other has weakened
among Japanese. And in inverse proportion to this, there are too
many individuals who intimidate others with their complaints and
criticisms. I think the mass media, particularly television, are
largely responsible for this.

To borrow the words of one American, the mission of the media is no
longer to provide "information"; the media have turned into a world
of "infortainment." Just like "junk food," both the providers and
the consumers are unable to stop themselves, even though they know
it is bad for the health.

Even in news broadcasting, there is an excess of half-baked "live
reports" for everything. These reports are made in bad Japanese,
often with unclear context. While claiming to be "factual reports,"
the person talking on the screen throws in his subjective views,
trying to "guide" public opinion and deriving pleasure from doing
this. While I am not surprised by this situation in the media, I
think this tendency is very childish.

Japan insensitive to the outside world

Another problem is the sloppiness of information management in
Japan.

With regard to information, the United States probably thinks that
China makes more sense than Japan. Overall, Japan does not realize
that everything it does is being watched by the outside world. It is
too used to "following the crowd" and is insensitive to people
looking from outside the country.

Perhaps for this reason, or as a result, Japan worries too much
about the wishes of the concerned countries when it comes to
security and defense policy. I think this weak sense of community
and sloppiness in information management is related to Japan's
isolating itself from war, even though 64 years have passed since
World War II.

The United States is in stark contrast to Japan.


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I believe that the election of President Barack Obama is not
unrelated to the fact that the U.S. has been involved with all the
major wars since World War I. War is the harshest experience. The
American people have had to share such experience for a prolonged
period of time.

I will not go into the right or wrong or good or bad of war.
However, sharing the war experience unmistakably lowers the racial
or gender barrier. There is something common in the rise of Tiger
Woods and Barack Obama, albeit in very different fields.

On the other hand, Japan became a rare "success story" through its
"insulation from war" after World War II. However, the price for
this has come to take the form of lack of sense of community and
insensitivity to information.

Since there is a weak sense of caring for each other even among the
Japanese people, it is natural that Japan also has a weak sense of
community with its allies and the outside world and is insensitive
to information that needs to be shared with them.

During my tour in the U.S., visitors often asked me which is more
important for the U.S., Japan or China. I think this is more a
question of "Japan's choice" than a question of "the United States'
choice." While Japan and the U.S. are allies, such is not the case
between the U.S. and China. Therefore, it boils down to the simple
matter of since Japan is an ally of the United States, it should
behave like one.

Mutual defense is the essence of an alliance

There have been some discussions about whether Japan can intercept a
missile fired by North Korea heading for the U.S. The essence of an
alliance is "mutual defense," and a response disregarding this is
certain to have an impact on mutual trust, which is the bedrock of
the alliance. The concepts of "soft power" and "smart power" were
discussed enthusiastically at a seminar on Japan-U.S. relations that
I attended recently.

The Americans on the panel emphasized that whether it is "soft,"
"hard," or "smart" power, the common essence is "power." Without
"power," "soft" or "smart" is meaningless. At the end of the day,
they are all means to achieve a specific goal.

Japan likes "soft power." Essentially, the wish or belief behind
this is that the risk of loss of Japanese life as a result of the
implementation of Japanese policy should be avoided by all means.

To protect one's own safety, one always needs to share a sense of
community and share information and risks with others. The same is
also completely true for the international community. Even today,
Japan still aspires to be more important than China and to be
regarded as an indispensable ally of the United States, having a "no
risk, high return" mindset.

There is a serious contradiction in this. Japan is barely aware that
there has to be a meeting point between these two aspects. I think
that therein lies the inevitable "choice" that Japan will have to
make.

(7) Okinawa government has no point of contact with DPJ, worried
about going back to square one on USFJ realignment

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RYUKYU SHIMPO (Page 2) (Full)
July 22, 2009

In light of the possibility that a Democratic Party of Japan (DPJ)
administration might be launched, officials of the Okinawa
Prefectural Government (OPG) are beginning to be worried about the
lack of points of contact with the party. One senior OPG official is
visibly anxious that, "We do not know whom to talk to," since the
debate on security policy in the DPJ has been inconclusive. He also
gives the following analysis: "One of the points of contention in
this general election is which party will promote decentralization
of power more," and with the examination of Okinawa's economic
development program taking place, "the question is not what the
national government will do for us, but our vision of what we want
to do and what sort of assistance we can obtain." He emphasizes that
he is closely watching the decentralization policy.

On the impact of the election on USFJ realignment, the senior OPG
official stated: "The environmental assessment procedures are
underway" for the relocation of Futenma Air Station. He said that he
would be watching how the current relocation plan proceeds, adding,
"We are indeed anxious about what will happen to the political
situation and whether there will be an alternative plan to replace
the existing agreement. Even if such a plan is presented, it will be
a problem because the plan to complete the replacement facility by
2014 will come to nothing." He appears to be alarmed that while the
DPJ advocates relocation outside Okinawa, there is no guarantee such
a proposal would ever be pursued.

Regarding the fiscal 2010 budget requests due by the end of August,
another senior OPG official said: "The budget request guidelines
have already come out. There will probably be no significant change
in the allocations for Okinawa's development."

(8) DPJ "retreating" to pragmatic line on USFJ realignment? Need to
watch its manifesto

RYUKYU SHIMPO (page 2) (Full)
July 22, 2009

Tokyo - Choosing a new administration is the main theme in the
forthcoming House of Representatives election. With regard to U.S.
Forces Japan (USFJ) realignment, senior officials of the Democratic
Party of Japan (DPJ),which is aiming to become the ruling party,
have often talked about the relocation of Futenma Air Station
outside Okinawa in their news conferences and speeches to highlight
the party's difference with the current administration. However,
when it comes to specific plans, such as the choice of a relocation
site, the party has remained vague.

On the other hand, the ruling Liberal Democratic Party (LDP)
maintains its position of promoting the realignment plans, asserting
that the steady implementation of the project to relocate the
Futenma base to waters off Henoko in Nago City will contribute to
lightening the burden imposed by U.S. bases on Okinawa.

When DPJ President Yukio Hatoyama was in Okinawa on July 19, he
reiterated his party's goal of relocating the Futenma base out of
Okinawa. He said: "If the Okinawan people are united in their wish
for relocation outside the prefecture, we will also have to take
positive action to at least move this facility outside Okinawa

TOKYO 00001659 011 OF 020


(short of moving it outside Japan)."

However, a senior Ministry of Defense official regards this as the
DPJ's shift to a pragmatic line. He points out: "The statement about
'if the Okinawan people are united in their wish' was made with full
awareness of the current situation in which Okinawans are divided
between relocation outside Okinawa and relocation within Okinawa (to
Nago). He knew that it is impossible for the Okinawans to reach a
consensus."

The agreement on the relocation of U.S. Marines in Okinawa to Guam
was approved in May. On July 11, the first installment of relocation
funds since the agreement took effect was provided by Japan to the
United States. With the USFJ realignment road map agreed upon by the
two governments being executed steadily, what sort of review of the
realignment plans does the DPJ have in mind? The party's manifesto
(campaign pledges) to be issued by the end of July will be carefully
watched.

(9) Interview with five economists on post-election economic policy:
Clarification of fiscal resources essential

TOKYO SHIMBUN (Page 8) (Full)
July 22, 2009

The next general election has been set for August 30, opening a
battle between the Liberal Democratic Party (LDP) and the Democratic
Party of Japan (DPJ) to capture the reins of government. Market
players are eager to figure out what economic and fiscal policies
might be taken after the election. The Tokyo Shimbun asked five
economists about what economic issues are expected to take center
stage in the campaign and prospects for the stock market.

The upcoming election will take place in the aftermath of the
financial crisis that was set in across the world last fall and the
subsequent economic deterioration. Nikko Cordial Securities Inc.
senior economist Jun Tsukasa made a sarcastic comment about Prime
Minister Taro Aso, who was pressed to dissolve the House of
Representatives under severe circumstances although no prospects are
in sight for economic recovery, dubbing the dissolution as "KY
(Keizai = economy, Yokuwakaranai = incomprehensive) dissolution."
Dai-Ichi Life Research Institute Inc. chief economist Yoshikiyo
Shimamine called it "a once-in-a-century dissolution." They take the
view that economic stimulus measures are likely to take center stage
in the election campaign, given the current unprecedentedly serious
depression.

The five economists share the view that a certain level of fiscal
disbursements are necessary in order to turn around the economy, but
Credit Suisse Securities chief market strategist Shinichi Ichikawa
commented: "It is essential to clarify where the necessary revenues
will come from."

Paying attention to depopulation getting more serious and increasing
welfare spending, JP Morgan Securities chief economist Masaaki
Sugano says: "It is necessary to consider how tax hikes, economic
growth, and dependence on debts (issuance of government bonds)
should be balanced out" (to cover social security spending).

Regarding the possibility of the election producing a change of
government, the five economists all gave it more than a 50 PERCENT
chance. Mizuho Research Institute senior economist Koji Takeuchi

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said: "At the present point of time, it is highly likely that with
the dissatisfaction at the LDP and the Aso cabinet alone, a switch
in power between the ruling and opposition camps could occur." He
stressed the need for all political parties to engage in
policy-oriented election campaigning.

Asked about the future of the stock market, the five economists
predicted that the 225-issue Nikkei Stock Average would exceed the
10,000 line by the end of this fiscal year.

As factors to bring up stock prices, Tsukasa cited: "Earnings of
domestic firms should hit bottom," and Ichikawa listed "the need of
economic recovery in the U.S. and other foreign countries." Sugano
said: "Unless Japan presents its medium- to long-term vision,
foreign investors will not buy Japanese stocks."

Naming of the dissolution; key economic issues Possibility of
change of government
Jun Tsukasa "KY dissolution;" tax hikes or elimination of waste
spending to squeeze out financial resources. 95 PERCENT
Shinichi Ichikawa "Economic structure-selection election"; propriety
of the DPJ's policies that require enormous funds and specific
financial sources. More than 90 PERCENT
Koji Takeuchi "Election for the people's livelihoods;" to what
extend fiscal disbursements should be approved. 70 PERCENT
Masaaki Sugano "Election to propose pork-barrel measures;" which
should be chosen to finance social security spending, tax hikes,
economic growth or dependence on debts. 70 PERCENT
Yoshikiyo Shimamine "Once-in-a-century dissolution;" when the effect
of the current economic stimulus measures disappear, what additional
measures should be taken. 50 PERCENT

(09072205ys) Back to Top

(10) Poll on Aso cabinet, political parties

MAINICHI (Page 2) (Abridged)
July 20, 2009

Questions & Answers
(T = total; P = previous; M = male; F = female)

Q: Do you support the Aso cabinet?

T P M F
Yes 17 (19) 16 17
No 67 (60) 70 64
Not interested 16 (20) 13 19

Q: (Only for those who answered "yes" to the above question) Why?

T P M F
Because the prime minister is from the Liberal Democratic Party 34
(42) 30 39
Because something can be expected of the prime minister's leadership
12 (11) 14 10
Because there's something familiar about the prime minister 24 (22)
22 25
Because something can be expected of the prime minister's policy
measures 25 (19) 31 19

Q: (Only for those who answered "no" to the above question) Why?

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T P M F
Because the prime minister is from the Liberal Democratic Party 8
(8) 10 7
Because nothing can be expected of the prime minister's leadership
39 (39) 36 41
Because there's something imprudent about the prime minister 15 (17)
13 17
Because nothing can be expected of the prime minister's policy
measures 36 (35) 37 35

Q: Which political party do you support?

T P M F
Liberal Democratic Party (LDP) 18 (20) 19 17
Democratic Party of Japan (DPJ or Minshuto) 36 (34) 43 30
New Komeito (NK) 5 (4) 3 6
Japanese Communist Party (JCP) 4 (4) 4 3
Social Democratic Party (SDP or Shaminto) 1 (1) 0 1
People's New Party (PNP or Kokumin Shinto) 1 (0) 0 1
Reform Club (RC or Kaikaku Kurabu) -- (--) -- --
New Party Nippon (NPN or Shinto Nippon) 0 (--) 1 --
Other political parties 2 (1) 3 2
None 32 (32) 26 38

Q: Who do you think is more appropriate for prime minister, Prime
Minister Aso or DPJ President Hatoyama?

T P M F
Prime Minister Aso 11 (15) 12 10
DPJ President Hatoyama 28 (32) 34 22
Neither 57 (46) 53 62

Q: Which party, the LDP or the DPJ, would you like to see win in the
next election for the House of Representatives?

T P M F
LDP 23 (27) 22 24
DPJ 56 (53) 63 51
Other political parties 16 (12) 13 19


Q: If an election were to be held now for the House of
Representatives, which political party will you vote for in your
proportional representation bloc?

T P M F
LDP 18 19 17
DPJ 45 54 36
NK 6 5 7
JCP 4 5 3
SDP 1 1 1
PNP 0 0 1
RC 0 0 --
NPN 0 1 0
Other political parties 2 1 3
Don't know 21 12 29

(Note) Figures shown in percentage, rounded off. "0" indicates that
the figure was below 0.5 PERCENT . "--" denotes that no respondents
answered. "No answer" omitted. Figures in parentheses denote the
results of the last survey conducted June 13-14.

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Polling methodology: The survey was conducted July 18-19 over the
telephone across the nation on a computer-aided random digit
sampling (RDS) basis. A total of 1,579 households with one or more
eligible voters were sampled. Answers were obtained from 1,045
persons (66 PERCENT ).

(11) Poll: Aso cabinet, political parties, election for House of
Representatives

ASAHI (Page 8) (Full)
July 19, 2009

Questions & Answers
(Figures shown in percentage)

Q: Do you support the Aso cabinet?

Yes 20
No 74

Q: Which political party do you support now?

Liberal Democratic Party (LDP) 27
Democratic Party of Japan (DPJ or Minshuto) 32
New Komeito (NK) 4
Japanese Communist Party (JCP) 2
Social Democratic Party (SDP or Shaminto) 1
People's New Party (PNP or Kokumin Shinto) 0
Reform Club (RC or Kaikaku Kurabu) 0
New Party Nippon (NPN or Shinto Nippon) 0
Other political parties 0
None 32

Q: There will be a general election before long for the House of
Representatives. To what extent are you interested in the
forthcoming general election?

Very interested 42
Somewhat interested 39
Not very interested 16
Not interested at all 3

Q: If you were to vote now in a general election for the House of
Representatives, which political party would you vote for in your
proportional representation bloc?

LDP 28
DPJ 52
NK 5
JCP 3
SDP 2
PNP 1
RC 0
NPN 0
Other political parties 6

Q: Which political party's candidate would you like to vote for in
your single-seat constituency?

LDP 29
DPJ 47

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NK 4
JCP 3
SDP 1
PNP 1
RC 0
NPN 0
Other political parties 2
Independent candidate 10

Q: Who do you think is more appropriate for prime minister, Prime
Minister Aso or DPJ President Hatoyama?

Prime Minister Aso 21
DPJ President Aso 50

Q: What's your image of a political party's head?

A person leading a party's policy 53
A person symbolizing a party's nature 11
A person elected as the face of a party for election campaigning 12
A person elected in an intraparty power game 21


Q: When you make a judgment about whether a political party's head
is good and bad, to what extent do you attach importance to (1)
political ideal, (2) policy-planning ability, (3) leadership
ability, (4) public accountability, and (5) cleanness?

(1) (2) (3) (4) (5)
Very much 37 42 58 65 49
Somewhat 50 46 33 27 35
Not very much 9 9 6 5 12
Not at all 1 1 1 1 2

Q: When you choose a political party or a candidate to vote for, to
what extent do you attach importance to who the party's head is?

Very much 22
Somewhat 46
Not very much 27
Not at all 4

Q: When you make a judgment about whether a political party's actual
results in the past are good and bad, to what extent do you attach
importance to (1) policies or standpoints translated into action,
(2) how it debated in Diet deliberations or how it responded to
legislative measures, (3) what its lawmakers have said and done or
whether its lawmakers were involved in scandals or not, and (4) what
its lawmakers are doing in their respective communities?

(1) (2) (3) (4)
Very much 41 31 38 25
Somewhat 49 50 38 44
Not very much 7 15 19 25
Not at all 1 2 3 3

Q: When you choose a political party or a candidate to vote for, to
what extent do you attach importance to the party's actual results
in the past?

Very much 29
Somewhat 56

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Not very much 12
Not at all 1

Q: When you make a judgment about a political party's actual
results, do you weigh its actual results in the past year or two or
its actual results over a long period of 5 or 10 years?

Actual results in the past year or two 49
Actual results over a long period of 5-10 years 46

Q: If a political party you voted for in the forthcoming election
comes into office and find it falling short of expectations in its
actual results, then what do you think you will do in the next
election?

Vote for another political party 59
Vote for the same political party 24
Abstain from voting 8

Q: To what extent do you appreciate the LDP's actual results in the
past?

Very much 3
Somewhat 47
Not very much 36
Not at all 11

Q: To what extent do you appreciate the DPJ's actual results in the
past?

Very much 4
Somewhat 42
Not very much 41
Not at all 9

Q: Do you think there is a big difference between the LDP's policy
measures and the DPJ's?

Yes 36
No 59

Q: Then, do you think there is a big difference between the LDP and
the DPJ when it comes to their specific polices for (1) social
security, including pensions, (2) fiscal reconstruction, (3) foreign
relations and national security, (4) politics and money, and (5)
bureaucracy?

(1) (2) (3) (4) (5)
Yes 43 44 28 25 41
No 51 48 62 69 50

Q: When you choose a political party or a candidate to vote for in
the forthcoming election for the House of Representatives, do you
attach importance to the party's head or the party itself?

The party's head 15
The party itself 81

Q: When you choose a political party or a candidate to vote for in
the forthcoming election for the House of Representatives, to what
extent do you attach importance to the party's campaign pledges?


TOKYO 00001659 017 OF 020


Very much 35
Somewhat 52
Not very much 11
Not at all 1

Q: When you choose a political party or a candidate, to what extent
do you attach importance to expectations for the party?

Very much 42
Somewhat 46
Not very much 9
Not at all 1

Q: When you choose a political party or a candidate, do you attach
importance to the party's actual results in the past or your
expectations for the party in the future?

Actual results in the past 20
Expectations in the future 76

Q: When you choose a candidate to vote for in your single-seat
constituency of the House of Representatives, do you attach
importance to the candidate's qualifications or that candidate's
political party?

Mainly the candidate's qualifications 26
The candidate's qualifications to a certain degree 28
About the same 20
The candidate's political party to a certain degree 18
Mainly the candidate's political party 6

Q: When you choose a candidate to vote for in your single-seat
constituency of the House of Representatives, do you have a positive
image or a negative image about (1) a hereditary candidate, (2) a
candidate who was a central government bureaucrat, (3) a candidate
who was a mayor, governor, or local assembly member, (4) a candidate
who was a private business employee, and (5) a candidate who was a
civic activist?

(1) (2) (3) (4) (5)
Positive image 8 7 33 30 29
Neither 68 62 61 65 59
Negative image 21 28 3 3 9

Q: What do you think is the most important factor for you to choose
a political party and a candidate in the forthcoming election for
the House of Representatives?

The party's head 3
The party's actual results in the past 12
Expectations for the party in the future 47
The Party's campaign pledges 19
The candidate's self 16

Q: Would you like the current LDP-led coalition government to
continue, or would you otherwise like it to be replaced with a
DPJ-led coalition government?

LDP-led coalition 28
DPJ-led coalition 52

Q: Do you look forward to a change of government or feel uneasy

TOKYO 00001659 018 OF 020


about it?

Look forward 60
Feel uneasy 32

Q: If there is a change of government, how do you think Japanese
politics will?

Change greatly 10
Change somewhat 54
Not change very much 32

Q: When you make a judgment about whether a political party is
competent to run the government, to what extent do you attach
importance to (1) governing experience in the past, (2)
policy-planning ability, (3) its head's ability, and (4) its human
resources?

(1) (2) (3) (4)
Very much 9 31 36 33
Somewhat 43 54 49 30
Not very much 39 11 12 13
Not at all 5 1 2 2

Q: To what extent do you think the LDP is competent now to run the
government?

Very much 5
Somewhat 39
Not very much 41
Not at all 12

Q: To what extent do you think the DPJ is competent now to run the
government?

Very much 6
Somewhat 53
Not very much 31
Not at all 6

Q: When you choose a political party or a candidate in the
forthcoming election for the House of Representatives, to what
extent do you think about the choice of government?

Very much 34
Somewhat 49
Not very much 14
Not at all 2

Q: When you vote in the forthcoming election for the House of
Representatives, what do you think you will do? Pick only one that
is closest to your mindset from among those listed below.

Choose a political party that is closest to my thinking 32
Choose a person appropriate to become a lawmaker 24
Choose a political party competent to run the government 30
Choose a person who will become prime minister 2
Express dissatisfaction with politics 9

Q: Did you vote in the past elections for the House of
Representatives and for the House of Councillors?


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Almost every time 63
Many times 20
Not very often 10
Almost no 4

Q: What was your voting behavior in the past elections for the House
of Representatives and for the House of Councillors?

Voted for almost the same party or the same party's candidate 79
Voted for a different party and a different party's candidate each
time 16

Q: Do you think your voting behavior will remain the same in future
elections for the House of Representatives and for the House of
Councillors?

Yes 55
No 37

Polling methodology: The survey was conducted by mailing the
questionnaire form to a total of 3,000 voters chosen across the
nation on a stratified two-stage random sampling basis. A total of
339 voting blocs were selected so as to epitomize the nation's
electorates at large, and nine persons were picked on average from
each voting bloc's register. The questionnaire form was sent June 17
and was sent back from a total of 2,263 persons before July 13.
Valid answers were from 2,227 persons, excluding answer sheets left
blank or filled out by those not subject to the survey. The
retrieval rate was 74 PERCENT . In the breakdown of respondents,
males accounted for 46 PERCENT , with females at 53 PERCENT and
unknown at 1 PERCENT . In the breakdown of age brackets, persons in
their 20s accounted for 11 PERCENT , 30s-16 PERCENT , 40s-16 PERCENT
, 50s-18 PERCENT , 60s-19 PERCENT , 70-14 PERCENT , 80 and over-6
PERCENT .

(Corrected copy): Tearful prime minister expresses "remorse" at
meeting of LDP Diet members; Humble attitude suppresses discontent

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

Akihiro Ikushima

At the meeting of Liberal Democratic Party members of both houses of
the Diet held before the plenary session of the House of
Representatives where its dissolution would be declared, Prime
Minister Taro Aso said: "My only wish is that all of you who plan to
run in the election will (get elected and) return to this place."
Aso's tearful words suppressed the discontent going into the
election campaign amid a raging adverse wind.

The prime minister, who abhors showing his weakness or being
criticized for "wavering," admitted his responsibility for the
successive defeats in the recent major local elections and expressed
his "remorse and apology." He took a humble attitude to show the
party's unity at the time of Diet dissolution.

Aso takes pride in the fact that he was able to prevent the economy
from sinking deeper and deeper since he took office. Even after the
cabinet support rating dropped to a crisis level, his determination
to "seek the people's verdict for this administration's
achievements" remained unshaken, and he insisted on exercising his

TOKYO 00001659 020 OF 020


power to dissolve the Diet.

However, the prime minister also understands that this election
campaign will be an uphill battle. His aides say that: "He is
anxious that his policies have not been conveyed properly to the
people and is not so self-assured about winning the election."

In his news conference announcing the dissolution of the Diet, Aso
did not define his criterion for victory in the general election. He
bristled at reporters' persistent questions on this and said: "Do
you think I can answer a question premised on losing the election
just like that? The election campaign has just begun."

Will the prime minister be able to fight off the adverse wind?
Toward the end of the news conference, he could only fall back on
his fighting spirit. He stated: "An election is where one does
everything in his power, works as hard as possible, and puts forth
all his strength."

ZUMWALT