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Cablegate: Daily Summary of Japanese Press 03/31/08

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PP RUEHFK RUEHKSO RUEHNAG RUEHNH
DE RUEHKO #0876/01 0910830
ZNR UUUUU ZZH
P 310830Z MAR 08
FM AMEMBASSY TOKYO
TO RUEHC/SECSTATE WASHDC PRIORITY 3007
INFO RUEKJCS/SECDEF WASHDC PRIORITY
RHEHAAA/THE WHITE HOUSE WASHINGTON DC PRIORITY
RUEAWJA/USDOJ WASHDC PRIORITY
RULSDMK/USDOT WASHDC PRIORITY
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RUEAIIA/CIA WASHDC PRIORITY
RUEKJCS/JOINT STAFF WASHDC//J5//
RHHMUNA/HQ USPACOM HONOLULU HI
RHHMHBA/COMPACFLT PEARL HARBOR HI
RHMFIUU/HQ PACAF HICKAM AFB HI//CC/PA//
RHMFIUU/USFJ //J5/JO21//
RUYNAAC/COMNAVFORJAPAN YOKOSUKA JA
RUAYJAA/CTF 72
RUEHNH/AMCONSUL NAHA 9346
RUEHFK/AMCONSUL FUKUOKA 6963
RUEHOK/AMCONSUL OSAKA KOBE 0632
RUEHNAG/AMCONSUL NAGOYA 5421
RUEHKSO/AMCONSUL SAPPORO 7559
RUEHBJ/AMEMBASSY BEIJING 2505
RUEHUL/AMEMBASSY SEOUL 8544
RUCNDT/USMISSION USUN NEW YORK 9092

UNCLAS SECTION 01 OF 19 TOKYO 000876

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: DAILY SUMMARY OF JAPANESE PRESS 03/31/08

INDEX:

(1) Prime minister appealing to public each and every day: Changes
his political approach as communication channel with Ozawa breaks
down (Asahi)

(2) Stopgap bill on tax measures, except roads tax rates, passed
through Lower House by majority from ruling coalition, DPJ
(Mainichi)

(3) Poll on Fukuda cabinet, political parties, road-related tax
revenues, BOJ chief nomination (Asahi)

(4) Poll on political, social attitudes (Asahi)

(5) MLIT to revise introduction of restriction on foreign investment
in airport operating companies; Experts council meeting to be held
possibly next month (Tokyo Shimbun)

(6) LDP Policy Research Chairman Sadakazu Tanigaki: No hesitation to
take second vote tax reform bill (Yomiuri)

(7) Opinion column by Atsuyuki Sassa: Wishing for a McCain victory
(Sankei)

(8) Defense Ministry to designate Nago City, Ginoza Village as
eligible for subsidies in return for bearing base-hosting burden
(Asahi)

(9) Ginowan City Assembly rejects "peace fund ordinance," creating
"barrier" for mayor before his visit to U.S.for direct appeal;
Persuasion of assembly essential (Ryukyu Shimpo)

(10) Defense Ministry panel recommends direct procurement, bypassing
trading houses (Tokyo Shimbun)

(11) Yokosuka slain taxi-driver case: Footage showing man resembling
U.S. deserter found in tapes on security cameras near Shinagawa
Station (Sankei)

ARTICLES:

(1) Prime minister appealing to public each and every day: Changes
his political approach as communication channel with Ozawa breaks
down

ASAHI (Page 2) (Slightly abridged)
March 31, 2008

Prime Minister Fukuda, facing difficulties in managing his
administration due to low public support rates and other setbacks,
has changed his political strategy from one of quietly anticipating
cooperation from Democratic Party of Japan (DPJ) President Ozawa to
directly and openly appealing his policy stance to the public.
Following an emergency press conference on March 27, during which he
revealed his decision to reallocate special-purpose road
construction funds for other uses in the fiscal 2009 budget, Fukuda
on the 29th and the 30th responded to a number of interviews and
appeared on TV programs. He will also hold a press conference on the
31st, the day when the provisional gas tax rate expires. He intends
to explain the government's response to the issue.


TOKYO 00000876 002 OF 019


Fukuda during an NHK program on the 30th gave the reason why he
revealed his new proposal regarding the special-purpose road
construction issue at a press conference before offering it to the
opposition camp: "I revealed to the public details to be discussed
between the ruling and opposition camps. Since time is running out,
I had no other means to take." He also said during a press
conference on the 27th: "I will not give up until the end. It is the
public that moves politics." Regular exchanges with between the
prime minister and reporters now take place twice a day. Fukuda
during those exchanges frequently asserts himself fluently,
criticizing the DPJ, a scene that has rarely been seen since he took
office as prime minister in September last year.

Behind the change in his approach is the breakdown of communications
with Ozawa. Based on the notion that things would not move in the
divided Diet without approval from Ozawa, Fukuda had secretly
maintained a "hot line" with Ozawa even after a grand coalition
initiative with the DPJ was derailed detQ-6~ng his power base in the ruling camp.

The ruling parties at the end of February railroaded the national
budget bill through the Diet. In the meantime, the DPJ disapproved
the ruling parties' proposal for promoting Deputy Bank of Japan
Governor Toshiro Muto to the governor's post. Their communications
seems to have been suspended from around that time.

The prime minister appears to think that the only way left for him
to take is to lure in the DPJ for policy talks by gaining wider
support for his policy through direct appeal to the pubic. He knows
Ozawa cannot bring DPJ members together and that the grand coalition
initiative has disappeared.

"Will not hesitate to submit censure motion against the prime
minister," says Kan

Deputy President Naoto Kan of the DPJ on March 30 gave a speech in
Niigata Prefecture. He during the speech criticized the LDP for
opposing an abolition of the provisional gas tax rate, "The LDP is a
force of resistance that does not reflect public opinion." Referring
to the determination of the government and the ruling parties to
adopt a bill aimed at maintaining the provisional rate by a
two-thirds majority, Kan played up his desire to force the
government to dissolve the Lower House over that issue. He said: "If
the ruling parties adopt the bill once again in the Lower House, the
issue of submitting a censure motion against the prime minister
would surface. We cannot afford to stop fighting until a new Lower
House is realized through dissolution of the Lower House and a snap
election."

(2) Stopgap bill on tax measures, except roads tax rates, passed
through Lower House by majority from ruling coalition, DPJ

MAINICHI ONLINE
March 31, 2008, 1:35 PM

The House of Representatives in its plenary session today adopted by
a majority from the ruling camp and the Democratic Party of Japan
(DPJ) a stopgap bill designed to extend to the end of May all
special taxation measures, with the exception of those related to
financing highway projects. The stopgap bill is expected to become
law after being adopted in a plenary session of the House of

TOKYO 00000876 003 OF 019


Representatives this afternoon. Since no prospects are in sight for
the government-sponsored bill amending the Special Taxation Measures
Law to clear the Diet, the ruling coalition and the DPJ decided to
extend other preferential tax measures than those tied to highway
projects as a step to avoid any impact on the daily lives of the
public. The provisional gasoline tax rate is to lose effect today.
On and after April 1, the tax rate on gasoline will be lowered by
25.1 yen per liter.

The stopgap bill was hastily submitted to the plenary session this
morning, after it was presented to the Lower House's Financial
Committee and its Executive Council as a chairman's proposal. The
bill includes such tax preferential measures as the reduced
registration license tax rates for the transfer of land ownership.
The ruling and opposition camps agreed on the 28th to pass the Diet
on the 31st, in response to a request from the heads of both Diet
chambers that confusion on the people's lives be avoided as much as
possible.

Meanwhile, the price of light oil will drop by 17.1 yen per liter
starting on April 1. The automobile acquisition tax will also be
reduced (from the current 5 PERCENT ) to 3 PERCENT .

If the amendment bill is not voted upon in the Upper House, the
ruling coalition will be able to force the bill through the Lower
House by using its two-thirds majority for a revote on or after
April 29, 60 days after the bill is sent to the Upper House, based
on a provision in the Constitution. The government and the ruling
camp plan to bring back the current higher gasoline and other
highway-related tax rates based on this provision.

(3) Poll on Fukuda cabinet, political parties, road-related tax
revenues, BOJ chief nomination

ASAHI (Page 2) (Full)
March 31, 2008

Questions & Answers
(Figures shown in percentage, rounded off. Figures in parentheses
denote the results of the last survey conducted Mar. 1-2.)

Q: Do you support the Fukuda cabinet?

Yes 31 (32)
No 53 (50)

Q: Which political party do you support now?

Liberal Democratic Party (LDP) 31 (29)
Democratic Party of Japan (DPJ or Minshuto) 20 (21)
New Komeito (NK) 3 (3)
Japanese Communist Party (JCP) 1 (3)
Social Democratic Party (SDP or Shaminto) 1 (2)
People's New Party (PNP or Kokumin Shinto) 0 (0)
New Party Nippon (NPN or Shinto Nippon) 0 (0)
Other political parties 0 (0)
None 39 (38)
No answer (N/A) + don't know (D/K) 5 (4)

Q: Prime Minister Fukuda has proposed incorporating gasoline and
other road-related tax revenues into the state's general account
budget so the revenues can be used for other purposes than road

TOKYO 00000876 004 OF 019


construction and other road-related infrastructure projects from
fiscal 2009. Do you support this proposal?

Yes 58
No 24

Q: Prime Minister Fukuda has also proposed maintaining the current
extra gasoline tax of 25 yen per liter in fiscal 2008 for road
construction and other road-related infrastructure projects, taking
the position that this is intended to avoid confusing local finances
and people's daily lives. Do you support this proposal?

Yes 31
No 55

Q: The DPJ rejected Prime Minister Fukuda's overtures, taking the
position that the current rate of additional taxation on gasoline
should be abolished right away from fiscal 2008. Do you support the
DPJ's rejection of Prime Minister Fukuda's overtures?

Yes 40
No 44

Q: The ruling and opposition parties failed to reach an agreement
over the gasoline tax. As a result, the gasoline tax will go down in
April. Do you think it is good to see the gasoline tax go down?

Yes 72
No 12

Q: The ruling parties are thinking of taking a second vote in the
House of Representatives in late April or later on a bill to restore
the current extra portion of taxation on gasoline because the
government will sustain a shortfall of tax revenues if the gasoline
tax is lowered. Do you support this restoration?

Yes 24
No 61

Q: The Diet has been in turmoil over the gasoline tax. Do you think
the government and ruling parties are more to blame for that, or do
you think the opposition parties are more to blame?

Government, ruling parties 22
Opposition parties 13
Both are equally to blame 59

Q: Prime Minister Fukuda first presented the Diet with his
nomination of a former administrative vice finance minister for the
post of Bank of Japan governor and next came up with his proposal to
appoint another former administrative vice finance minister.
However, both nominations were rejected in the House of Councillors.
As a result, the post of BOJ governor has been left unfilled. Do you
support Prime Minister Fukuda's actions?

Yes 18
No 58

Q: The DPJ rejected both nominations on the grounds that those who
were in the post of administrative vice finance minister are not
appropriate for the post of BOJ governor. Do you support the DPJ's
actions over the post of BOJ governor?

TOKYO 00000876 005 OF 019

Yes 33
No 47

Polling methodology: The survey was conducted Mar. 29-30 over the
telephone on a computer-aided random digit dialing (RDD) basis.
Respondents were chosen from among the nation's voting population on
a three-stage random-sampling basis. Valid answers were obtained
from 1,033 persons (64 PERCENT ).

(4) Poll on political, social attitudes

ASAHI (Page 8) (Full)
March 21, 2008

Questions & Answers
(Figures shown in percentage, rounded off. Bracketed figures denote
proportions to all respondents. One choice only for each question
unless otherwise specified.)

Q: To what extent are you satisfied with your daily life now?

Satisfied 8
Fairly satisfied 47
Rather dissatisfied 15
Dissatisfied 15

Q: In your heart, do you think you have a fullness in your daily
life?

Yes 37
No 60

Q: Generally speaking, do you think you are happy now?

Very happy 17
Fairly happy 62
Not very happy 17
Not happy at all 3

Q: Pick only one word that best fits today's society.

Stability 4
Equality 2
Freedom 6
Prosperity 1
Transition 5
Confusion 26
Gap 28
Egoism 21
Decadence 4
Isolation 1

Q: How are you getting along with your neighbors?

We are friends 27
We are nodding acquaintances 61
I don't know them very well 10

Q: How would you like to get along with neighbors?

More positively than now 11

TOKYO 00000876 006 OF 019


Just like now 86
Not so often like now 1

Q: Do you think there are more trustworthy people than untrustworthy
people in today's world?

More trustworthy people 24
More untrustworthy people 64

Q: How much do you trust the following?

Family
Trust 74
Trust to a certain extent 23
Don't trust very much 1
Don't trust at all --

Weather forecasts
Trust 14
Trust to a certain extent 80
Don't trust very much 5
Don't trust at all 1


Newspapers
Trust 17
Trust to a certain extent 74
Don't trust very much 7
Don't trust at all 1

Science & technology
Trust 21
Trust to a certain extent 65
Don't trust very much 8
Don't trust at all 1

Physicians
Trust 16
Trust to a certain extent 67
Don't trust very much 13
Don't trust at all 2

Court trials
Trust 11
Trust to a certain extent 61
Don't trust very much 23
Don't trust at all 3

Television
Trust 5
Trust to a certain extent 64
Don't trust very much 26
Don't trust at all 2

Police
Trust 9
Trust to a certain extent 54
Don't trust very much 29
Don't trust at all 6

Teachers
Trust 6

TOKYO 00000876 007 OF 019


Trust to a certain extent 54
Don't trust very much 31
Don't trust at all 6

Religions
Trust 8
Trust to a certain extent 22
Don't trust very much 33
Don't trust at all 35

Politicians
Trust 1
Trust to a certain extent 17
Don't trust very much 50
Don't trust at all 30

Bureaucrats
Trust 1
Trust to a certain extent 17
Don't trust very much 45
Don't trust at all 35

Q: Do you think most people are willing to help others, or do you
think most people think only of themselves?

Willing to help others 22
Think only of themselves 67

Q: Do you think Japan today is a society where people are rewarded
for their earnest efforts?

Yes 28
No 65

Q: Do you hold down your spending in your daily life now to prepare
for the future, or do you enjoy your daily life now instead of
preparing for the future?

Hold down my spending in my daily life now for the future 54
Enjoy my daily lives now rather than to provide for the future 34

Q: Do you feel uneasy about your future daily lives?

Yes 87
No 9


Q: (Only for those who answered "yes" to the foregoing question)
What is that?

My health 21(18)
Income, job 22(19)
Family 9(8)
Assets, such as savings 5(4)
Social security, such as pension 29(25)
Economic slump 8(7)
Accident, disaster 3(3)

Q: Which one would you like to count on in your old age: your own
ability or your public pension?

My own ability 42

TOKYO 00000876 008 OF 019


Public pension 46

Q: Do you take it for granted that children will take care of their
parents in their old age?

Yes 38
No 52

Q: What bonds a family together?

Family name, family register 2
Blood 33
Living together 18
Something moneywise 3
Something spiritual 39

Q: I in your family life, what would you like to have a little more
of?

Laughter 9
Conversation 19
Relaxation 15
Free time 7
Thoughtfulness 24
Parental authority 4
Home discipline 5


Q: Do you think Japan today is safe?

Yes 32
No 63

Q: Do you think it would be better to set up more security cameras
along shopping and residential streets to prevent crimes?

Yes 68
No 27

Q: Do you think that there are more trustworthy businesses in Japan
today than untrustworthy businesses?

More trustworthy businesses 29
More untrustworthy businesses 60

Q: To what extent do you think food products being sold in Japan are
reliable?

Almost all reliable 4
Somewhat reliable 63
Not very reliable 27
Almost all unreliable 3

Q: If you work at a food company, and if you happen to see or hear
that the company is falsifying best-before dates, what would you
do?

Nothing in particular 10
Consult with my supervisor or colleagues 70
Report it to the police or mass media 13

Q: Would you buy products again from a company once it loses trust

TOKYO 00000876 009 OF 019


over mislabeled or disguised products?

Yes 38
No 55

Q: What do you think is the most important attribute for a prime
minister to have?

Decisiveness 43
Intelligence 2
Passion 7
Foresight 22
Flexibility 5
Commonalty 11
Clean 3
International sense 3

Q: If you support a political party, what do you look for as the
most important aspect?

Principles, policy 34
Words, actions and image of its leader 7
Its lineup of lawmakers 3
Actual results, stability 20
Expectation it will change politics 30

Q: Do you trust national politics?

Trust very much 1
Trust somewhat 34
Don't trust very much 51
Don't trust at all 12

Q: Do you trust local politics?

Trust very much 3
Trust somewhat 46
Don't trust very much 41
Don't trust at all 8

Q: Do you think the government has been using taxpayers' money in an
effective way?

Very effective 1
Somewhat effective 11
Not very effective 47
Not effective at all 40

Q: On the whole, do you think your own local government has been
using taxpayers' money in an effective way?

Very effective 2
Somewhat effective 32
Not very effective 46
Not effective at all 15


Q: Would you like to take part in politics?

Yes 25
No 68


TOKYO 00000876 010 OF 019


Q: Who do you think have the most influence on Japan's politics?

Politicians 28
Bureaucrats 27
Business community 12
Mass media 17
People 13

Q: Are you conscious about law in your daily life, or do you think
about law in your daily life?

Often 14
Sometimes 49
Not very often 32
Not at all 4

Q: Do you think you must abide by the law in all cases?

Yes 62
No 33

Q: In order to maintain public order, which do you think plays a
greater role: "law and punishment" or "morality and ethics?

Law and punishment 11
Law and punishment to a certain degree 23
Morality and ethics to a certain degree 49
Morality and ethics 13


Q: By May next year, Japan will introduce a lay judge system under
which ordinary citizens will take part in criminal proceedings as
judges and hand down a ruling with court judges. Under this system,
judges will be selected at random from among people aged 20 and
over. If you are selected as a judge, would you like to take part as
a criminal judge?

Definitely yes 10
If possible, yes 26
If possible, no 43
Absolutely no 18

Q: Do you think you will be more trustful of court trials with the
introduction of a lay judge system?

Yes 23
No 69

Q: The heaviest punishment in Japan is the death penalty. Do you
think it would be better to abolish itt?

Yes 8
No 86

Q: Do you think more Japanese today are ill-mannered than in the
past?

Agree very much 63
Agree somewhat 30
Don't agree very much 6
Don't agree at all 1


TOKYO 00000876 011 OF 019


Q: Do you think Japanese are a people who watch their manners well?

Yes 28
No 64


Q: What do you think of as bad-mannered? (Multiple choices)

Not separating the trash (for recycling) 72
Talking on a cell phone in a bus or a train 68
Sitting down on sidewalks 68
Reading a newspaper in a crowded train 60
Eating and drinking in a commuter train 53
Smoking on the street 53
Putting on make-up in public 52
Looking at an adult magazine or the like in a bus or a train 42
Cuddling in public 37
Sending cellphone email in a bus or a train 17

Q: Do you think you are well-mannered when compared with others?

Well-mannered 27
Fairly well-mannered 63
Rather bad-mannered 6
Bad-mannered 0

Q: To what extent do you trust the education at elementary and
junior high schools?

Trust very much 6
Trust somewhat 68
Don't trust very much 21
Don't trust at all 2

Q: Do you think it is enough for elementary schoolchildren and
junior high school students to study at school, or do you think they
also should go to an after-school cram school?

It's enough to study at school 49
They should go to an after-school cram school 39

Q: Which opinion is close to yours?

It would be better in educating children to prioritize their hopes
since it is their lives 59
It would be better to educate children at their parents' discretion
because they don't have enough experience 30

Q: To what extent do you think the academic background is
important?

Very important 14
Somewhat important 63
Not very important 19
Not important at all 2

Q: There is a view that human beings will be happy as science and
technology advance. What do you think about this?

Agree very much 9
Agree somewhat 55
Don't agree very much 31

TOKYO 00000876 012 OF 019


Don't agree at all 3

Q: Would you like atomic power generation to be promoted as a source
of energy from now on?

Yes 40
No 35

Q: Would you like to see advances in genetic engineering of farm
products and animals for more food production?

Yes 25
No 59

Q: Would you like to see advances in genetic engineering of humans
for the treatment of diseases?

Yes 44
No 37

Q: What do you think further technological advances in the Internet,
cell phones, and other communication devices will do for human
relations?

Make them better 22
Make them worse 62

Q: Do you have a belief or creed of some kind?

Yes 23
No 70

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
341 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 in late
January and was sent back from a total of 2,369 persons before the
final deadline set at Mar. 6. Valid answers were from 2,336 persons,
excluding answer sheets left blank or filled out by those not
subject to the survey. The retrieval rate was 78 PERCENT . In the
breakdown of respondents, males accounted for 44 PERCENT , with
females at 56 PERCENT . In the breakdown of age brackets, persons in
their 20s accounted for 12 PERCENT , 30s-17 PERCENT , 40s-16 PERCENT
, 50s-20 PERCENT , 60s-16 PERCENT , 70 and over-19 PERCENT .

(5) MLIT to revise introduction of restriction on foreign investment
in airport operating companies; Experts council meeting to be held
possibly next month

TOKYO SHIMBUN (Page 2) (Full)
March 30, 2008

The Ministry of Land, Infrastructure and Transport (MLIT) on March
29 decided to start efforts to revise a plan for introducing a
restriction on foreign investment in major airports, including
Narita Airport, by setting up an experts study group within the
ministry as early as April. With the clashing of arguments pro and
con, the government and the ruling parties postponed a decision on
the issue until year's end. MLIT is now selecting panel members with
the possibility of involving businesspersons well versed in

TOKYO 00000876 013 OF 019


international capital markets, as well as security experts. The want
the review based not just on the views of those from the aviation
and transport sectors but also from those who are opposed to the
idea, arguing that such a restriction will hamper foreign investment
in Japan.

The envisaged study group would start over from discussions on the
propriety of regulating foreign investment, including a proposal for
applying the Foreign Exchange and Foreign Trade Control Law. Under
this law, the government can place restrictions on the application
of an article regulating foreign capital investment in airport
operating companies and the obtaining of stocks of companies with a
highly public nature by foreign companies -- neither of which was
incorporated in a bill amending the Airport Development Law.

As the major reasons for the postponement of the introduction of the
restriction this time, MLIT cited: (1) the view that it would be
easy to obtain understanding, because many in the ruling camp are in
favor of the introduction of the regulation was too lax; and (2) the
initial view that if a foreign company that gives priority to making
profits runs an airport operating company, airport services would
degrade came under criticism. The ministry admitted that the reasons
it had given were inconsistent with the stress it had given to the
security issue. Based on this realization, MLIT now intends to
cautiously undergo coordination with concerned government agencies
and the ruling parties in tandem with the study group.

(6) LDP Policy Research Chairman Sadakazu Tanigaki: No hesitation to
take second vote tax reform bill

YOMIURI (Page 4) (Full)
March 30, 2008

-- Prime Minister Yasuo Fukuda proposed integrating the special
account from road-related taxes into the general account.

Tanigaki: The prime minister presented a drastic proposal. The
Democratic Party of Japan's (DPJ or Minshuto) stance of rejecting
the prime minister's proposal is rigid. The DPJ has insisted that
the provisional gasoline tax should be immediately scrapped. But
scrapping the road-related rates would lead to tax revenue
shortfalls totaling about 2.6 trillion yen. Taking the finances of
local governments and confusion in the markets into account, the
(provisional tax rates should be maintained) the government drafted
in its tax reform bill for fiscal 2008.If holding revision talks
with the DPJ is difficult, we must be determined to revote on the
legislation in late April in the Lower House.

-- The prime minister said that he would allow the revenues from
road-related taxes to be used for other purposes even if the DPJ was
unable to agree with his proposal. Since he did not lay fully the
groundwork in the Liberal Democratic Party, the LDP was thrown into
turmoil.

Tanigaki: Since we are in such a critical situation, we are taking
action as adults.

-- It will be difficult (for the prime minister) to persuade LDP
road-policy specialists, who have opposed shifting the revenue from
road taxes to the general account.

Tanigaki: I think so. That is because we still need highways. We

TOKYO 00000876 014 OF 019


should consider how to secure fiscal resources in order to prevent a
negative impact on the finances of local governments.

-- How should the provisional gasoline rates be handled in the
future?

Tanigaki: The provisional tax rates should be retained. Japan has no
leeway to cut the rates when considering the present fiscal
situations of the central and local governments. But if the revenues
from road-related taxes are allowed to be used for purposes other
than road projects, we must discuss reasons for imposing the tax on
gasoline.

-- The prime minister had taken a political method of coordinating
views. But he made a top-down decision this time around. So some
members in the LDP are reacting sharply toward his top-down
decision.

Tanigaki: Under the present situation that the DPJ, which has the
initiative in the Upper House, has not made any wise concession, the
prime minister should have a free-hand. I think an ex post facto
explanation is necessary.

-- How will the LDP implement policies under the divided Diet?

Tanigaki: I don't know whom we should talk to in the DPJ. Given that
situation, we should use the article of the Constitution that allows
the Lower House to take a second vote on a bill that was rejected by
the Upper House when we need to do so. How about considering using a
joint committee of both Diet houses?

(7) Opinion column by Atsuyuki Sassa: Wishing for a McCain victory

SANKEI (Page 13) (Full)
March 28, 2008

Atsuyuki Sassa, first director of the Cabinet Security Affairs
Office

Media's biased way of reporting

It is obvious that the way the Japanese media are reporting on the
United States presidential election campaigns lacks fairness. From
the beginning, the Japanese media have taken it for granted that the
likely Republican nominee John McCain will lose because of the Bush
administration's failure in the Iraq war. Japanese dailies and TV
programs are eager to focus their reporting on this simple question:
Which will be chosen -- Hillary Clinton as the first woman president
or Barrack Obama as the first African-American president? McCain's
full name has rarely been seen in newspapers and on TV programs here
in Japan. He has been treated as if he were a minor candidate.

I wonder, however, whether McCain is a minor candidate. I don't
think that American democracy with a history of merely 200 years is
mature enough to easily accept a woman or black president. A
worst-case scenario for Obama would be there may be a radical
reaction to him down the road.

McCain is a WASP. He is the ruling Republican Party's likely
nominee. McCain took part in the Vietnam War as a pilot of
carrier-based aircraft, and he was shot down and captured. He later
became a hero lieutenant commander after surviving five and a half

TOKYO 00000876 015 OF 019


years of torture and maltreatment as a prisoner of war in North
Vietnam. He also has the experience of serving as a member of the
House of Representatives and as a senator. He also lost a
close-fought battle to George W. Bush in the 2000 Republican
presidential campaign. When a hard-bitten veteran politician,
McCain, has a showdown with the first female or black presidential
candidate in history backed by the Democratic Party, I wonder which
the American voters will choose at the last minute.

Japanese mass media, preconceiving that McCain will lose the
election, extensively cover the "Obama fever" that is getting steam
in Fukui Prefecture's Obama City. But I whether the way they are
covering it by giving it extensive space is appropriate.

Media need to give analytical report on candidates' policies

Although the presidential election in the U.S. is that of another
country, the outcome could greatly affect Japan, which is exposed to
a number of threats from China and North Korea, over the next four
years. Japan has been in effect shut out from the six-party talks
since it proposed to deal with the nuclear, missile, and abduction
issues together there. A most desirable scenario for Japan would be
that a candidate who sides with Japan will be elected as U.S.
president.

The Prime Minister's Official Residence (Kantei) and the Ministry of
Foreign Affairs (MOFA) refrain from making comments on any of the
candidates, because doing so would constitute interference in the
internal affairs of another country. But it is my belief that the
role of mass media is to at least give an analysis of each
candidate's policy toward Japan and China in light of Japan's
national interests and explain who will be the best in terms of
merits and demerits for Japan.

Judging from speeches by Clinton and Obama, their policies toward
Asia attach importance to China. They hardly mention Japan and the
Japan-U.S. alliance. If either were to win, I presume Japan-U.S.
relations would cool. Meanwhile, McCain, who is called a maverick,
stresses in his speeches the need to strengthen the Japan-U.S.
alliance, gives support to Japan's bid for a permanent seat on the
United Nations Security Council, raises opposition to Putin's
hegemonism, calls for strong diplomatic intervention, and emphasizes
the importance of resolving the abduction issue from a humanitarian
standpoint. McCain is the only politician in the Republican Party
who advocates environmental protection and the necessity of measures
to prevent pollution. Because he was a military officer with the
tough experience of war, he is realistic about the Iraq war.

I believe McCain is the person Japan needs to have as U.S.
president. He may be a second Theodore Roosevelt, who opposed the
Russian Empire's hegemonistic policy at the time of the
Russo-Japanese War 100 years ago.

McCain broad-minded enough to accept advice

The Taft-Katsura Agreement was signed in 1905, with Roosevelt being
supportive of Japan. By contrast, the present-day Bush-Rice-Hill
appeasement policy toward China and North Korea, which
preferentially allows China to put the Korean Peninsula under its
control, appears to be something opposite to that agreement.
Coincidentally, McCain cites Roosevelt as the politician he respects
most. If McCain wins, pro-Japanese Republicans, including Armitage,

TOKYO 00000876 016 OF 019


will come back to the official political scene. The vice president,
the secretary of state, the secretary of defense, and other key
officials for the White House and Pentagon may be chosen from among
those who attach importance to Japan.

On Jan. 8, 1990, as a former chief of the Cabinet Security Affairs
Office, I attended a meeting of high-level defense officials from
Japan and the U.S. held at the official residence of then Ambassador
to Japan Armacost and wrangled with McCain, who also jointed the
meeting as chair of the U.S. Senate Foreign Relations Committee.
McCain, who was short but had a tough and masculine face, sharply
criticized Japan's lack of efforts to defend itself. He even posed
this question to the Japanese side: "What if the U.S. Congress
resolves to abandon the Japan-U.S. Security Treaty?"

I then told McCain: "I am in support of the security treaty, but if
the U.S. notifies Japan it is scrapping it, Japan will then without
delay amend the Constitution introduced by General MacArthur and go
nuclear." McCain said, "Well, what do you think I should do?" I then
answered him bluntly: "Stay out of this matter." To my surprise,
McCain, who is known as a person of violent temperament, accepted my
impolite advice, saying, "That is a frank opinion. I'll do so." I
was struck by his broad-mindedness. Since then I have had a high
opinion of him.

(8) Defense Ministry to designate Nago City, Ginoza Village as
eligible for subsidies in return for bearing base-hosting burden

Asahi online (Full)
March 31, 2008, 1: 37PM

The Defense Ministry yesterday designated Nago City and Ginoza
Village in Okinawa Prefecture as municipalities eligible for
subsidies to be provided in return for accepting the base-hosting
burden accompanying the realignment of U.S. forces in Japan. The
ministry is expected to provide the two public entities with
subsidies for FY2007 and FY2008 in April or later.

On March 15, the environmental impact assessment started off Henoko
in Nago City in preparation for the construction of an alternative
facility to the U.S. Marine Corps Futenma Air Station. Given this,
the Defense Ministry now judges Henoko as fulfilling the condition
for receiving subsidies. The ministry had excluded Henoko from the
list of subsidy-recipient municipalities because of its opposition
to the government's relocation plan, but it has made a policy switch
in order to solicit the local community' cooperation for the
relocation plan.

(9) Ginowan City Assembly rejects "peace fund ordinance," creating
"barrier" for mayor before his visit to U.S. for direct appeal;
Persuasion of assembly essential

RYUKYU SHIMPO (Page 24) (Full)
March 31, 2008

By Yoko Shima, Ginowan

The Ginowan City Assembly (chaired by Kosuke Iha) in its regular
March session has voted down the city's proposal to establish a
"peaceful city creation fund ordinance." The municipal assembly had
already voted down twice the option of funding visits to the United
States (by the mayor). The assembly's latest decision has dealt an

TOKYO 00000876 017 OF 019


especially serious blow to Mayor Yoichi Iha, who was planning to
address the need to eliminate the dangerous nature of MCAS Futenma
and to visit the United States shortly by using the envisioned fund
composed of donations. The municipal government is considering a
visit to the United States (by Mayor Iha) in around July, which
requires the persuasion of the city assembly. Future developments
remain to be seen.

No additional financial burden

The envisioned ordinance was designed to place donations from within
and outside the city in the general account to use them in
disseminating information on the dangerous nature of Futenma Air
Station and in visiting the United States. The municipal government
proposed it as a step to address the base issue without placing an
extra financial burden on the city.

The approach of establishing a "donation ordinance" to allow a local
government to raise donations from around the country for specific
projects is now drawing much attention. Under the system, local
governments present policy options, such as natural conservation and
environmental measures, for prospective donors. Yasuoka Village,
Nagano Prefecture, known for its community-based services, is a
pioneer in this field. According to Japan Donation Market and
Company (based in Tokyo), 33 local governments have established such
ordinances. Strictly speaking, a donation ordinance does not apply
to Ginowan, where there is the only one option of disseminating
information on problems associated with Futenma Air Stations.
Nevertheless, it was epochal in the sense that people from within
and outside the city would be allowed to financially support the
municipal government's policy. The municipal government also
intended to play up the ordinance in anticipation of the
introduction of the so-called "hometown tax scheme."

Violation of safety standards

In fiscal 2005 and 2006, the Ginowan City Assembly rejected funding
visits to the United States by Mayor Iha, saying that requests must
be first made to the central government and that positive results
could not be expected. Iha was able to visit the United States in
fiscal 2005 owing to contributions from local residents. However,
the travel by the municipal workers who accompanied Iha to the
United States was not clqEA:#zl
business.

The municipal government has repeatedly pointed out that the
conditions of Futenma Air Station are more dangerous than those of
bases in the United States. The city obtained last year the MCAS
Futenma Master Plan specifying the establishment of airfield clear
zones where citizens' houses must not be constructed. Despite that,
the U.S. military has been allowing Futenma Daini (No. 2) Elementary
School and citizens' houses to continue existing within the clear
zones in violation of the U.S. safety standards. Mayor Iha is trying
to aim for the early return of MCAS Futenma by bringing the
violation of the U.S. safety standards to the attention of
Washington.

The city is even mulling legal action against the United States over
this issue. Before doing so, the city thinks it is necessary to
directly appeal to the U.S. Department of Defense and the Pacific
Command in Hawaii.

TOKYO 00000876 018 OF 019

The overwhelming view in the city assembly that voted down the fund
ordinance was that if a visit to the United States was necessary,
(donations) should be placed in the general account and (the mayor)
should persuade the city assembly first. The persuasion of the city
assembly lies as a task for Iha in his second term.

(10) Defense Ministry panel recommends direct procurement, bypassing
trading houses

TOKYO SHIMBUN (Page 2) (Full)
March 29, 2008

A procurement-reform panel in the Defense Ministry yesterday
finalized a set of recommendations on defense hardware procurement.
The report suggests directly procuring defense equipment from
foreign manufacturers, bypassing domestic trading houses. The panel
will submit the report to the government's Council on Defense
Ministry Reform to be called next week. The Defense Ministry will
implement the recommended measures one by one starting next fiscal
year.

A series of scandals have surfaced in connection with the
procurement of defense equipment from overseas, including a bribery
case involving former Administrative Vice Defense Minister Takemasa
Moriya and the padding of prices for overseas products by Yamada
Corp., a defense trading firm, and other trading houses. Reflecting
on these scandals, the Defense Ministry will carry out measures to
(1) ask manufacturers for estimates; (2) assign more procurement
experts overseas; and (3) double the penalties for padding bills.

The panel had studied the possibility of completely bypassing
trading houses, but it has now judged that in some cases,
procurement through a trading firm costs less, in terms of long-term
expenses, including costs for repairing and component replenishment.
The report advises the ministry to choose a cheaper means -- direct
procurement or procurement through a trading house. The report also
sets the goal of reducing the ministry's total spending by 15
PERCENT by FY2011 as a result of thoroughly slashing costs in the
process from development through retirement of equipment, for
instance, by introducing a package-procurement system.

Key points in reform of defense procurement
? Increase direct contacts with foreign manufacturers by checking
costs in advance, explaining the bidding process in English, and by
cultivating human resources.
? Establish a department responsible for the procurement of defense
equipment from overseas in April 2009.
? Increase the number of procurement experts stationed in the U.S.
from the current three to 10.
? Employ certified public accountants and former trading company
employees.
? Double the penalties for overcharging
? Incorporate in the contract a special provision to enable the
ministry to ask overseas manufacturers for estimates.
? Establish in April 2009 a department that administrates total
costs needed for developing, purchasing, and maintaining mainstay
equipment.
? Reduce total costs by 15 PERCENT below the level in FY2006 by
FY2011.

(11) Yokosuka slain taxi-driver case: Footage showing man resembling

TOKYO 00000876 019 OF 019


U.S. deserter found in tapes on security cameras near Shinagawa
Station

SANKEI ONLINE (Full)
March 31, 13:23

Through its investigations, the Yokosuka Police Station found
earlier today footage on a security camera near JR Shinagawa Station
showing a person resembling the 22-year-old U.S. sailor stationed at
the Yokosuka Naval Base who is now in the custody of the U.S. Navy
for desertion. JR Shinagawa Station is the place where Masaaki
Takahashi, 61, a Shinagawa Ward, Tokyo, taxi driver who was slain in
Yokosuka, Kanagawa Prefecture, was believed to have picked up his
last passenger.

The U.S. sailor has already hinted at his involvement in the case to
a friend. Before long, the Yokosuka Police Station's investigation
taskforce intends to formally request the U.S. military's
cooperation under the Japan-U.S. Status of Forces Agreement to allow
it to question the sailor as the primary witness, with the aim of
uncovering the complete details of the incident.

It has been found through the investigation that Takahashi picked up
his last passenger at around 7:30 p.m. on March 19 near JR Shinagawa
Station. The investigation taskforce has been conducting the
investigation, believing that the passenger fled the scene after
stabbing Takahashi over a payment dispute. The police have analyzed
tapes on security cameras near Shinagawa Station and found footage
showing a man believed to be the U.S. sailor.

SCHIEFFER

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