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Cablegate: Daily Summary of Japanese Press 07/02/08

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RUYNAAC/COMNAVFORJAPAN YOKOSUKA JA
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RUEHBJ/AMEMBASSY BEIJING 4208
RUEHUL/AMEMBASSY SEOUL 0198
RUCNDT/USMISSION USUN NEW YORK 0611

UNCLAS SECTION 01 OF 08 TOKYO 001821

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 07/02/08

INDEX:

(1) Cover-up of lost USB memory device highlights uniformed group's
nature to keep information to themselves (Mainichi)

(2) DPJ drafts "Okinawa Vision" that aims at relocating Futenma
outside of Japan (Mainichi)

(3) Yokosuka wavering over U.S. nuclear flattop's deployment
(Nikkei)

(4) North Korea already eyeing "next return," keeping nuclear card
in hands (Nikkei)

(5) Editorial: SDF dispatch to Sudan -- Unreasonable PKO principles
should be reviewed (Sankei)

(6) Heisei Period version of Maekawa Report proposes reduction of
burden on young people (Mainichi)

ARTICLES:

(1) Cover-up of lost USB memory device highlights uniformed group's
nature to keep information to themselves

MAINICHI (Page 3) (Abridged slightly)
July 2, 2008

The Ground Self-Defense Force (GSDF) lost a USB flash memory device
(in February 2007) that contained data on a joint Japan-U.S.
exercise, but the GSDF covered up that fact. The incident exposed
the Ministry of Defense's (MOD) nature to keep information within
uniformed circles and not to inform the "suits" (civilian internal
bureaus). Despite the principle of civilian control over the
military, cover-ups have been seen in the pas tht even leave the
defense minister out of the loop. The USB incident is likely to cast
a pall over the discussion of the government's Council on Reform of
the Defense Ministry.

"Nothing has changed since the Maritime Self-Defense Force
underreported the fuel Japan supplied to a U.S. supply ship," a
senior civilian official complained recently.

On May 9, 2003, then Chief Cabinet Secretary Yasuo Fukuda explained
that the MSDF had provided about 200,000 gallons of oil to a U.S.
oiler in the Indian Ocean. Masayoshi Teraoka, then director of the
Maritime Staff Office's Plans and Program Division, knew the correct
amount was 800,000 gallons, but he did not report it to then Defense
Agency Director-General Shigeru Ishiba.

In February 2007, the GSDF Middle Army headquarters in Itami, Hyogo
Prefecture, made a big fuss over the loss of the USB memory device.
The device did not turn up even though the criminal investigation
command searched for it. The Middle Army headquarters knew about the
loss all along, but the incident did not reach the ears of civilian
officials for a long time.

The SDF remains reluctant to disclose information.

Doubts emerged about the amount of oil from the U.S. Navy's
announcement on May 6, 2003, that its oiler received 800,000 gallons
of fuel from Japan. According to an MOD interim report, released in

TOKYO 00001821 002 OF 008


October 2007, Teraoka said: "I thought there was no need to correct
the amount because the matter fairly subsided (in the three days)."
The government denied the diversion of Japanese fuel by the US
military for use in the Iraq theater based on the 200,000 gallons of
oil. Correcting the amount to 800,000 gallons would have destroyed
that ground. To the MOD, forming public opinion was clearly more
important than telling the truth.

Ryoichi Oriki, GSDF chief of Staff and then Middle Army commanding
general, said to a Mainichi reporter yesterday: "Information in the
question is not so vital. Keeping it secret is not really a
problem." Another uniformed officer also said: "It was not a
cover-up. The Mainichi Shimbun exaggerated the matter."

Defense Ministry spokesman Katashi Toyota in a press conference
yesterday admitted that the Ground Staff Office had not informed the
United States of the loss of the USB device, adding, "It was not
classified as secret."

Hearing such comments, a civilian official said: "If the data are
not vital, they should be made public." Another official took this
view: "The problem is that the USB memory device has not been found.
It might have been sold through illegal channels."

Views between the uniformed group and the civilian group are wide
apart. An investigative report on the incident in which the GSDF
covered up the fact that a colonel had allowed his friend to fire a
machine gun notes an agreement between the Eastern Army headquarters
and the Ground Staff Office not to inform the internal bureaus of
the incident.

Comment by Sophia University Professor Yasuhiko Tajima: Some
military information must not be made public. The GSDF said that the
data on the joint Japan-U.S. exercise would not put the general
public at risk. If so, the force should have disclosed the loss of
the memory device right away. The incident might promote the trend
of secrecy that has been growing since 9/11. Having been upgraded to
ministry status, the Defense Ministry is required to play a grater
international role and to open it up further. Despite that, the
ministry appears to be closing itself off to the outside, saying,
"The military sector is different."

Military commentator Kazuhisa Ogawa: Misconducts by SDF personnel,
including the latest loss of the USB memory device, must be
disclosed 100 PERCENT . In national contingencies, the SDF cannot
fight without public trust. The lost device is filled with vital
military data, and a decision must be made accordingly on whether to
disclose them. A closed committee must be established at the Diet to
discuss the propriety of disclosing such data. Making a decision at
the level of the person responsible for the organizational runs the
risk of resulting in a cover-up.

Impact on MOD reform council inevitable

Chief Cabinet Secretary Nobutaka Machimura in a press conference
yesterday said: "The SDF must clearly realize the importance of
information on national defense. I think the incident will be
referred to in the final report to be produced by the government's
Council on Reform of the Defense Ministry."

The council was launched last December at the order of Prime
Minister Fukuda with the aim of reforming the MOD under the

TOKYO 00001821 003 OF 008


leadership of the Prime Minister's Official Residence (Kantei).

Concluding that the leaked data are of low importance, MOD officials
indicated that their impact would be limited.

Nevertheless, MOD reform is underway in the wake of a series of
misconducts by SDF members, such as a leak of classified Aegis data
and the outflow of defense information via the Winny file-sharing
software. Establishing a solid information security system is one of
the council's top priorities. The latest incident is certain to have
an impact on the council's effort to draw up its report.

The council is mainly discussing whether to keep the three SDF staff
offices by integrating them with the internal bureaus or to
establish mixed units of personnel from both civilian and uniformed
staff by reorganizing their functions into three major components:
defense capability buildup, operations, and policy and
accountability for the pubic. The council has conducted discussion
and is now on track for keeping the four staff offices in place and
establishing some mixed units of persons from the Defense Ministry
and the SDF based on Defense Minister Ishiba's proposal.

Although the council chiefly has high-level classified information
in mind, the information involved in the latest incident is in the
category of "handle with care," a leak of which is not subject to
any criminal charge. The theft of recording media, such as a USB
flash memory device, within the organization was not expected.

Given the situation, such matters as the handling of information
whose definition is uncertain and the improvement of the morals of
SDF personnel are expected to remain on the table for discussion.
With the approach of the next extraordinary Diet session, in which
an extension of the MSDF's refueling operation in the Indian Ocean
is likely to take center stage, the government will be pressed for a
cautious response.

(2) DPJ drafts "Okinawa Vision" that aims at relocating Futenma
outside of Japan

MAINICHI (Page 6) (Full)
Eve., July 2, 2008

A draft revised version of the Democratic Party of Japan's (DPJ)
"Okinawa Vision," which will become the party basic policy toward
that prefecture, starting with the issue of U.S. military bases, was
revealed today. The vision includes a draft revision of the
Japan-U.S. Status of Forces Agreement (SOFA), the compilation of
which was set off by a string of crimes by U.S. military personnel
in Okinawa and other parts of Japan. Regarding the U.S. Marine
Corps' Futenma Air Station (Ginowan City), the vision states: "We
should look for a way to relocate it outside the prefecture, and in
view of the changing strategic environment, aim for relocation
outside of Japan." The vision will be included in the party's
manifesto (campaign promises) for the next Lower House election.

The original version of the vision was written in August 2005, but
it was decided to revise it based on consideration of such factors
as the Japan-U.S. agreement to relocate Futenma Air Station to the
coastal portion of Camp Schwab (Nago City) and to move Marines
stationed in Okinawa to Guam. The draft revised version will be
formally adopted on July 8 at a meeting of the party's shadow
cabinet, the Next Cabinet.

TOKYO 00001821 004 OF 008

Revisions of the SOFA that were compiled jointly by the DPJ with the
Social Democratic Party and the Peoples New Party in April were
included as is. The revisions specifically include: 1) handing over
crime suspects to police authorities prior to indictment, a
procedure now carried out under an improved application of the SOFA;
2) requiring the U.S. to return to the original state base land that
is environmentally damaged; 3) a ban on low-altitude flights; and 4)
registering as foreigners those persons connected with the U.S.
military who are living off base. The vision states: "a drastic
revision is to be implemented at once."

On the Futenma issue, the vision stresses that the base should be
relocated either outside the prefecture or outside the country,
noting, "Although an environmental impact assessment has begun, the
situation has reached a deadlock." On the moving of F-15 training
flights away from Kadena Air Base, which is being promoted as a
measure to lighten the burden on Okinawa, the vision calls for other
measures, such as moving the flight zone, "in which the noise damage
has not at all been alleviated."

DPJ President Ozawa on June 26 in a press conference at Naha City
pointed out the inequality of the SOFA, saying, "The current
relationship between Japan and the United States cannot be called an
alliance." He stated: "Once we are in political power, I would like
to create a truly equal Japan-U.S. alliance. In so doing, I am
thinking of measures to resolve the SOFA problem and various issues
related to the stationing of U.S. forces in Japan."

(3) Yokosuka wavering over U.S. nuclear flattop's deployment

NIKKEI (Page 43) (Full)
June 30, 2008

The city of Yokosuka in Kanagawa Prefecture will be the first in
Japan to host a U.S. nuclear-powered aircraft carrier. The city is
now wavering over the planned deployment of the USS George
Washington to the U.S. naval base there. Late last month, shortly
after the city's municipal assembly voted down a proposed ordinance
for a poll of the city's residents on the nuclear carrier's
deployment, it was revealed that a fire had broken out on the USS
George Washington in the Pacific Ocean. The aircraft carrier's
initially scheduled deployment to Yokosuka in August is expected to
be delayed. Meanwhile, local residents are feeling uneasy about the
ship's deployment due to the U.S. Navy's insufficient account of the
fire.

"An American soldier just killed a taxi driver in March. Even worse,
a nuclear-powered aircraft carrier is coming here..." So saying, a
43-year-old homemaker lowered her voice as she was interviewed on a
residential street overlooking the Yokosuka base.

It was 35 years ago when the USS Midway, a conventional aircraft
carrier of the U.S. Navy, entered port in Yokosuka. Since then,
Yokosuka has been home to U.S. flattops. The U.S. Navy and local
residents have established friendly relations through events,
according to Yokosuka City's base relations division. In 1994, local
communities started to patrol city streets with U.S. Navy personnel.
This is the so-called "Yokosuka model," which has been noted as a
base-hosting locality's pilot approach.

With her scheduled Yokosuka deployment ahead, the George Washington

TOKYO 00001821 005 OF 008


caught fire on May 22 when she was plowing through the Pacific
waters off the coast of South America. The fire, which broke out
near the stern, damaged the cabling in about 80 areas. In addition,
a sailor was slightly burned.

"The city should request the United States disclose the accident
report, and the city government should send a delegation of
officials to the United States." With this, Masahiko Goto, a lawyer
representing a group of Yokosuka citizens calling for a local
referendum on the advisability of hosting a nuclear flattop, rattled
on when he met with city officials four days after the fire took
place.

The citizens' group collected signatures from about 48,000 Yokosuka
citizens, or a seventh of the city's voting population, for a local
referendum on whether to accept the George Washington's deployment
to Yokosuka. The group presented the signatures to the city's
municipal government in May this year. The city's municipal assembly
rejected the proposed ordinance for a local referendum. However, the
assembly adopted a petition calling for the state to make further
efforts to ensure safety and step up its preparedness for disaster
prevention.

About a week thereafter, the George Washington fire broke out. "It
was the worst timing," a city official said. U.S. Naval Forces Japan
headquarters held a press conference, during which its spokesman
stressed that there is no problem with the nuclear reactors. The
USNFJ website has made public the progress of repair work to the
George Washington, whereby the U.S. Navy appears to be showing
consideration for Japan.

However, the U.S. Navy has reiterated that it is now calculating how
long the repair work will last and whether the George Washington's
scheduled deployment to Yokosuka will be affected. As it stands, her
Yokosuka deployment reportedly could be delayed. "We can't read the
repercussions," one city official said, with a complex look on his
face.

"I want the government and the city to urge the United States to
disclose more information," said a man in his 60s who keeps a store
along Dobuita-Dori, a street that is within walking distance from
the base. "Local residents must be made to feel ease of minds," he
added.

"A nuclear-powered aircraft carrier could be targeted for attack,"
says Hiromichi Umebayashi, a special adviser to Peace Depot, a
nonprofit organization. Umebayashi, who is familiar with military
affairs, suggested: "If there is an accident like a radiation leak,
the metropolitan area will be endangered as well. Japan should call
for the United States to provide critical information in detail
about how the George Washington is damaged and what caused the
accident. Japan should verify safety itself."

(4) North Korea already eyeing "next return," keeping nuclear card
in hands

NIKKEI (Page 2) (Full)
July 2, 2008

On June 27, immediately after the U.S. government announced its
decision to delist North Korea as a state sponsor of terrorism, a
North Korean Foreign Ministry spokesman emphasized: "I believe that

TOKYO 00001821 006 OF 008


if the U.S. completely halts its hostile policy, the
denuclearization process will make smooth progress." The designation
of one nation as a terrorism sponsor is a symbol of hostile policy.
The delisting decision is an important milestone for the North
Korean regime's stability to be ensured. Now that North Korea has
been aware of the charm of being a nuclear power, the nation must be
aiming at "the next reward."

When U.S.-North Korea talks were held in Geneva in March, a North
Korean representative was fretting over a lack of guarantee from the
U.S. to delist his nation as a terrorism sponsor. North Korean Vice
Foreign Minister Kim Kye Gwan impatiently said: "We have done
everything that we can do. The U.S. should do something first this
time."

In U.S.-North Korea talks in Singapore in April, however, Kim's
facial expression was relaxed. South Korea's Tongkuk University
Professor Ko Yuwan said: "(The U.S.) might have promised to offer a
more valuable return (to the North)."

Professor Ko supposes that a more valuable return than the delisting
measure and energy aid in the second stage might be "an end to the
hostile policy or an agreement on forming a roadmap." Pyongyang is
hopeful of obtaining some clue, before President Bush leaves office
next January, to negotiate with a next U.S. administration in an
advantageous position.

In the next round of the six-party talks, the focus of discussion
will be on North Korea's denuclearization in the third step of the
process. Many observers anticipate that North Korea would demand for
light water reactors in return for its denuclearization and insist
that the issue of its nuclear weapons, whose information the nuclear
report produced recently by Pyongyang did not contain, be negotiated
in the process of discussing the disarmament issue. Some even expect
that (North Korea) might propose excluding Japan and South Korea,
both of which have no nuclear weapons, from the discussions.

Either way, it is certain that North Korea will not easily give up
its nuclear programs. Since Pyongyang has already carried out
nuclear tests, it has no decisive negotiating card. Some observers
think that North Korea might try to grope for a way out while
relying not only on the U.S. but also on other countries concerned.

In mid-June, the Chinese vice president visited Pyongyang. North
Korea signed four agreements, including one for economic and
technical cooperation, with China, which is strongly hoping to
stabilize the region in the run-up to the opening of the Beijing
Olympic Games. Some observers anticipate that Kim Jong Il might
visit China in a bid to deepen China-North Korea relations. North
Korea has succeeded in winning promises from the U.S. for 500,000
tons of food and from Russia for aid of wheat. In working-level
talks with Japan, the North managed to solicit an agreement from
Japan to gradually remove its economic sanctions in accordance with
the level of progress on the reinvestigation into the issue of
Japanese nationals abducted by North Korean agents.

North Korea appears to have begun to tighten domestic regulations.
According to a South Korean civic group, all households in all areas
across the nation excepting Pyongyang reportedly have been banned
from making toll calls starting on June 15. There is even a report
that one who had talked about starvation was arrested. North Korea
is apparently aiming to obtain a "next return" while trying to

TOKYO 00001821 007 OF 008


dispel its weak points such as food and energy shortages. Its
negotiations with Japan and the U.S. are about to enter a crucial
moment.

(5) Editorial: SDF dispatch to Sudan -- Unreasonable PKO principles
should be reviewed

SANKEI (Page 2) (Full)
July 2, 2008

Self-Defense Forces (SDF) personnel will be dispatched to the United
Nations Mission in Sudan (UNMIS) to help support UN peacekeeping
operations (PKO), which is deployed in the southern part of Sudan.

Prime Minister Yasuo Fukuda told this to UN Secretary General Ban Ki
Moon and Defense Minister Shigeru Ishiba ordered the SDF to prepare
for the dispatch. Reportedly, a couple of SDF officers will be sent
to the headquarters of UNMIS, located in Khartoum, the capital of
Sudan.

Based on a UNSC resolution, about 70 countries participated in
UNMIS. Since the UNMIS meets the requirements for the PKO
Cooperation Law, it is only natural for Japan to join the PKO in
Sudan.

UNMIS was established in March 2005. Based on the peace agreement
between the government made up mainly of Muslims in the northern
part and the anti-government force based in the southern region
where there are many Christians, UNMIS is tasked with facilitating
the voluntary return of refugees and providing demining assistance.
UNMIS has 8,712 military personnel and 631 civilian police
personnel. We hope SDF officers will fulfill their duty.

It is desirable for Japan to dispatch SDF personnel. To that end, it
is indispensable to prepare a suitable environment.

The PKO Cooperation Law stipulates five principles for the dispatch
of SDF personnel --1) the conclusion of a ceasefire agreement
between warring parties, 2) acceptance of peacekeepers by the
parties, 3) adherence to strict neutrality, 4) if these three
principles are not met, the SDF is required to withdraw, and 5) the
allowance of the minimum use of arms.

The SDF personnel are allowed to use weapons only when they protect
themselves. They are not allowed to use the authority to eliminate
conduct preventing them from fulfilling their duty, which is the UN
rule of conduct. Therefore, the SDF cannot stave off illegal acts
and thus cannot fulfill the same duties as other countries' troops.

Japan is now deploying 51 SDF officers to UN peacekeeping
operations. The number 51 is extremely small, compared with the
10,597 sent by Pakistan and China's 1,981. Japan is 83rd in rank
among 117 countries and it ranks last among the G-8 members. The
reason is because there is no PKO to which Japan can apply the five
principles.

For example, the SDF cannot participate in the UN Mission in Darfur
(UNMID) to assist peacekeeping operations there because a ceasefire
agreement is not reached between warring parties.

Prime Minister Fukuda told UN Secretary General Ban: "Japan as a
peace cooperation state will carry out comprehensive contribution."

TOKYO 00001821 008 OF 008


Since he said so, Fukuda must establish quickly a permanent law that
would allow the SDF to join any PKO. An advisory panel to Prime
Minister Fukuda has come up with a report calling for review of the
PKO Cooperation Law, which does not allow the SDF to help friendly
troops in emergencies. Fukuda should face up to this report.

(6) Heisei Period version of Maekawa Report proposes reduction of
burden on young people

MAINICHI (Page 1) (Full)
July 2, 1008

The complete text of the Heisei-Period version Maekawa Report, to be
released July 2 by the Council on Economic and Fiscal Policy's
experts study group on structural changes and the Japanese economy,
has been revealed. The report proposes a globalization of Japan to
enable it to make the most of its human resources and capital at
home and abroad. The aim is to maintain Japan's position as a
leading player in the global economy. It urges the government to
reduce the burden imposed on young people by revising the social
security system, including the public pension system. The goal is to
rejuvenate the economic system so that a society can be created in
which young people can have hope for the future.

The subtitle of the report is "Rejuvenate the Japanese Economy in
the Global Economy." It proposes a path for Japan to follow, based
on analysis of the state of the global economy, including soaring
crude oil and grain prices. It points out problems about the present
situation in the global economy, in which older people are
increasingly becoming dominant as societies age, making young people
feel helpless. The report determines that it is imperative to take a
second look at the system of benefit payments, such as pensions and
medical services for elderly people.

The report also stresses the need to create a policy-making system
that will focus on adjusting the sense of unfairness felt by each
generation so that young people's views can be reflected in
government policies. As part of such efforts, the report calls for a
system that will accommodate representatives of each generation,
allowing young people to join government advisory councils. The
report, which aims to build such a society over 10 years' time,
calls for: (1) the correction of disparities between irregular
employees and regular employees; (2) establishment of market rules
that do not discriminate between domestic and foreign companies; (3)
more efficient management of public pension funds; and (4) raising
of the share of business start-ups (at present about 4 PERCENT ). In
order to put an end to the declining birthrate and the aging
society, the report sets a target of raising the total fertility
rate to 1.7 or 1.8 persons.

The panel wants its report to be used by Prime Minister Yasuo Fukuda
in a message on Japan's future vision he plans to transmit to the
international community at the G-8 Summit in Hokkaido.

SCHIEFFER

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