Cablegate: Japanese Morning Press Highlights 06/26/08

DE RUEHKO #1753/01 1780218
P 260218Z JUN 08




E.O. 12958: N/A



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

Diplomatic agenda:
4) President Bush in telephone conversation with Prime Minister
Fukuda stresses that U.S. will not forget the abduction issue
5) G8 Foreign Ministers Meeting today to focus on response to North
Korea's nuclear declaration (Tokyo Shimbun)
6) Government's plans to play up at the G8 Summit the dispatch SDF
personnel to Sudan as Japan's international contribution (Nikkei)
7) Secret emissary sent to Pyongyang by Baghdad last month prior to
nuclear declaration, possibly to ask for no mention of secret pact
between DPRK, Iran (Sankei)
8) METI Minister Imari suddenly visits Iraq, promises cooperation,
including technical training, to boost oil production (Nikkei)
9) Foreign Ministry set ups new China and Mongolia Division

10) IWC working group set up at annual meeting, but resistance
coming from Australia, anti-whaling groups (Sankei)

Economic agenda:
11) LDP scrutinizing harshly the government's draft set of economic
and fiscal policy guidelines (Tokyo Shimbun)
12) Government and ruling camp set to work on drafting a
supplemental budget (Yomiuri)
13) Prime minister's statements on tax increases shake up his party

Political agenda:
14) Democratic Party of Japan (DPJ) to end boycott of Diet and
return to session during the extraordinary session if only to pummel
the LDP on medical care, etc. (Nikkei)
15) Opposition to President Ozawa is building in the DPJ, spreading
across junior to mid-level lawmakers, who want a real party
presidential election in the fall (Mainichi)
16) LDP team, upset by the pub taxi scandal, to propose a freeze on
entertainment expenses by bureaucrats (Yomiuri)



Asahi: Sankei: Tokyo Shimbun
More than 1400 bureaucrats receive gifts from taxi drivers; 33

Government to allow unregistered children to be listed on resident

Eel trader paid 10 million yen in hush money to cover false

Top truck manufacturers raise prices of all models for first time; 3
PERCENT -5 PERCENT starting in August

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Not delivered today


(1) Shareholders meeting: Tensions generated with reappointments of
presidents voted down
(2) Papers on two Aegis duty officers sent to prosecutors: Are they
only crewmen responsible for accident?

(1) Goodwill to pull out of labor dispatch business: Protect
dispatched workers
(2) New strains of flu: Concrete measures needed

(1) Regular inspection of nuclear power plants: Balance safety with
(2) Use resourcefulness to develop bicycle that can carry two

(1) There are issues that are more important than regulating
convenience stores
(2) Prime minister should not slight Yanai report on security

(1) North Korea's nuclear declaration: Call for resubmission, if
(2) Goodwill to pull out of dispatch business: Serious warning to
labor dispatch business operators

Tokyo Shimbun:
(1) Carbon dioxide emissions measures set by Tokyo metropolitan
(2) Decentralization: Downsize local offices of central government

(1) Not delivered today

3) Prime Minister's Official Residence (Kantei)

Prime Minister's schedule, June 25

NIKKEI (Page 2) (Full)
June 26, 2008

Met at the Kantei with LDP Youth Section Head Inoue and Election
Campaign Department Head Shibayama. Later, met Deputy Foreign
Minister Sasae.

Met LDP Human Rights Research Council Chairman Ota. Followed by
Deputy Chief Cabinet Secretary Futahashi.

Met Futahashi.


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Met Futahashi.

Met Health, Labor and Welfare Ministry's Employment Security Bureau
Director General Ota. Met Asia Peace Contribution Center President
Haruo Nishihara.

Met Special Advisor Ito. Followed by Aged Society NGO Association
President Keiko Higuchi.

Underwent treatment by a dentist in Minami-Aoyama.

Dined with Tokyo University Professor Hiroshi Yoshikawa, chairman of
the Social Security National Conference, Special Advisor Ito, and
others at a Japanese restaurant in the Imperial Hotel.

Talked with U.S. President Bush on the phone at his official

4) U.S. will not forget abduction issue: Bush

SANKEI (Page 5) (Abridged)
June 26, 2008

Prime Minister Yasuo Fukuda had a telephone conversation with U.S.
President Bush yesterday evening and exchanged views on North Korea.
In the talks, Bush told Fukuda that he "will never forget" the
pending issue of Japanese nationals abducted to North Korea. Bush
added, "I fully understand Japan's concern, and the United States
wants to continue to cooperate closely with Japan." With this, Bush
reiterated what he told Fukuda during their meeting in November last
year, stressing that he remains committed to attaching importance to
the abduction issue. Fukuda said, "We're making utmost efforts in
our talks with North Korea to resolve various pending problems,
including the abduction issue, but I'd like to ask for the United
States' continued cooperation." Meanwhile, North Korea is expected
to declare its nuclear programs today. In this connection, Fukuda
noted that it is important to push ahead with the six-party process
of having North Korea abandon its nuclear programs.

The telephone conversation was held for about 20 minutes. The U.S.
government has indicated that it will inform the U.S. Congress of
its intention to remove North Korea from its terrorism blacklist. In
Japan, there has been a strong reaction to the idea of delisting
North Korea. Given this fact, Fukuda offered on June 24 to hold
talks with Bush over the telephone. Fukuda is scheduled to meet with
Bush on July 6 on the sidelines of the upcoming summit meeting of
Group of Eight (G-8) leaders to be held at Lake Toya in Japan's
northernmost main island Hokkaido.

5) G-8 foreign ministers meeting starts today, with focus on
response to North Korea's pending nuclear declaration

TOKYO SHIMBUN (Page 2) (Full)
June 26, 2008

A two-day meeting of the foreign ministers of the Group of Eight
starts today at the State Guesthouse in Kyoto. In the run-up to the

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G-8 summit in July, the ministers are expected to exchange views on
such subjects as North Korea's denuclearization, reconstruction
assistance to Afghanistan, and peace in the Middle East.

With Pyongyang expected to make a declaration on its nuclear
activities June 26, the participants are likely to discuss how to
proceed in pressing the North to steadily scrap its nuclear
programs. Japan intends to obtain the understanding and cooperation
of the G-8 member countries on an early implementation by the DRPK
of its pledge to reinvestigate the abduction issue, as promised in
recent bilateral working-level talks.

Foreign Minister Masahiko Koumura, in a separate meeting with U.S.
Secretary of State Condoleezza Rice on the afternoon of June 27, is
expected to ask Washington once again to proceed cautiously in
delisting North Korea as a state sponsor of terrorism in return for
Pyongyang's nuclear declaration.

As part of efforts of reconstruction assistance to Afghanistan, the
G-8 foreign ministers are expected to draw up a joint statement that
promises added assistance to the region bordering Pakistan, which
has become a breeding ground for terrorists.

Foreign Minister Koumura will meet separately with his British,
Italian and Canadian counterparts on the afternoon of June 26 prior
to the G-8 ministerial. The ministers meeting will be followed by
other events, including a meeting between the foreign ministers of
Japan and Australia, as well as a trilateral Japan-U.S.-Australia
strategic dialogue.

6) Government to dispatch SDF personnel to UNMIS headquarters in
Sudan to demonstrate eagerness for international contributions

NIKKEI (Page 2) (Full)
June 26, 2008

The government has decided to dispatch several Self-Defense Force
personnel to the Headquarters of the United Nations Mission (UNMIS)
for peacekeeping operations (PKO) in southern Sudan. Prior to the
Group of Eight Summit (Lake Toya Summit) starting on July 7, which
Japan will chair, the government aims to demonstrate its eagerness
for international contributions. The plan will be announced next
week. The government is also mapping out measures of reconstruction
assistance in Afghanistan. It intends to hurriedly work out

These plans are part of Prime Minister Yasuo Fukuda's promise to
make Japan a "peace cooperation state." The government plans to
dispatch two SDF personnel to UNMIS in August or later. It intends
to dispatch an advance team composed of officials of the Foreign
Ministry, the Defense Ministry, and other relevant government
agencies to Sudan in July.

The UNMIS Headquarters in Khartoum is a core unit tasked with
controlling all squads. The SDF personnel to be dispatched there are
expected to engage in coordinating activities by more than 70
countries participating in the mission. The duties to be performed
by UNMIS include having refugees return home and removing land
mines. The government is also keeping in mind the possibility of
dispatching a full-scale unit to UNMIS in Sudan in the future.

The Foreign Ministry, eager to send SDF personnel to join PKO in

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southern Sudan from the beginning, has dispatched the senior vice
foreign minister and a parliamentary minister to collect information
there. In the Defense Ministry, many officers initially voiced
caution about the dispatch plan out of concern for security, but
they appear to have changed their minds about it, with an eye on the
upcoming Lake Toya Summit, in which African development will be high
on the agenda.

On reconstruction assistance in Afghanistan, the government's
fact-finding team consisting of representatives from the Cabinet
Secretariat, the Foreign Ministry, and the Defense Ministry visited
the nation on June 8-18. The group had a first-hand look at the
activities of the North Atlantic Treaty Organization's (NATO)
International Security Assistance Force (ISAF) in Kabul, the capital
of Afghanistan, and other places.

Chief Cabinet Secretary Nobutaka Machimura, Foreign Minister
Masahiko Koumura, and Defense Minister Shigeru Ishiba met yesterday
to discuss the dispatch plan, based on the results of the team's
visit to Afghanistan. But one of the participants said: "We have yet
to determine any specific direction."

As specific assistance measures for Afghanistan, the government has
in mind logistic support for ISAF and participation in the
Provisional Reconstruction Team (PRT). To implement these measures,
however, new legislation will become necessary. Foreign Minister
Koumura said in a speech on June 24: "We must fully consider whether
new legislation will be adopted under the current Diet situation."

7) Iran gagged N. Korea

SANKEI (Page 2) (Full)
June 26, 2008

WASHINGTON-North Korea is expected to declare its nuclear programs
today under an agreement reached at the six-party talks over its
nuclear issue. In this connection, a special envoy from Iran visited
North Korea in late May and asked North Korea not to touch on
cooperative ties with Iran over nuclear development. In return, Iran
promised more jobs for North Korean workers, including positions as
nuclear scientists. This was revealed by an intelligence source with
expertise on the Korean Peninsula.

According to the source, the Iranian envoy is a high-ranking
intelligence official. An official older than the high-ranking
official was initially to have visited North Korea from Iran's
Revolutionary Guard, a crack unit rumored to be taking part in
nuclear development. However, this official fell sick. This is why
Iran sent the intelligence official to North Korea instead.

Iran also sent a delegation to Pyongyang in February this year. On
that occasion, the Iranian delegation asked North Korea not to
unveil its cooperative ties with Iran to the United States. The
Iranian envoy's visit to North Korea this time was in response to a
provisional agreement reached between the United States and North
Korea in April.

According to the source, the Iranian envoy in North Korea met with a
high-ranking official for North Korea's nuclear policy. In that
meeting, the envoy praised North Korea for its "brave attitude" of
not caving in to the United States' pressure for a "complete and
correct declaration" of North Korea's nuclear programs in this

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April's talks between the United States and North Korea. In the
provisional agreement, North Korea went no further than to word its
"awareness" of concerns in the United States and other countries
about its nuclear programs through proliferation and uranium
enrichment. The envoy stressed that it was "an achievement for both
North Korea and Iran."

The Iranian envoy also told Pyongyang that Iran would accept more of
North Korea's nuclear engineers and experts who want to work in Iran
as a measure in return for North Korea's cooperation with Iran. At
the same time, the envoy also promised to hire them for a long
period of time, according to the source.

North Korea is now in the process of disabling its nuclear facility
in Yongbyon. Meanwhile, North Korea can secure jobs for its nuclear
engineers and others. Moreover, it will be possible for North Korea
to maintain its technological capability for nuclear development.

The Iranian embassy in Japan released a comment, saying: "The
Iranian Embassy strongly denies such a rumor. At the same time,
Iran's nuclear technology for peaceful purposes-which is under the
International Atomic Energy Agency's complete inspection-is
developed by Iran's engineers, and we again stress that in this area
Iran has no cooperative ties with any foreign countries at all.
Several foreign sources spread falsehoods about relations between
Iran and North Korea in an aim to confuse relations between Iran and
Japan. We regret that the media carries articles about such

8) METI minister in Baghdad promises to help Iraq increase oil

NIKKEI (Page 1) (Full)
June 26, 2008

Minister of Economy, Trade and Industry Akira Amari, now visiting
the Middle East, suddenly visited Baghdad, the capital of Iraq, on
June 25 and met Prime Minister Nouri al-Maliki, Oil Minister Hussain
al-Shahristani, and other Iraqi government officials in succession.
In the meetings, both sides agreed on the importance of revitalizing
the Iraqi oil industry, which was seriously damaged in the Iraq war,
as well as the increase of oil output as part of efforts to
rehabilitate its economy. The two countries issued a joint statement
specifying Japan's promise to cooperate in training engineers and
constructing infrastructure. By offering assistance to Iraq, which
has the world's third-largest oil reserves, Japan is also aiming to
curb oil price hikes.

Amari left Kuwait for Baghdad on the morning of the 25th, local
time, by a Self-Defense Force C-130 transport plane and stayed there
for about seven and a half hours. He is the second cabinet minister
to visit Iraq since the end of the Iraq war, following then Foreign
Minister Taro Aso in August 2006.

To advance the reconstruction of Iraq, both sides agreed on the need
to deepen wide-ranging bilateral economic cooperation mainly in the
energy area. The two sides also shared strong concern about the
negative effect of recent soaring oil prices on the world economy
and developing countries.

As measures to train oil and natural gas engineers, Japan promised
to accept 100 trainees annually for five years starting in 2009.

TOKYO 00001753 007 OF 012

Amari also indicated a willingness to continue extending up to 3.5
billion dollars in yen loans to reconstruct Iraq, including
infrastructure construction as a measure to resuscitate its oil

9) Name of China Division to be changed to China and Mongolia

SANKEI (Page 5) (Full)
June 26, 2008

The name of the China Division of the Foreign Ministry's Asian and
Oceanian Affairs Bureau will be changed on June 27 to the China and
Mongolia Division. The purpose of the change is to show Japan's
stance of placing emphasis on Mongolia, a friendly country, in
addition to matching international standards. The government will
issue an ordinance and the Foreign Ministry's decision will come
into effect the same day. Some have contended that it is not
consistent because the China Division is in charge of China,
Mongolia, and Taiwan.

In his telephone talks January last year with then Prime Minister
Shinzo Abe, Mongolian President Nambaryn Enkhbayar expressed support
for Japan's bid for a nonpermanent seat on the United Nations
Security Council, withdrawing his country's bid for a nonpermanent
UNSC seat. With this, Japan will likely win a seat in the election
this fall. Mongolia reportedly was pleased with the Japanese
government's decision, with one official saying: "Our long-cherished
dream has been realized."

However, the China Division has identified itself internationally in
English as the "China and Mongolia Division." But it is called in
Japanese, the "China Division" because pro-China politicians opposed
the idea of changing the name, according to a Foreign Ministry

It is said that some ruling coalition members were concerned that
the change might irritate China. China, meanwhile, appears to be
indifferent, with one official saying: "That's Japan's internal

10) IWC agrees to set up coastal whaling working group: Australia,
antiwhaling groups stunned by unexpected move

SANKEI (Page 6) (Excerpts)
June 26, 2008

The International Whaling Commission (IWC) at its 60th plenary
meeting in Santiago, Chile, agreed to set up a working group for
discussion of key issues regarding which concessions cannot be
expected due to conflict among member nations. Censure resolution
submission matches and threats of secession have been usual scenes
at IWC plenary meetings. This time, however, the meeting has been
going unusually quietly. With "normalization" as the keyword, no
resolutions or motions have been submitted. Members of delegations
and nongovernmental organizations, which have been harshly
criticizing Japan, were stunned by the outcome.

The Australian delegation is critical of Japan's research whaling
and sympathetic toward radical protest activities by environmental
groups. Environment Minister Peter Garrett is taking part in the

TOKYO 00001753 008 OF 012

meeting from Australia.

Garrett is a former vocalist of "Midnight Oil," a popular Australian
rock band. He has many fans. He is highly interested in
environmental protection. He was first elected as a lawmaker in 2004
and became the environment minister of the Rudd administration,
which was inaugurated in 2007.

Garrett in an interview before leaving for Santiago said
flamboyantly: "I will never, ever make a compromise with Japan. It
is impossible for me to make concessions and allow it to kill
whales, even if it's a few."

However, most participating countries supported the chairman's
management policy calling for an agreement instead of taking a vote.
Participants also agreed to establish a working group for
normalization aimed at finding a breakthrough in the stalemate
through comprehensive talks on confrontational issues joined by a
small number of persons. This has even generated the atmosphere of a
thaw at the meeting.

Garrett, left to fend for himself, stressed: "We are now at the
threshold of a constructive discussion. We are not going to make a
deal. There is no change in our policy of making no compromise with
Japan." However, reporters responded skeptically, with one saying,
"Perhaps you should face facts. Japan will never compromise unless
it gets something in return."

Glen Inwood, a staff member of the Institute of Cetacean Research
who serves as the Japanese government's spokesman responsible for
the foreign media, made an acrimonious remark: "Most member nations
have come to Santiago with the determination to do something with
the IWC, which is on the brink of collapse. Mr. Garrett has come
with yet another new demand. He may be under some kind of

11) After stormy developments, LDP decides to leave draft 2008 basic
economic and fiscal reform policies to Tanigaki; Matter likely to
rekindle during budget compilation

TOKYO SHIMBUN (Page 2) (Abridged)
June 26, 2008

The Liberal Democratic Party Policy Research Council yesterday
discussed a draft of 2008 basic policies for economic and fiscal
reform compiled by the government. Although the meeting erupted with
fierce opposition to the policy to reduce social security expenses
by 220 billion yen annually, council chairman Sadakazu Tanigaki
managed to obtain the council's approval to leave the matter to him
in the end. The government intends to adopt it at a cabinet meeting
on June 27 after it is finally approved by the LDP General Council
on the 26th. A renewed pitched battle is certain to take place over
reducing spending during budget compilation.

In the meeting, Tanigaki came under fire, with some members saying,
"You are at the beck and call of the Finance Ministry," of "If this
situation persists, Japan will sink."

The draft specifies that the government will cut spending as deeply
as possible. The draft is specifically designed to reduce social
security spending by 1.1 trillion yen over five years from fiscal
2007 and to trim down public works. The draft had been presented to

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a Policy Research Council meeting on June 24, but meeting with
strong objections, it failed to win its endorsement.

In yesterday's meeting, many members, mostly health and welfare
policy specialists, raised objections to the draft, citing
financially strapped local districts and the next Lower House

Tanigaki asked the members to leave the matter to him, saying that
trimming spending as much as possible is Prime Minister Fukuda's
policy. But health and welfare policy specialists still insisted on
revising the draft to keep social security spending intact. This
prompted Tanigaki's deputy Hiroyuki Sonoda to propose carrying their
discussion over to the upcoming budget compilation, thereby
convincing the members to leave the matter to Tanigaki for now.

After the meeting, Health, Labor and Welfare Division chief Seiichi
Eto indicated to reporters that he would continue opposing the draft

The prime minister, too, expressed to the press his intention to
uphold the reduction policy.

12) Government and ruling camp planning to compile supplemental
budget, aiming a building internal solidarity; DPJ expected to join

YOMIURI (Page 4) (Excerpts)
June 26, 2008

The government and the ruling parties have decided informally to
present to the extraordinary session of the Diet that opens in late
August a supplemental budget for fiscal 2008 that would contain such
outlays as measures to counter soaring oil prices and measure to
restore the areas in Iwate and Miyagi devastated by the earthquake.
The decision reflects alarm that with soaring oil prices, the lives
of the people have been greatly affected, so unless something is
done immediately to alleviate the situation, it could lead to a
further destabilization of the Fukuda administration.

This time, the compilation of the supplemental budget will be under
the lead of the ruling parties. The Liberal Democratic Party's (LDP)
and New Komeito's policy research council heads, Tanigaki and Saito,
respectively, on the 24th met with Chief Cabinet Secretary Machimura
and pointed out the need for compiling a supplemental at the time of
presenting a set of measures to counter rising oil prices. Machimura
reportedly indicated he would study such in association with the
package of measures to deal with the natural disaster.

13) Prime Minister Fukuda's remarks about consumption tax confuse
and shake up the ruling camp, disappointing those favoring a tax

MAINICHI (Page 2) (Excerpts)
June 26, 2008

Prime Minister Yasuo Fukuda has been wavering back and forth in his
remarks about raising the consumption tax. In an interview on June
17 to news companies of G-8 countries, he took a forward-looking
stance, saying, "It's time to make a decision," but on his press
conference on the 23rd, he retreated, only saying, "I was thinking
in long units, such as two or three years." The prime Minister, who

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already has lost momentum in fiscal reconstruction and suppressing
expenditures, has now irritated the ruling camp, prior to the
drastic tax-reform exercise this fall.

"It would be better not to heat up the issue." The prime minister
made this remark at a cabinet meeting on the 24th, driving the point
home so that the ruling camp would not overreact to his consumption
tax remark. He has let his aides know that he did not want anybody
to talk about the consumption tax in August. The prime minister's
latest remark has been taken a retreat by the LDP, but former Chief
Cabinet Secretary Yosano could not conceal his disappointment. But
former Secretary General Hidenao Nakagawa, who is cautious about
raising taxes, told his aides, "The debate about raising the
consumption tax has generally peaked."

14) Calls growing in DPJ to swiftly return to deliberations in next
extra Diet session in order to pursue government over medical
insurance system for elderly and other matters

NIKKEI (Page 2) (Excerpts)
June 26, 2008

In the closing stage of the previous regular Diet session, the major
opposition Democratic Party of Japan boycotted Diet deliberations.
Many in the party are voicing their eagerness to return swiftly to
deliberations the in the next extraordinary Diet session that is
likely to open in late August. The reason is that in order to
realize President Ichiro Ozawa's plan to force the prime minister to
dissolve the Lower House for a snap general election in the fall or
beyond, it is essential to pursue the government in Diet
deliberations on such issues as the medical insurance system for
people 75 and older and the reform of road tax revenues. A plan has
also cropped up to conduct deliberations right from the beginning of
the upcoming Diet session after talks between the ruling and
opposition camps.

In an interview with Nikkei, Deputy President Naoto Kan said:
"Absurdity has deepened (since the previous Diet session) over such
issues as the medical and pension systems and bureaucrat-initiated
bid-rigging scandals. It is important to discuss such issues, and
they must be dealt with flexibly."

In the last Diet session, the DPJ totally gutted deliberations after
Prime Minister Yasuo Fukuda effectively ignored the adoption by the
Upper House of a censure motion against him. A hard-line stance was
dominant in the DPJ leadership.

But even after deciding to boycott deliberations, the DPJ continued
attending sessions to discuss disaster countermeasures and the
abduction issue as exceptions from a humanitarian viewpoint. After
the previous Diet session closed, Secretary General Yukio Hatoyama
said in a softer tone, "It is necessary to deal with matters
flexibly in consideration of public opinion."

On the night of June 23, Ozawa instructed Hatoyama to consult
closely with the Upper House regarding future Diet affairs. They
also confirmed a policy of making decisions after closely watching
the trend of public opinion.

15) Junior, mid-level DPJ lawmakers looking for rival candidates
against Ozawa for party leadership race

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MAINICHI (Page 5) (Excerpts)
June 26, 2008

Prior to the September presidential election, groups in the main
opposition Democratic Party of Japan (DPJ), including one led by
former President Seiji Maehara, will hold study group sessions
starting today. It seems that most party executive members and many
DPJ lawmakers want to carry out a smooth election, reelecting Ichiro
Ozawa so that he will lead the party until the next House of
Representatives election. However, groups of junior and mid-level
lawmakers, having distanced themselves from Ozawa, are trying to
find rival candidates against the incumbent president. They are
aiming at holding a full-fledged election by letting party members
and supporters take part in the election for the first time in six

The group called Ryoun-kai, headed by Maehara, will hold a study
group session on June 26-27 in Kiso Town, Nagano Prefecture. The
Maehara group will work out a strategy for the party leadership
race, inviting Kozo Watanabe, a supreme advisor to the party, as a
lecturer to the session. The group is in favor of fielding other
candidates besides Ozawa, arguing that they cannot hold policy
debate under Ozawa's leadership. Maehara, however, has remained
silent since writing an article for a monthly magazine in which he
challenged Ozawa along policy lines, caused a major fuss in which
e-mails criticizing Maehara were sent to all his group members. A
person close to Maehara said: "The article will serve as the policy
platform for the leadership race. Since he has no intention to run
in the election, he wanted to come up with constructive statements."
But a different group member said: "His stance of facing down Ozawa
is too strong, so it is difficult to win middle of the road members
over our side." There is a party rumor that Yoshito Sengoku and
Yukio Edano may become candidates.

The group called Kasei-kai, led by Public Relations Committee
Chairman Yoshihiko Noda, will hold a study session on July 2-3 at a
hotel in Odawara, Kanagawa Prefecture. Many in the group believe
that the party needs a leadership election, in which candidates talk
straightforwardly about the future of Japan. Yesterday, Noda and his
followers got together in the Diet to prepare for the session.
Attention is on whether Noda will express his intention to run in
the presidential election.

16) LDP group proposes suspending entertainment expenditures for

YOMIURI (Page 4) (Full)
June 26, 2008

The Liberal Democratic Party's (LDP) project team to stop the
wasteful use of tax money (chaired by Senior Secretary General
Hiroyuki Sonoda) decided yesterday to call on the government to
suspend all entertainment expenditures for the ministries and
agencies in the budget for fiscal 2008. The team will seek
abolishment in principle in compiling a budget for fiscal 2009.
Coming up with a set of proposals in early next week, the group will
present it to the government.

Entertainment expenditures for civil servants of the central
government are disbursed from the welfare budget for health
promotion and benefits of personnel. It has been discovered that
some agencies spent tax money to purchase massage chairs and to hold

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bowling contests. These practices came under heavy criticism.

The LDP team has judged that it is unnecessary to disburse funds for
entertaining expenses and decided to freeze the budget for such use
this fiscal year.


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