DAILY SUMMARY OF JAPANESE PRESS 02/06/09

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SUBJECT: DAILY SUMMARY OF JAPANESE PRESS 02/06/09

INDEX:

(1) DPJ's Ozawa gets started for an April general election
(Mainichi)

(2) Machimura becomes faction head; Mori distrusts Nakagawa
(Mainichi)

(3) Analyzing the crisis: Shift away from market fundamentalism
(Mainichi)

(4) Editorial: Obama must not allow chain reaction of protectionism
triggered by U.S. (Nikkei)

(5) Editorial: Trilateral unity should be solidified (Sankei)

(6) Local residents voice anger at U.S. military against live-fire
training (Okinawa Times)

(7) Fierce race underway for top post of nuclear watchdog; Japan
making every effort to get Amano elected as new IAEA director
general (Asahi)

ARTICLES:

(1) DPJ's Ozawa gets started for an April general election

MAINICHI (Page 5) (Full)
February 6, 2009

Democratic Party of Japan (DPJ) President Ichiro Ozawa recently
stated that the next Lower House election would take place in April.
He has now begun to make genuine efforts to prepare for the
election, kicking off a stumping tour. Yesterday, he stressed his
view in the form of falling in line with an argument in the ruling
camp that the Lower House should be dissolved immediately after the
passage of the fiscal 2009 budget bill. However, with the Diet being
in the middle of a fierce battle between the ruling and opposition
parties, there seems no way in sight for the enactment of the budget
bill, which is a condition for Lower House dissolution. The dominant
view in the DPJ is that Ozawa aims to boost morale, according to a
mid-level lawmaker.

When asked by reporters about his grounds for an April general
election, Ozawa said yesterday:

"Since there is a time-lag between the passage and implementation of
the budget, if the election is held sometime during that period,
there will be little negative impact on the livelihoods of the
people."

He added: "I believe that ordinary LDP and New Komeito members
probably think so, but I don't know how Mr. Aso thinks."

In a meeting on Jan. 31 of postmasters, Ozawa stated: "The Lower
House will be dissolved in March and the general election will be
called in April." He has reiterated similar remarks since then. He
called yesterday without prior notice at the office of a DPJ
candidate in Machida City, Tokyo. He also instructed the candidate
to be ready for an April election.

(2) Machimura becomes faction head; Mori distrusts Nakagawa

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MAINICHI (Page 5) (Full)
February 6, 2009

Internal conflict in the Machimura faction of the ruling Liberal
Democratic Party (LDP),has now been settled with decisions being
made in a meeting yesterday that former Chief Cabinet Secretary
Nobutaka Machimura would be promoted to be faction chairman and that
former LDP Secretary General Hidenao Nakagawa would be demoted in
effect. However, in the meeting that lasted more then two hours,
many junior and mid-level lawmakers took a cautious stance toward
the leadership shift. As such, the gulf in the LDP's largest faction
has further widened. A senior faction member with close ties to
former Prime Minister Yoshiro Mori, the faction's supreme adviser
who forced through the leadership change, said: "If he doesn't want
to follow the faction's policy, he should leave." There are still
sources for a breakup of the faction.

"Criticism of the government by a person who has served as secretary
general will cause trouble for the party," said Mori, criticizing
Nakagawa in a strong tone at the meeting. Mori's strong distrust of
Nakagawa was the biggest reason behind his sharp words. In the LDP
presidential election last September, Nakagawa threw his support
behind former Defense Minister Yuriko Koike. He has distanced
himself from the Aso administration, while criticizing Prime
Minister Taro Aso's policy, particularly the proposed consumption
tax hike, ever since the administration was launched. Mori adamantly
told Nakagawa, who favors political realignment: "I will never allow
a subgroup of the faction to exist."

However, Nakagawa only went so far as to say: "I have worked hard
for the faction." Junior to mid-level lawmakers, including Upper
House member Ichita Yamamoto, rebutted him, with one saying: "Chaos
should not be created in the faction just before the Lower House
election." Another said: "More time should be taken for discussion."
There was a scene in which Mori scolded Nakagawa sharply, saying:
"If you are unhappy with Mr. Machimura, you should directly tell
him."

Former Prime Minister Shinzo Abe, an advisor to the faction, urged
an early settlement in the meeting, saying: "Unless the issue is
resolved, a power struggle will start. That should be avoided."

After the meeting, although Machimura asked Nakagawa for a meeting,
Nakagawa refused the request, saying: "I don't have time." Faction
members are wondering if Nakagawa may leave the faction in the end.


Nakagawa met last night with about 10 first-term lawmakers from the
faction at a Japanese restaurant in Tokyo. He was ostensibly calm
when he said: "It is important to hold on to your own beliefs. Since
Japan is in the difficult situation, we need to implement policy
measures we believe in. Compared with that, the faction's problem is
not a big deal."

(3) Analyzing the crisis: Shift away from market fundamentalism

MAINICHI (Page 2) (Full)
February 6, 2009

Interview with economist Hirofumi Uzawa


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-- How do you see the nature of the ongoing financial crisis?

"The ongoing financial crisis indicates that market fundamentalism
has collapsed. Market fundamentalism has been the mainstream
thinking since economic reforms by the Reagan administration in the
U.S. and the Thatcher administration in Britain in the 1980s. The
Bush administration has also promoted it. As a result, the thinking
that if there is an opportunity to make money, one can do anything
to earn money has become rampant. The current crisis is the
consequence of such market fundamentalism. It has destroyed the
global economy. The blow dealt is immeasurable."

-- During the Great Depression of the 1930s, Franklin Roosevelt
served as the president of the U.S.

"President Roosevelt separated the role of banks from that of
securities houses under the Glass-Steagall Act in 1933. The nature
of banks, which extensively collect deposits, and securities houses,
which earn money with stocks, is totally different. Banks have
intensified the bubble economy. However, banks and securities houses
are essentially common social capital that plays a key role in order
for economic activities to function smoothly and for people to lead
stable lives. They must not be used for speculative purposes. The
New Deal program clarified this principle. That had great meaning in
the history of capitalism.

-- Nevertheless, the U.S. again tilted toward speculation.

"Deregulation has been promoted, based on market fundamentalism. As
a result, the management of banks has become sloppy. The current
financial crisis is the outcome of banks selling housing loans to
those with low repayment capability and spreading financial products
containing housing loan bonds, pretending that they were safe
products.

-- There is a deep-seated view that it is necessary to ensure free
economic activities, by scrapping regulations.

"Freedom has two meanings -- freedom of market fundamentalism,
liberty to make society in which citizens' basic rights are
respected and they can enjoy their freedom to the maximum extent.
Market fundamentalism exploits poor people or people who are
suffering. Japan has introduced competition principles. As a result,
its medical services and education system have become run down."

-- The Bush administration was negative toward measures to curb
greenhouse gas emissions.

"That administration's logic was to pursue economic growth of its
own country and had no regard for other countries' suffering. This
is the notion of market fundamentalism, which gives priority to
making profits. The unilateralism of the U.S., including the Iraq
War, was awful. Its unilateralism has rebounded against itself in
the form of a financial crisis. The unipolar world centered around
the U.S. is coming to an end, with the financial crisis as the
occasion."

-- President Obama's economic policy is called the new New Deal
program.

"Mr. Obama aims high. He is a wonderful person. I would like him to
make a fundamental shift from market fundamentalism and display

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leadership in rebuilding a framework for new international
cooperation. However, his economic team includes members who
advocate an economic policy close to market fundamentalism. I do not
know to what extent we can pin our hopes on President Obama."

Hirofumi Uzawa: Graduated from the Tokyo University Faculty of
Science. Served as the dean of the Tokyo University Department of
Economics. Worldwide economist, who led the development of
neoclassical theory. His works include "Social Cost of Automobiles,"
Economics of Global Warming," and "Common Social Capital." 80 years
old.

(4) Editorial: Obama must not allow chain reaction of protectionism
triggered by U.S.

NIKKEI (Page 2) (Full)
February 6, 2009

Given the ongoing global economic recession, protectionist moves
have reared up in the United States. A "Buy American" provision was
included in the economic stimulus bill that passed the House of
Representatives last week. If the bill is enacted as is, a domino
effect would begin and protectionism would spread across the world.

The Buy American provision requires the U.S. government to use only
U.S.-made steel, iron or clothing materials for public works
projects, shutting out foreign products. President Barack Obama
should urge Congress in a resolute manner to revise the bill.

The rest of the world is paying close attention to what trade policy
the Obama administration will take. Obama said that the provision
should be reviewed, but he has yet to refer to the possibility of
using his veto power. Some observers point out that he fears a
showdown with the Congress.

In an attempt to include the provision in the stimulus package,
Democratic Party lawmakers from steel-producing states played a
leading role. They reacted apparently in response to strong pressure
from domestic steel companies and their workers who have seen demand
sharply plunging as a result of the recession.

The House, at the proposal of a new member from the Democratic
Party, also added to the bill a clause that would limits the
uniforms worn by baggage inspectors at airports and other textile
products at airports to U.S.-made ones. Meanwhile, the Senate is now
discussing a bill that would expand the scope of obligatory
procurement to include all industrial products, not limited to steel
and iron products.

In recent U.S. political circles, lawmakers have made moves
apparently aimed to court the public's favor. It is certain that
American firms' deteriorating business performance and employment
uncertainty have invited the Congress to opt for protectionism.

Given shrinking demand due to the global financial crisis, many
countries have begun to incline toward protecting their own domestic
industries. Russia has raised tariffs on automobiles from the
current 25 PERCENT to 30 PERCENT . India has also increased tariffs
on steel and some food products. This trend is observed in Latin
American countries, as well.

More countries, once they judge that Washington has inclined toward

TOKYO 00000292 005 OF 009


protectionism, may raise tariffs, following on the heels of the U.S.
The Buy American provision contains the danger of triggering a
negative chain reaction.

The Senate's bill added this wording: "(the provision) be applied in
a manner consistent with U.S. obligations under international
agreements." But the substance of the bill itself remains unchanged.
If the bill passes the Senate, a final decision will be entrusted to
the hands of President Obama. Obama should not make a compromise in
a move to enact the stimulus bill in a rush.

President Obama, who appeared on the stage while shouldering the
burden of the world's expectations, has the responsibility to
persuade domestic protectionists to change their stance. We expected
the new U.S. president to demonstrate powerful leadership.

(5) Editorial: Trilateral unity should be solidified

SANKEI (Page 2) (Full)
February 5, 2009

North Korea is now preparing to launch long-range ballistic
missiles, including a Taepodong-2 missile that can reach U.S.
territory. If North Korea should launch a missile after an interval
of three years, tensions will run high on the Korean Peninsula,
involving the Obama administration right after its inauguration.

According to U.S. reconnaissance satellite and South Korean
intelligence, cargoes are being trucked or carried on a train to a
missile launch site in North Korea's northern part. Those
containerized objects, judging from the shape of their containers,
are reportedly presumed to be for a Taepodong-2 missile or a larger
one.

In July 2006, North Korea launched missiles. At that time, the
Taepodong-2 broke up in the air and its launch ended in failure.
Even so, the Taepodong-2's range is estimated at 6,000 kilometers,
which covers Alaska. Its enhanced type-ranging 12,000 kilometers-can
reach the West Coast of the U.S. mainland, meaning a new threat to
the United States. This is a serious problem also for Japan, which
is seeking a comprehensive settlement of the nuclear, missile, and
abduction issues. North Korea must never be allowed to launch
missiles.

At this point of time, North Korea made such an ostentatious move to
show off. This move can be taken to mean that the new U.S.
administration's inauguration was in Pyongyang's mind. The Obama
administration has now set about tackling the Middle East and
Afghanistan issues. When it comes to the North Korea problem,
however, the Obama administration is now examining the past
negotiations, according to Secretary of State Clinton. Basically,
the Obama administration will continue the six-party talks that
started under the Bush administration.

On the other hand, North Korea, as a nuclear power, is demanding a
new round of nuclear disarmament talks. North Korea possibly
intended to make the most of its threat, aiming as usual to hold
talks to its advantage.

Granting that the move is intended to intimidate the U.S.
government, however, we must say it is an irresponsible conduct to
heighten tensions on the Korean Peninsula. In 2005, the six-party

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talks reached an agreement. On that occasion, North Korea promised
to abandon its nuclear ambitions. Nevertheless, North Korea has
refused nuclear inspections to date in spite of its removal from the
terrorist blacklist and its fuel oil acquisition for nothing.

Secretary Clinton will visit Japan, China, and South Korea in
mid-February. President Obama had a telephone conversation with the
leader of each country and agreed to attain the Korean Peninsula's
denuclearization in the six-party talks. This month, Japan will
preside over the United Nations Security Council. North Korea's
bluff diplomacy will only strengthen the unity and cooperation of
Japan, the United States, South Korea, and China.

North Korea should return to the starting point of the six-party
talks and then should sincerely deliver on its agreement to accept
nuclear inspections and abandon its nuclear programs. Reckless
behavior will bring nothing productive. North Korea should realize
that it will be further isolated.

(6) Local residents voice anger at U.S. military against live-fire
training

OKINAWA TIMES (Page 31) (Full)
February 6, 2009

"The U.S. military should own up to its responsibility." With this,
a resident of Kin Town voiced anger as Okinawa prefectural police
announced findings from their investigation of a recent incident in
which a stray bullet hit a local resident's vehicle parked in the
town's Igei district. It has been 54 days since the bullet was
discovered. The police have yet to find out why such an incident
occurred. However, the U.S. military is carrying out live-fire
training at Camp Hansen, a U.S. military base contiguous to the
town. Local residents claimed that the U.S. military should stop
such live-fire training at once since the police have now found that
the discovered bullet is the same as the U.S. military's.

"The U.S. military uses that kind of bullet at Camp Hansen, so the
bullet came flying. I can't think of any other reason. That bullet
is not used in private areas, is it?" This comment came from Mitsu
Tamaki, 70, who learned of the prefectural police's announcement
when she was interviewed by the Okinawa Times. Tamaki saw white
smoke spreading at her house's parking space. She looked into the
police statement. "I don't know well from this alone," she said. She
asked, "I want them to tell us more exactly if there is something
relevant between the incident and Camp Hansen."

"This is the same as what the local residents have said," Masafumi
Ikehara, who represents the Igei district, said. "The U.S. military
should stop the live-fire training right away, and I want the
prefectural government to take strong action," Ikehara added.

Kin Mayor Tsuyoshi Gibu was upset, saying: "The bullet is the same
as the sample given by the U.S. military. This means the bullet came
flying from the U.S. military's training ground. That's my
impression. We have noted that the training is dangerous.
Nevertheless, they continued the live-fire training. I feel angry
about this fact." The town will hold a meeting of the Igei
district's representative and the town's assembly members to discuss
what to do from now on.

The town's assembly will hold a meeting of its special committee on

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U.S. military bases. Its chairman, Masanobu (or Shoshin) Nakama,
elected from the Igei district, was upset, saying: "Judging from the
circumstantial evidence, it's clear that the bullet came from Camp
Hansen. That's a defective training ground. We will discuss what to
do, including our request to remove the base." The committee will
meet this afternoon.

Katsuhiro Yoshida, an Okinawa prefectural assembly member elected
from the town of Kin, said: "We have confirmed that the U.S.
military was carrying out training at Range 7 when the incident took
place that day. This problem will affect the lives of people in the
prefecture, so the prefectural police should ask the U.S. military
to provide information in order to clear up the facts about the
incident, including what they did in the training that day, as well
as the training unit's name and the guns they used." He added: "We
must not leave this matter unsettled with the prefectural police's
findings. The U.S. military's fact-finding team could come up with a
conclusion for the U.S. military. The Foreign Ministry and the
Defense Ministry also should cooperate with the Okinawa prefectural
police and should call for the U.S. military to disclose even more
information."

(7) Fierce race underway for top post of nuclear watchdog; Japan
making every effort to get Amano elected as new IAEA director
general

ASAHI (Page 3) (Abridged slightly)
February 6, 2009

Atsuko Niuchi, Vienna

The Japanese government has begun making serious efforts for
obtaining the post of the director general of the International
Atomic Energy Agency (IAEA),the UN nuclear watchdog. Japan has
nominated ambassador to the International Organizations in Vienna
Yukiya Amano, 61, as a candidate to succeed Mohamed ElBaradei. With
an eye on a vote in March, a fierce competition is underway with the
South African candidate.

A Foreign Ministry official in charge described the upcoming
election as a national project. He said: "From the prime minister,
administrative vice-ministers, lawmakers, and to administrative
officials of relevant ministries and agencies, our country has been
calling for support for (Amano) by using every possible means."

Amano's nomination was announced in the speech delivered last
September by Prime Minister Taro Aso before the UN General Assembly.
The Assembly was immediately followed by an IAEA general conference
in which former Science and Technology Policy Minister Iwao Matsuda
representing Japan delivered a speech and repeated "Yukiya Amano"
eight times. In closing his speech, Matsuda introduced Amano in
person to the assembly.

In order to be appointed, a candidate must secure a two-thirds vote
of the 35-member IAEA board of governors. The Foreign Ministry has
set up the election campaign headquarters headed by Foreign Minister
Hirofumi Nakasone. The members meet once a week to discuss
strategies. The ministry has printed some 3,000 copies of an
English-language pamphlet describing Hamano as a person of strong
leadership with deep experience in order to distribute them to IAEA
board members and others.


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Amano himself has visited many IAEA board member countries to sell
himself.

Amano's rival is Abdul Minty, 69, South African ambassador to the
IAEA. According to an IAEA diplomatic source, Minty has won the
support of the African Union (AU) in return for handing over the
chair of the IAEA board of governors to another African country.

Both Japan and South Africa have frequently held luncheon meetings
and receptions at various parts of the world, including Vienna where
the IAEA headquarters is located. As seen in lavish business
entertainment and trade in international organization posts,
anything goes mentality is evident.

Key position with eye on North Korea

There are reasons why Japan is eager to get the top IAEA position.
One is because except for the UN Security Council, there is no
international framework that carries more political weight than the
AIEA, as a senior Foreign Ministry official put it. The IAEA and its
Director General ElBaradei won the 2005 Nobel Peace Prize.

The IAEA plays a major role in inspections of nuclear programs in
North Korea and Iran. Chances and the number of countries subject to
nuclear inspection are expected to grow with an increase in the use
of nuclear energy due to measures to combat global warming and
soaring fossil fuel prices. The government thinks the secretary
general's post will significantly help increase the ability to
gather information.

In the election campaign, Japan as the only country to have suffered
atomic bombs has played up the unique role it can play as a country
that has used nuclear power peacefully over the last half century. A
senior Foreign Ministry official said: "Japan has developed
inspection technologies in cooperation with the IAEA. If Mr. Amano
becomes IAEA director general, we can expand the use of nuclear
energy while preventing such technologies from being used
militarily."

The other reason is that Japan might not have any top post of major
international organizations after Koichiro Matsuura resigns as
UNESCO director general this fall.

The Japanese candidates were defeated in the race for the top
position of the Organization for Economic Cooperation and
Development (OECD) in 2005 and the race for the World Health
Organization (WTO) in 2006. Contributions to international
organizations and the government's official development assistance
(ODA) budget are also dropping. Japan is strongly alarmed at a
further decline in its presence in the international community.

South Africa remains upbeat

Chair of the board of governors Taous Feroukhi of Algeria is looking
for ways to come up with single candidate through talks. But Amano
and Minty are set to clash head on. Chances are high that a vote
will take place in the regular board of governors' conference slated
to open on March 2.

Up to three secret ballots can be cast, and if the winner is still
not determined, the propriety of each candidate will be questioned
in the next vote. If that does not do the trick, the race will go

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back to the drawing board. Candidates can run again, but chances are
a third candidate will come forward. "Obtaining two-thirds approval
will not be that easy," a source connected with the Foreign Ministry
said.

According to a Vienna diplomatic source, about half of the 35
countries have yet to determine their attitudes.

In each case in the last two elections, the ones who came first did
not clear the two-thirds requirement and the one who came late won
the position.

This time around, besides Amano and Minty, such names as former
Mexican President Ernesto Zedillo and former Organization for the
Prohibition of Chemical Weapons Director-General Rogelio Pfirter are
being bandied as possible candidates for the job. A certain diplomat
took this view: "Some are hoping for a third candidate. The fact
that a large number of countries remain undecided might reflect such
an atmosphere."

Listening to Yukiya Amano -- Japan fit for the position

Armed with its foreign policy centering on disarmament and
nonproliferation, Japan has pursued the peaceful use of atomic
energy as the only atomic-bombed country. Proactively extending
technological cooperation, Japan is fit to produce the next IAEA
director general.

I have spent 36 years in the field of diplomacy. I have 15 years of
experience in disarmament and nonproliferation and nuclear energy. I
have also managed international organizations. I believe those
experiences are helpful in guiding the IAEA.

As seen in such issues as global warming, the nuclear issues of
North Korea and Iran, and nuclear terrorism, challenges shift with
the times. Priorities must be set straight under the limited
budget.

I am determined to streamline the IAEA further for an expanded use
of nuclear energy and for strengthening security measures.

ZUMWALT