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Cablegate: Japanese Morning Press Highlights 02/07/08

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UNCLAS SECTION 01 OF 12 TOKYO 000321

SIPDIS

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 02/07/08


Index:

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

4) Super Tuesday: Japanese government hoping Republic administration
will continue, concerned that Democratic one would give priority to
China over Japan (Tokyo Shimbun)

5) Prime Minister Fukuda planning to visit Russia in May (Mainichi)


Economic issues:
6) Japan-China food poisoning dispute is a heavy blow to
government's growth strategy (Mainichi)
7) LDP's Yosano attacks "market fundamentalism" (i.e., American form
of free market economy) as incompatible with Japan's cultural
climate" (Sankei)
8) Supplementary budget passes Diet using Lower House override vote
(Yomiuri)
9) With skirmish over budget with opposition camp, Prime Minister
Fukuda finding it difficult to set Diet policy agenda that he can be
identified with (Nikkei)
10) Although ruling parties seek dialogue with opposition side on
budget process, the outcome in March remains unclear (Mainichi)
11) Democratic Party of Japan (DPJ) proposal would shave road
construction budget to 1.7 trillion yen (Yomiuri)
12) Government to revise bill restricting foreign ownership of
airports (Sankei)

Political agenda:
13) Government plans move to a regional bloc system, replacing
prefectures, over a ten-year period (Sankei)
14) Yukari Sato, one of the "Koizumi children," plans to run for the
Tokyo 5 seat in the next Lower House election (Mainichi)
15) Prime minister speaks up consumer administration reform.
(Mainichi)

16) Poll on whaling shows widespread approval: 56 PERCENT want to
eat whale meat; 65 PERCENT want research whaling to continue
(Asahi)

17) Budget proposal contains 1.2 trillion yen for CO2 reduction
measures (Mainichi)

18) Iwakuni election in a dead heat (Mainichi)

Articles:

1) TOP HEADLINES

Asahi:
U.S. Democrats locked in close battle on Super Tuesday

Mainichi:
U.S. Democrats tie on Super Tuesday

Yomiuri:
U.S. Democrats fall short of ending battle for presidential race
candidate on Super Tuesday


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Nikkei:
Major banks to provide compensation for damages from unauthorized
deposit withdrawals over the Internet

Sankei & Tokyo Shimbun:
Benzene not used in Japan detected in package of gyoza dumplings

Akahata:
JT Foods received 11 complains about Tianyang Food's frozen products
since last spring

2) EDITORIALS

Asahi:
(1) Consumer administration: Prepare for reorganizing Kasumigaseki
(2) U.S. presidential race: Vigorous Democrats and Republicans in
uproar

Mainichi:
(1) Road debate: Time for DPJ to show presence
(2) U.S. presidential race: Battle to break the impasse

Yomiuri:
(1) U.S. presidential battle still rages on after peak
(2) Murky boundary between virtual world and actuality

Nikkei:
(1) Is this a sign of change in U.S. politics?
(2) Chinese-made tainted gyoza scare prevents JT-Nissan food merger

Sankei:
(1) Restrictions on foreign investment in airports: Security
argument important
(2) U.S. presidential race: Candidates should talk about foreign
policy

Tokyo Shimbun:
(1) U.S. presidential race: Time for candidates to show reform
measures
(2) Education Revitalization Council: New organization should face
actual problems

Akahata:
(1) March 1 - Bikini Day: Need to boost campaign for elimination of
nuclear weapons

3) Prime Minister's Official Residence (Kantei)

Prime Minister's schedule, February 6

NIKKEI (Page 2) (Full)
February 6, 2008

10:00
Upper House Budget Committee meeting.

10:20
Met with Chief Cabinet Secretary Machimura at the Kantei, followed
by Health Minister Masuzoe.

11:01
Upper House plenary session.

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11:42
Met with Deputy Chief Cabinet Secretary Futahashi at the Kantei.
Then met with Secretary General Ibuki, followed by Futahashi.

13:02
Lower House plenary session.

13:17
New Year's party of the LDP Members' Wives Network held at the Ritz
Carlton Tokyo.

13:38
Met with Futahashi at the Kantei.

14:58
Met with European Parliament President Hans-Gert Bottering. Lower
House member Taro Nakayama was present.

15:32
Lower House plenary session.

15:59
Met with delegates of the Plum Delegacy, including the chief priest
of Dazaifu-Tenmangu. Lower House member Yoshiaki Harada was present.
Then met with Bahraini Foreign Minister Khalid.

16:46
Met with METI Vice Minister Kitabata, Small and Medium Enterprise
Agency Director General Fukumizu. Then met with Special Advisor to
the Cabinet Okuda, Chief Cabinet Secretary Machimura and Deputy
Assistant Chief Cabinet Secretary Saka.

18:19
Issued a letter of appointment to State Minister for Promotion of
Consumer Administration Kishida.

19:19
Arrived at the official residence.

4) U.S. presidential election: Gov't hopes Republican Party
administration will stay in office, concerned about Democratic
Party's China-oriented stance

TOKYO SHIMBUN (Page 2) (Full)
February 7, 2008

The U.S. presidential election is now underway with Republican Party
and Democratic Party candidates campaigning hard to receive
presidential nominations. The Japanese government is intensely
focused on how the race to the White House will turn out. There is a
chance that the Democratic Party may regain control of the White
House. However, Tokyo has strong hopes that a Republican Party
administration will stay in power, considering that the Bush
administration has built a favorable relationship between Japan and
the United States over the past seven years.

Some officials in the Japanese government analyze that the
Democratic Party is highly likely to march back into power, whoever
may win the nomination between Clinton and Obama. "The Democratic
Party has momentum," a senior official of the Foreign Ministry said.
"Especially," the official added, "the opposition party

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traditionally has the advantage when the economic situation in the
country is bad."

One government official, judging from Tokyo's experience during the
administration of President Bill Clinton, fears that if the
Democratic Party wins the presidential race, its administration,
which is "historically inward-looking and protectionist," would be
tough on Japan, especially in economic negotiations.

Furthermore, another official of the Japanese government fears that
the Democratic Party's administration may give more consideration to
China than Japan. Actually, Hillary Clinton, in her essay written
last fall for Foreign Affairs magazine, did not refer to Japan even
once. Instead, she noted, "Our relationship with China will be the
most important bilateral relationship in the world."

However, Senator Obama, when Prime Minister Fukuda visited the
United States last fall, stated before the full Senate that the
Japan-U.S. alliance is the foundation of peace and prosperity in the
Asia-Pacific region. Recently, Clinton also released a statement
with emphasis on Japan-U.S. relations in an aim to wipe away Japan's
concerns. "Unlike in the days of economic disputes," a source
familiar with bilateral diplomatic relations said, "there is
bipartisan understanding to recognize the importance of the
Japan-U.S. alliance."

Even so, the Japanese government, in its heart of hearts, does not
want to give up the 'honeymoon' relationship built by President Bush
and former Prime Minister Junichiro Koizumi.

In particular, Senator John McCain, who is now leading the
Republican Party's nomination race, has Japan hands as advisers,
including Richard Armitage, who once served as deputy secretary of
state in the Bush administration, and Michael Green, who was senior
director for Asian affairs at the National Security Council (NSC).
"He will understand so we don't have to explain to him our bilateral
relationship," a Foreign Ministry source said.

5) Prime Minister Fukuda to visit Russia in May to hold talks with
Putin before he steps down

MAINICHI (Page 2) (Full)
February 7, 2008

Yudai Nakazawa

Prime Minister Yasuo Fukuda yesterday made up his mind to travel to
Russia during the Golden Week holidays in May and meet with
President Putin. Putin has indicated he wants to hold a Japan-Russia
summit in Moscow sometime in May before his tenure of office
expires. Apparently, Fukuda has judged that meeting with the
president will contribute to moving the now stalled talks on the
Northern Territories issue forward.

As part of preparations for the Group of Eight summit in Lake Toya,
Hokkaido, (G8 Toyako Summit) in July, Fukuda is considering making a
tour of G8 countries in Europe during the May holidays. He is likely
to visit Russia on that occasion.

In a meeting with former Prime Minister Yoshiro Mori in last
December, when Mori was visiting Russia, Putin expressed his
enthusiasm about breaking the impasse on territorial negotiations,

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noting, "I am sure the territorial negotiations will be finalized."
Meanwhile, Fukuda in his Diet policy speech on Jan. 18 stressed: "I
will accelerate territorial negotiations in order to bring them up
to a higher level." Prior to the prime minister's visit to Russia,
Foreign Minister Masahiko Koumura will visit Moscow in late March
and set the stage for a Japan-Russia summit.

A diplomatic source familiar with Japan-Russia relations gave this
explanation about why Putin plans to hold a summit immediately
before he steps down: "He may want to demonstrate that he will
retain influence even under the new president."

6) Chinese dumpling scare hits JT's growth strategy; President:
"Frozen food business is in a crisis"

MAINICHI (Page 9) (Excerpts)
February 7, 2008

Japan Tobacco Inc. (JT) has scrapped a plan to integrate its frozen
food business with that of Nissin Food products Co. in the fallouts
of the recent food-poisoning outbreak involving Chinese-made frozen
dumplings. The poisoning incident hit JT's strategy of growing its
food division into its key business. President Hiroshi Kimura said
in a press conference yesterday that the company will make efforts
to revive its frozen food business, but it will not be easy to
dispel consumers' growing distrust.

JT President Kimura emphasized his determination to keep its
strategy, saying: "The strategy of growing the food division into
our key business remains unchanged." When demand for Japanese
tobaccos is shrinking, JT aims to expand the food division as its
key business, like the foreign tobacco section. JT was placing great
expectations on the integration plan with Nisshin in the frozen food
business following the joint purchase of frozen food company
Katokichi Co.

Due to the Chinese dumpling scare, however, "JT's frozen food
business is in a crisis," according to Kimura. Pressed with coping
with the incident, the company had to give up the integration plan.

7) Yosano criticizes market fundamentalism

SANKEI (Page 5) (Full)
February 7, 2008

Former Chief Cabinet Secretary Kaoru Yosano of the Liberal
Democratic Party gave a speech at party headquarters yesterday. In
the speech Yosano revealed a view critical of former Secretary
General Hidenao Nakagawa and other lawmakers who put high priority
on economic growth, saying: "The idea that economic growth will help
the country restore fiscal health is a great illusion. Market
fundamentalists' idea of creating a small government does not fit
the atmosphere in Japan." Yosano also argued that the approach of
turning the consumption tax into a social security tax and raising
the tax rate from the current 5 PERCENT to 10 PERCENT will help
the government achieve its objective of restoring fiscal health.

8) Supplementary budget bill approved with Lower House's decision
overriding the Upper House's

YOMIURI (Page 2) (Full)
February 7, 2008

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The 2007 supplementary budget bill that includes measures to deal
with soaring oil prices was approved yesterday afternoon. This bill
was adopted in the Lower House plenary session on Jan. 29, but it
was rejected by a majority of votes from the opposition bloc in the
Upper House plenary session yesterday morning. At the request of the
Lower House, the joint committee of both the chambers of the Diet
held a session yesterday afternoon, but no conclusion was reached
there. As a result, in accordance with the Constitution's Article 60
that stipulates the Lower House's decision overrides the Upper
House's, the budget bill was adopted. Adopting the supplementary
budget bill under that provision was the first time in 15 years
since 1993.

A bill amending the Tax Allocation to Local Governments Law, which
is related to the supplementary budget, was adopted by a majority of
votes from the ruling bloc and the major opposition Democratic Party
of Japan (DPJ) in the Upper House plenary session yesterday.

Following the passage of the supplementary budget bill, the Lower
House Budget Committee will commence deliberations on the 2008
budget bill today. The ruling bloc asked the opposition bloc at a
session yesterday of the Lower House Steering Committee to commence
debate on tax-system-related bills, such as a bill revising the
Special Taxation Measures Law aimed at maintaining the current
provisional tax rate for gasoline, at a Lower House plenary session
on Feb. 14 and 15, but this request was rejected by the opposition
parties.

9) Supplementary budget clears Diet; Prime Minister Fukuda finds it
difficult to place own imprint on policy during current Diet
session

NIKKEI (Page 2) (Excerpts)
February 7, 2008

A supplementary budget for fiscal 2007, which covers emergency
measures, including disaster relief and expenditures for people
suffering from high oil prices, was enacted yesterday based on
Article 60 of the Constitution, which stipulates that if the two
Diet chambers cannot reach an agreement over the budget, the House
of Representatives decision prevails. It was the first time in 15
years since 1993, when Article 60 was used by the cabinet of Prime
Minister Kiichi Miyazawa.

All eyes are likely to be on Fukuda's Diet management skills
centered on economic policy as deliberations start today on the
fiscal 2008 budget bill. Although Fukuda is eager to unify consumer
affairs under one administrative body, the main concern is whether
he will be able to bring about a conclusion by the end of the
current fiscal year (end of March) the contentious issue of
extending the provisional gasoline tax rate. Already, Fukuda's
handling of the plummeting stock market and sharp divisions in the
government and ruling parties over placing restrictions on foreign
investment in airports make him vulnerable to criticism that
"Fukuda's policy imprint remains invisible."

Fukuda spoke last night of the enactment of the supplementary
budget: "I am glad that this budget was enacted because it is
directly connected with the daily lives of the people." He appeared
relieved since he has been saying that an early enactment of the
supplementary budget and the fiscal 2008 budget bills would be the

TOKYO 00000321 007 OF 012


best possible measures (to counter falling stock prices).

Fukuda yesterday took action to appoint a minister in charge of
consumer administration, as well as to set up a council of
consumer-affairs experts. He is expecting that his policy of placing
priority on consumers will boost his administration's popularity,
based on its handling of a series of scandals over domestic
food-labeling fabrications and the current row over tainted gyoza
dumplings made in China. He also plans to take the initiative in
environmental and social security issues, setting up councils of
experts in the Prime Minister's Official Residence.

However, it is uncertain whether his efforts will be effective. In
the ongoing Diet session, the focus will solely be on the handling
of a bill revising the Special Taxation Measures Law that would
retain the current provisional rates for gasoline and other
road-related taxes. The ruling camp has called on the opposition to
present a counterproposal, but the opposition bloc has insisted the
provisional tax rates all be abolished. Therefore, there is no
prospect for consultations on revising the government-sponsored
bill.

10) Ruling camp to press DPJ to present counterproposal: Course of
provisional gas tax rate talks remain unclear

MAINICHI (Page 2) (Excerpts)
February 7, 2008

Secretaries general and Diet Policy Committee chairmen of the

SIPDIS
Liberal Democratic Party (LDP) and the New Komeito yesterday held
talks and agreed to urge the Democratic Party of Japan (DPJ or
Minshuto) to present a counterproposal to their special tax measures
bill incorporating a 10-year extension of provisional tax rate on
the gasoline tax, etc. The mediation proposals proposed by the
speaker of the Lower House and the president of the Upper House
mentions that items on which both parties agreed should be revised.
However, the LDP's road policy clique in the Diet is strongly
resisting the idea of revising the bill. The ruling camp has
apparently thrown the ball into the DPJ's court, anticipating that
opposition parties are not unanimous in their stance. Whether they
ever hold such talks is unclear.

LDP Secretary General Bunmei Ibuki stressed to reporters at the
Kantei that the DPJ needs to present a counterproposal, saying,
"Since the DPJ has accepted the mediation proposal, it should
contribute to efforts to set conditions for substantive Diet
deliberations. LDP members are in agreement on the notion that it is
impossible to revise the bill in such a manner that will lead to
revising the fiscal 2008 budget bill.

However, some are flexible toward such a revision with former
Secretary General Hidenao Nakagawa noting a plenary meeting of the

SIPDIS
Machimura faction on Jan. 31, "It is all right to discuss such
issues as reallocating road funds for other uses and a possible
adoption of an environment tax." However, General Council Chairman
Toshihiro Nikai, a veteran member of the transportation policy
clique in the Diet, checked Nakagawa's statement, "It is
dishonorable to say that we will respond to any proposal." The
ruling intends to wait for intraparty discussions to calm down,
while assuming the ball remains in the DPJ's court.

The DPJ is alert to the ruling parties' approach, seeing it as a

TOKYO 00000321 008 OF 012


clinch strategy. Diet Affairs Committee Chairman Kenji Yamamoto
during a press conference yesterday indicated his party's stance of
not responding to the ruling parties' call, noting, "The DPJ's
stance is clear. It is not necessary for us to present a
counterproposal. We will not make a superficial deal."

The DPJ is, however, preparing to submit a bill incorporating
reallocations of special-purpose road construction revenues for
other uses and scrapping the provisional tax.

11) DPJ bill for abolishing provisional gas tax rate proposes
halving outlays for road construction projects

YOMIURI (Page 2) (Full)
February 7, 2008

The Democratic Party of Japan (DPJ) yesterday released key points in
its bill calling for abolishing the current provisional road-related
tax rates, which the party plans to submit to the current Diet
session. The bill calls for scrapping the provision set in the
Special Taxation Measures Law for the current provisional gasoline
and other road-related tax rates and using the tax revenues for
general purposes.

Should this bill become law, spending for road-construction projects
will be reduced from the current about 3.4 trillion yen to about 1.7
trillion yen. The DPJ, though, stresses that there will be no
hindrance to road improvement in local areas, because generous
financial funding will be given to local governments.

An abolishment of the provisional tax rates will decrease local
governments' annual revenues by more than 1 trillion yen. To offset
this, the bill incorporates these measures: (1) Discontinue the
system in which local governments pay some of the expenditures for
public works projects commissioned by the central government; (2)
double the ratio of gasoline tax revenues distributed to local
governments from the current one-fourth to one half.

Although the DPJ admits that scrapping the provisional tax rates
will inevitably slow down road construction, it stresses that it
will be possible to construct necessary roads by cutting costs and
changing the order of priorities.

The main opposition party will carry out internal coordination to
submit the bill to the Diet, but some members are calling for
caution, with one saying that the party should carefully watch
progress in negotiations between the ruling and opposition parties
on changing the legislation over the road tax rates.

12) Government to reconsider proposed restrictions on foreign
investment in airports

YOMIURI (Page 2) (Full)
February 7, 2008

The government aims to submit a bill revising the Airport
Development Law to the current session of the Diet, but it yesterday
decided to take a second look at the bill. The government did so
because of opposition from some members of the cabinet, as well as
some lawmakers in the ruling Liberal Democratic Party (LDP), to a
plan presented by the Ministry of Land, Infrastructure and
Transport's (MLIT) for the introduction of foreign capital

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restrictions on airports. The government's initial plan was to get
approval for the bill at a cabinet meeting tomorrow, but it has now
decided to delay the plan. According to a high-level government
official, the government, after taking a "cooling-off period" for a
while, will review the bill and aim to reach a conclusion on a
course of action.

Chief Cabinet Secretary Machimura will work on the review of the
bill in cooperation with bureau director-level officials from
relevant ministries and agencies, including the MLIT and the
Financial Services Agency. The MLIT's proposal says that the
legislation shall be reviewed in five years after it takes effect,
but this five-year timeframe will possibly be shortened to two
years. In addition, the proposal states foreign capital's ratio of
shareholding shall be below one-third, but this percentage, too,
will be discussed in the direction of raising the level. Moreover,
relaxing the now tightened supervision of domestic airline companies
in connection with airport management will be discussed.

The bill may be divided into two in order to meet the timing for
budget deliberation: one for a review of airport management related
to budget and a second one for foreign capital.

13) Government panel calls for shift to doshu system in 10 years'
time

SANKEI (Page 2) (Full)
February 7, 2008

The government's doshu (regional bloc) system vision panel met
yesterday, in which chair Katsuhiko Eguchi presented his plan
specifying that the country should shift to a doshu system in about
ten years' time, by 2018. The report also says that the option of
dividing the country into regional blocs, now in focus, will be
specified in the panel's final report due out in the spring of 2010.
Eguchi also proposed limiting the government's role to 20 areas,
such as diplomacy and the maintenance of the currency system. This
part drew many objections. The panel plans to consolidate views in
the next meeting to present an interim report to Decentralization
Minister Hiroya Masuda in late March.

14) Yukari Sato to move to Tokyo No. 5 constituency for next Lower
House election

MAINICHI (Page 3) (Excerpts)
February 7, 2008

The Liberal Democratic Party unofficially decided yesterday to
endorse Yukari Sato, who ran in the 2005 "postal election" from the
Gifu No. 1 constituency (and eventually won a Tokai bloc
proportional representation seat), for the Tokyo No. 5 district. In
the Gifu No. 1 constituency, former "postal rebel" and former postal
minister Seiko Noda and Yukari Sato have been vying for party
endorsement. The LDP informally decided last month to enforce Noda
for that constituency. Sato has been pressed for a move to another
constituency. Sato, who is expected to accept the party's decision,
is likely to convey her acceptance to Election Strategy Committee
Chairman Makoto Koga later this week.

15) Consumer administration conference to move up first meeting to
Feb. 12 over gyoza scare


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YOMIURI (Page 2) (Excerpts)
February 7, 2008

The government decided yesterday to establish a conference on
promotion of consumer affairs administration tasked with determining
details of a new agency to integrate consumer administrative
functions now split among various government offices. Chief Cabinet
Secretary Machimura announced this decision in a press conference

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the same day. Gakushuin University Professor Tsuyoshi Sasaki, who
heads the Social Policy Council, an advisory panel to the prime
minister, is scheduled to chair the new experts' panel. Lawyers and
representatives from consumer groups will join the new body. Its
first meeting will be held on Feb. 12 after a formal decision is
made at a cabinet meeting tomorrow. The panel will come up with a
conclusion as early as April.

Machimura and State Minister for Consumer Affairs Kishida will also
participate in its all meetings. The government has set up a
preparatory office for integrating consumer affairs administration
in the Cabinet Secretariat yesterday as the head office of the
conference.

The formation of the new panel reflects Prime Minister Fukuda's
policy of giving priority to the people. The prime minister
initially intended to set up the body later this month, but he has
decided to accelerate the plan due to the fallout from the recent
food-poisoning outbreak involving Chinese-made frozen dumplings.

Speaking before reporters at the Prime Minister's Office last night,
Fukuda emphasized: "I thought we would be able to take our time and
thoroughly address the task. But the incident this time is raising
questions about whether consumer affairs administration from the
standpoint of the people has been implemented. We would like to
conduct a study and quickly establish a new system." The focus is on
whether the government will be able to set up a new body, reflecting
on the current lack of cooperation among relevant government
agencies, as well as of information exchange between the central and
local governments.

The Liberal Democratic Party's Research Committee on Fundamental
Policies for Consumers, chaired by Seiko Noda, compiled on Jan. 24
an interim report that specified (1) creation of a consumer agency;
(2) establishment of a administrative committee based on the Civil
Polity Law; and (3) reinforcement of the Cabinet Office's functions.
The new conference is expected to conduct discussions based on this
report and views to be presented in the Social Policy Council.

Fukuda has expressed a strong desire to create a new body with
powerful authority. To do so, however, it will be necessary to
transfer wide-ranging authority from government agencies to the new
body, and eventually the agencies involved will likely put up
resistance. When streamlining administrative work is being promoted,
it will not be easy to recruit able personnel, either. Given this, a
senior government official said about the aim of the prime minister:
"A conclusion reached by experts has more persuasive power for
government agencies."

16) Poll: 56 PERCENT back using whales for food

ASAHI (Page 37) (Full)
February 7, 2008


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An estimated 56 PERCENT of the Japanese public are in favor of
using whales for food, with 26 PERCENT against it, the Asahi
Shimbun found from its telephone-based nationwide public opinion
survey conducted Feb. 2-3. Asked about Japan's research whaling, 65
PERCENT supported its continuation. To both questions, there were
many affirmative answers from middle-aged and older respondents in
particular. Among women, there were many negative opinions. Asked
about using whales for food, negative answers outnumbered
affirmative answers among women in their 20s and 30s.

"Are you in favor of using whales for food, or are you against it?"
To this question, "yes" accounted for 70 PERCENT among men and
nearly 80 PERCENT among men in their 40s-60s. Among women, "yes"
accounted for 44 PERCENT , with "no" at 34 PERCENT . Above all,
among women in their 20s, "yes" accounted for 33 PERCENT , with "no"
at 58 PERCENT . Among women in their 30s, "yes" accounted for 34
PERCENT , with "no" at 41 PERCENT .

Another question was: "Japan continues its research-purpose whaling
in the Southern Ocean and other waters. However, this research
whaling is drawing strong criticism overseas. Do you support
continuing Japan's research whaling?" In response, 65 PERCENT
answered "yes," with 21 PERCENT saying "no." The proportion of
affirmative answers to this question was higher than that of
affirmative answers to the question about using whales for food.
"Yes" accounted for 75 PERCENT among men and 56 PERCENT among
women.

17) Government earmarks in fiscal 2008 budget 1.2 trillion yen for
CO2 cuts

MAINICHI (Page 2) (Full)
February 7, 2008

The Environment Ministry yesterday revealed that appropriations for
cuts in greenhouse gas emissions, such as carbon dioxide (CO2),
earmarked in the government's budget for the new fiscal year total
1.2166 trillion yen (up 1 PERCENT from the fiscal 2007 initial
budget). A budget for measures that will directly contribute to
Japan complying with its commitment, including afforestation for
more CO2 absorption by forests and the acquisition of emissions
credits, is 519.4 billion yen (up 2 PERCENT from the fiscal 2007
initial budget). Expenses for acquiring emissions credits sharply
increased to 30.8 billion yen, up 2.4 PERCENT from the fiscal 2007
initial budget, in the initial year of the reductions commitment
period under the Kyoto Protocol.

The breakdown of measures that are expected to produce direct
effects comes to 185.3 billion yen for forest CO2 absorption
measures, such as forest consolidation and soil-conservation
projects, and 118.8 billion yen for nuclear-power-related subsidies.
Other CO2 reduction measures include the development of fast breeder
reactors and the consolidation of streetcars.

18) Fukuda, Ihara neck and neck in Iwakuni mayoral race

MAINICHI (Page 3) (Abridged slightly)
February 7, 2008

There are only three days left before the Feb. 10 Iwakuni
gubernatorial election focused on the propriety of the relocation of
U.S. carrier-based air wing to the base in the city. A heated verbal

TOKYO 00000321 012 OF 012


battle is going on between former LDP House of Representatives
member Yoshihiko Fukuda, 37, who supports the relocation
conditionally, and former mayor Katsusuke Ihara, 57, who opposes the
relocation. Perceiving the current situation as neck and neck, the
two camps are in the homestretch.

Highlighting the city's financial difficulty focusing on services
for children and the elderly, Fukuda harshly criticizes Ihara's
administration. Fukuda plays up the importance of cooperation over
confrontation toward citizens who have begun showing signs of "base
fatigue" from the controversial relocation issue, while emphasizing
his determination to make school buildings earthquake resistant as
part of his livelihood-oriented policy. In the middle of the
election campaigning, Fukuda camp workers began noticing good
reactions in municipalities that have been merged into Iwakuni City.
Thos areas, that are traditionally conservative and less familiar
with the base issue than the original Iwakuni City area, are
reacting favorably to Fukuda's pledge that he will directly lobby
government agencies in order to win budgets.

On the other hand, Ihara rebuts: "It is a lie that the city's
finances are bankrupt. (Mr. Fukuda) is trying to make the
(anti-relocation voters) turn around their views by diverting the
focus from U.S. force realignment."

In the 2006 municipal referendum, 87 PERCENT of voters said 'no' to
the relocation. Vividly expressing his anger toward the government's
steps, such as its freeze on the subsidies for building a new city
hall, Ihara is trying to rally together such anti-relocation
citizens once again.

DONOVAN

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