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Cablegate: Japanese Morning Press Highlights 07/09/07

DE RUEHKO #3104/01 1900104
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1) Top headlines
2) Editorials

Prime Minister's weekend schedule: Election campaigning and TV

3) Latest Asahi pre-election series poll shows Minshuto ahead of
LDP, 26 to 22 % , as voters' preference, and Abe Cabinet non-support
rate climbing to 51 %

New scandal hits Abe cabinet:
4) Farm minister Akagi's political fund organization listed 100
million yen as office expenses over 10 years to office in Akagi's
parents' home that did not exist
5) Prime Minister Abe denies that Akagi's office expenses are an
6) Opposition parties plan to pursue the latest scandal involving
possible falsification of political fund reports by farm minister
7) Akagi scandal puts Abe on the defensive in weekend TV debates
8) Akagi's father retracts statement that his home was not used as
son's political office
9) Akagi: My father was mistaken about use of his home as political

10) Abe in TV debates dodges issue of future hike in consumption
tax, says expenditures would be cut first

11) LDP policy chief Shoichi Nakagawa in radio program denounces
Kono Statement on comfort women as "masochistic" view of history,
defies international opinion

Defense and security affairs:
12) Vice Minister Moriya meets Pentagon officials in Washington,
seeks US cooperation on FX selection
13) Former Under Secretary for Defense Lawless in Asahi interview
urges Japan to first create a long-term strategy before considering
introducing F-22s
14) North Korea may have test-fired ballistic missiles three times
in violation of UN resolution
15) Japan willing to pay for IAEA's costs of inspecting in North



Asahi, Mainichi, Yomiuri & Tokyo Shimbun:
War-orphan class-action suit to end with governing coalition's
compensation measures accepted by war-orphans

FTC plans to establish a collective action system for protection of

DPJ President Ozawa declares he will "retire" from politics should
the opposition fail to grab majority in Upper House election

Party-head debate kicks off on three TV programs; Chairman Shii

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explains JCP's stance on office expenses, consumption tax, pensions


(1) Farm Minister Akagi: Inappropriate accounting of office expenses
(2) 10 years since currency crisis: Reform still essential

(1)Problem parents: System needed to keep teachers from being
(2) Domestic Violence Prevention Law: Stronger cooperation needed to
protect victims

(1) In-depth discussion essential to allow the exercise of the right
to collective defense
(2) Iwami Silver Mine designated as World Heritage site

(1) Good use of M&As: More attention paid to shareholders over
hostile takeover and hedge funds

(1) Farm minister's office expenses: Prime minister urges him to
fulfill his "accountability"
(2) Sochi Winter Olympics: Concern about the rising importance of

Tokyo Shimbun:
(1) Farm Minister Akagi's office expenses: Receipts needed
(2) Selection of Olympic venue dictated by financial and political

(1) 2007 World Conference against A&H Bombs: Create a new wave for
nuclear abolition


Poll: 26 %to vote for DPJ, 22 %for LDP

ASAHI (Page 1) (Full)
July 9, 2007

Ahead of the upcoming election for the House of Councillors, the
leading opposition Democratic Party of Japan (Minshuto) stood at 26
%in popularity rating for proportional representation and the ruling
Liberal Democratic Party was at 22 % , the Asahi Shimbun found from
its recent 9th telephone-based serial public opinion survey. The DPJ
topped the LDP this time, following the last survey. In rivalry for
electoral districts as well, the DPJ had a lead over the LDP. The
rate of public support for Prime Minister Abe and his cabinet was 31
% , up from the 28 %rating in the last survey. However, the
nonsupport rate was 51 %(48 %in the last survey), paralleling its
all-time low.

The proportion of those who are "very interested" in the House of
Councillors election increased to 38 %(34 %in the last survey). The
figure was between 30 %and 35 %over the past period of one month.
However, the public's interest seems to growing with the election to

TOKYO 00003104 003 OF 011

be announced July 12. The last election for the House of Councillors
was held three years. At that time, the figure was around 30 %until
just before voting.

In the past three surveys from the seventh survey to the ninth one,
the DPJ marked 23 % , 25 % , and 26 %for proportional
representation. The LDP increased to 22 %this time from 19 %in the
last survey. However, the LDP is still behind the DPJ.

In the public choice of political parties for voting in electoral
districts, the DPJ rose to 28 %(25 %in the last survey). The LDP was
at 25 %(26 %in the last survey), staying at almost the same level
for the sixth week in a row. In the survey, respondents were also
asked if they would like the ruling coalition to retain its current
majority of the seats in the House of Councillors as a result of its
election this time or otherwise if they would like the opposition
camp to win a majority. To this question, 48 %chose the opposition
camp, with 29 %preferring the LDP-led ruling coalition.

The general public is turning a severe eye to the Abe cabinet due in
part to the government's pension record-keeping flaws and Defense
Minister Kyuma's resignation. Abe last week announced a new set of
measures, including a plan to check pension records earlier than
scheduled. In the survey, respondents were asked if they appreciated
the Abe cabinet's response to the pension issue. To this question,
"yes" accounted for 30 % , up from 24 %in the last survey. However,
"no" was at 56 %(59 % ), still topping 50 % .

Defense Minister Kyuma has now resigned over his remarks that
justified the United States' atomic-bombings of Japan. In the
survey, respondents were asked if they thought Abe's response over
this issue was appropriate. To this question, negative answers
accounted for 58 % , with affirmative answers at 23 % . Respondents
were also asked if they thought Abe's appointment of Yuriko Koike as
the successor to Kyuma was good. In response, "yes" accounted for 38
% , with "no" at 32 % .

In the breakdown of public support for political parties, the LDP
stood at 26 % , with the DPJ at 20 % . New Komeito, the LDP's
coalition partner, was at 4 % . The Japanese Communist Party was at
3 %and the Social Democratic Party (Shaminto) at 1 % .

4) Farm Minister Akagi's political organization registers 100
million yen in office expenses over decade for use of parents' and
wife's homes

TOKYO SHIMBUN (Top Play) (Excerpts)
July 8, 2007

A political funds scandal has surfaced involving Agriculture,
Forestry and Fisheries Minister Norihiko Akagi. The home of his
parents in Ibaraki Prefecture has been registered as the office of
his political organization, but the organization declared a total of
approximately 90.45 million yen as operating costs in the ten-year
period up to 2005, according to its reports on political funds.

In replying to questions from reporters yesterday, Akagi denied the
allegation, saying, "There has been no fictitious booking of

Over the 10-year period, the organization registered about 54.53
million yen in personnel costs, accounting for nearly 60 % ; about

TOKYO 00003104 004 OF 011

16.31 million yen in office expenses; about 12.66 million yen in
miscellaneous costs; and about 7.94 million yen as utility costs.

The amount of operating costs reported by the organization greatly
varies according to year. The group had declared more than 10
million yen for the four years in a row since 1998, but the sum
significantly dropped to the 2-million-yen level in 2004 and 2005.

The amount of office expenses should not wildly change, but the
group reported about 3.57 million yen in 2003 but only about 400,000
yen in 2005.

Before reporters, Akagi said: "Since the organization's office is in
my parents' home, rent has not been paid. The reported office
expenses include telephone, stamps, office equipment rental, and
other charges."

Akagi's another political organization whose office is situated in
the home of his wife's parents in Setagaya War, Tokyo, also reported
a total about 15 million yen in the ten-year period up to 2005,
according to its political funds reports submitted to the internal
affairs and communications minister.

The representative of the group said: "I succeeded the
representative post from my father about 10 years ago. Farm Minister
Akagi's wife is my niece. I have just given my name, so I don't know
about any expenditures."

5) Prime minister turns down opposition camp's demand for dismissing

TOKYO SHIMBUN (Page 1) (Excerpts)
July 8, 2007

Prime Minister Shinzo Abe turned down a demand from opposition
parties that Agriculture, Forestry and Fisheries Minister Akagi be
dismissed over his political group's alleged accounting
irregularities. In the run-up to the House of Councillors election
on July 29, however, ruling party members might call for his
resignation if public criticism grows louder.

Last December, Genichiro Sata, then state minister in charge of
administrative reform, was driven to resign over inappropriate
accounting of his political expenses. The prime minister
categorically said, "This case is different from (that of Sata),"
brushing aside the allegation. Abe also indicated that there was no
problem with the response taken after the scandal emerged, saying:
"I hear Mr. Akagi has clearly explained the circumstances." The
prime minister was replying to questions by reporters in front of
his official residence.

In street-corner speeches or dialogues, senior members of opposition
parties harshly denounced the Akagi political funds issue yesterday.
Taking the allegations against Akagi as good material for attacking
the ruling camp prior to the House of Councillors election,
opposition members intend not only to call for Abe to dismiss the
farm minister but also to thoroughly pursue Prime Minister Abe's
responsibility for appointing him.

Democratic Party of Japan (Minshuto) President Ichiro Ozawa
emphasized to reporters in Nagoya last night: "So many
'politics-and-money' scandals have emerged, including those

TOKYO 00003104 005 OF 011

involving Farm Minister Akagi and former Farm Minister Toshiaki
Matsuoka, who committed suicide. Under such a situation, it is
impossible for the administration to win public trust. I expect the
people to make a wise judgment in the (Upper House) election,
including Prime Minister Abe's responsibility for appointing them."

6) Agriculture minister's office expenses: Opposition determined to
pursue prime minister's responsibility; Ruling parties concerned
about possible impact on Upper House election

YOMIURI (Page 4) (Full)
July 8, 2007

The opposition camp on July 7 harshly criticized Agriculture
Minister Akagi in response to his office expenses with the public
announcement of the Upper House election on July 12. They called for
his resignation. They are stepping up their offensive and are geared
up to pursue the prime minister's responsibility for appointing

Democratic Party of Japan (DPJ or Minshuto) head Ozawa on July 7
told reporters in Nagoya: "Mr. Akagi finds it impossible to explain
his money matters to the public. The Abe cabinet has too many
situations like this. It will be unable to obtain understanding from
the people." Regarding the prime minister's responsibility, he said:
"It is only natural that the person who appointed Akagi is
responsible. The public will make their judgment in the Upper House

Japanese Communist Party General Secretary Ichita the following day
told reporters at the party head office: "The minister in question
should resign. If he does not quit, Prime Minister Abe should
dismiss Mr. Akagi." Social Democratic Party head Fukushima in a
statement sought the dismissal of Akagi and his explanation on the
issue at the Lower House Budget Committee.

The opposition camp intends to question the prime minister on this
issue at a party head debate to be held at the Japan National Press

The amended Political Funds Control Law, which was submitted by the
ruling parties and enacted during the previous Diet session,
obligates lawmakers to attach receipts when they report operating
expenses of their fund control organizations, if expenditures,
excluding personnel expenses, exceed 50,000 yen. The regulation does
not cover the political organization in question this time. The DPJ
had insisted on covering political organizations, as well. It
intends to point out the ruling parties' lax approach.

The ruling camp is taking the issue seriously.

Upper House Policy Deliberation Council Chairman Yoichi Masuzoe, who
is expected to run in the election in a proportional-representation
bloc, on July 7 said, "The pension flap, the resignation of Defense
Minister Akio Kyuma, and the "money and politics" issue ... the
ruling camp is in dire straits. We are bound to lose votes."

One senior ruling party official yesterday said: "There is a
discrepancy between the explanation given by the agriculture
minister and the accounts given by local sources. We need to hear
more. If he cannot explain this, then we must take it as a serious
problem." He thus indicated his view that the explanation given by

TOKYO 00003104 006 OF 011

Akagi that day was insufficient.

Akagi succeeded former Agriculture Minister Toshikatsu Matsuoka, who
killed himself following revelations of dubious accounting. Given
that, some fear that the issues surrounding Akagi will call into
question the prime minister's responsibility.

7) Prime minister again stands behind agriculture minister over his
alleged mishandling of offices expenses

ASAHI (Page 1) (Excerpts)
July 9, 2007

With the looming suspicions of financial impropriety involving
Agriculture Minister Akagi, the "politics-and-money" problem has now
again captured public attention to become a campaign issue for the
upcoming Upper House election. The Abe administration and the
governing coalition once tried to sidestep the problem by revising
the Political Funds Control Law after suffering a blow from former
Agriculture Minister Toshikatsu Matsuoka's suicide, but now again
the improper handling of offices expenses involving the successor
minister to Matsuoka has been exposed. Prime Minister Abe's
responsibility for installing Akagi in the ministerial post and the
appropriateness of the revised Political Funds Control Law are both
likely to be called into question. The ruling bloc is increasingly
frustrated by the increasing headwind even before the announcement
of the Upper House election on July 12.

The heads of the ruling coalition came under heavy fire from chiefs
of opposition parties on TV political talk shows yesterday.

The major opposition Democratic Party of Japan's (Minshuto)
President Ozawa argued: "It's a matter of transparency. The
important thing is to come out with all measures to resolve the
problem and give an explanation."

The Japanese Communist Party's (JCP) Chairman Shii raised this
question: "Does the prime minister intend to ask the agriculture
minister to present the relevant receipts?"

The minority opposition Social Democratic Party's (SDP) leader
Fukushima contended: "If no proper explanation is given, we will
call for his dismissal. The prime minister will bear a heavy
responsibility for having appointed him."

Ahead of the Upper House election, opposition parties intend to
emphasize that the Abe administration has been lax about the
"politics-and-money" scandals and lacks crisis management

All the prime minister can do at present is just to defend Akagi,
given that Genichiro Sata resigned as state minister in charge of
administrative reform over the improper handling of offices
expenses, that former Agriculture Minister Matsuoka committed
suicide, and that on July 3, former Defense Minister Fumio Kyuma
resigned from his post due to his controversial remarks that the
dropping of atomic bombs "couldn't be helped." A mainstay lawmaker
of the ruling Liberal Democratic Party (LDP) noted: "After Mr.
Matsuoka committed suicide, if his successor resigns from the post
over a similar problem, what can our party do?"

Abe initially wanted to use his successive appearance on TV programs

TOKYO 00003104 007 OF 011

as an occasion to take the offensive. But the revelation of the
suspicions of financial impropriety involving Akagi forced Abe to go
on the defensive.

On the night of July 7, one senior LDP member pointed to the prime
minister's responsibility for appointing Agaki to the post. The
member complained: "If I were the prime minister, I would not have
chosen Akagi as farm minister. (Scandals) seem to continue to crop
up one after the other. It's shameful."

8) Farm minister's father retracts statement that house was not used
as office

MAINICHI (Page 2) (Full)
July 9, 2007

A political funds scandal has surfaced involving Agriculture,
Forestry and Fisheries Minister Norihiko Akagi. It has been alleged
that although a political group supporting Akagi Ibaraki has set its
office in the home of his parents in Ibaraki Prefecture without
carrying out political activities, the group reported huge amounts
of expenditures. On this matter, Akagi's father distributed to
reporters copies of a note that said: "My house is still used as an
office." The father had said previously: "I was not aware that my
house had been registered (as the office of the organization).
(Political activities) have not been carried out here."

The note said: "It has been reported that my house has not been used
as an office, but the truth has not been properly reported," adding:
"I meant that although a secretary had been stationed at the house
before, current activities here are not as active as before."

9) Farm Minister Akagi: Father's statement was based on "simple

MAINICHI (Page 2) (Full)
July 9, 2007

Agriculture, Forestry and Fisheries Minister Akagi told reporters
last night: "(My father's statement on the 7th) was based on a
simple misunderstanding. The house has been used for many years for
organization members to hold various meetings." Akagi also turned
down a demand by opposition parties that he disclose the details of
the reported expenses, saying: "Since there is no legal requirement
for the details to be announced, we will proceed in accordance with
the relevant law."

10) Consumption tax hike: "Spending cuts first," says prime
minister, indicating his intention to discuss issue in fall and

ASAHI (Page 2) (Full)
July 9, 2007

Referring to the possibility of hiking the consumption tax after the
Upper House election, Prime Minister Abe yesterday indicated his
intention to discuss the matter during a tax code revision in the
fall and thereafter. He noted: "I will cut expenditures in a
far-reaching way. Economic growth will boost tax revenues. I would
then like to discuss the issue, including measures to make up for a
tax revenue shortfall." He made this comments on NHK and commercial
TV talk shows.

TOKYO 00003104 008 OF 011

The prime minister on a commercial TV program on the 5th made a
remark that could be taken as positive toward increasing the tax,
saying, "I have never said that I would not raise the consumption
tax." However, as the consumption tax comes into the focus of the
election campaign, he has toned down his stance using cautious
rhetoric.On the 8th, too, he simply noted, "There is an ample
possibility of steering clear of hiking the consumption tax" or "A
hike in the consumption tax will slow economic growth, leading to a
slower increase in tax revenues than expected"

Democratic Party of Japan (DPJ or Minshuto) head Ozawa said, "Tax
hikes worth almost 9 trillion yen have been implemented during the
Koizumi and Abe administrations. If the consumption tax were raised
at this juncture, it would be those in the lower income bracket that
will take the brunt." He indicated his intention to freeze the tax
rate and pointed out, "If the prime minister thinks it is necessary
to hike the tax, he can say so. However, since the issue involves
the public burden, he must take it upon himself to clarify his

11) Wartime comfort-women issue: LDP policy chief Shoichi Nakagawa
rails: "Kono Statement is masochistic"

AKAHATA (Page 1) (Full)
July 7, 2007

Liberal Democratic Party (LDP) Policy Research Council Chairman
Shoichi Nakagawa, appearing on a Radio Nippon program July 6,
criticized the 1993 statement by then Chief Cabinet Secretary Yohei
Kono (currently speaker of the Lower House) acknowledging and
apologizing for the former Imperial Japanese Army's involvement in
coercive recruitment of "comfort women." Nakagawa said, "(Kono) had
a masochistic way of thinking." He then added: "Even if they are
lies, foreign countries proudly spout them out. I cannot accept the
(Japanese government) muzzling those who think the truth."

In the United States in late June, the House of Representatives
Foreign Affairs Committee adopted by an overwhelming majority a
resolution demanding an apology from Japan for the comfort-women
problem. There is a strong likelihood that the full House will pass
the resolution in mid-July. Nakagawa in his remarks displayed strong
defiance of such growing international criticism.

12) Japan asks US for cooperation over FX selection

NIKKEI (Page 2) (Full)
July 8, 2007

WASHINGTON-Vice Defense Minister Takemasa Moriya met with former US
Deputy Under Secretary of Defense Lawless and Deputy Secretary of
State Negroponte on July 6. In his meetings with them, Moriya asked
for cooperation, explaining that Japan will select its follow-on
mainstay fighter plane in the summer of next year. With this, Moriya
asked the United States to provide data about the F-22 stealth

The United States prohibits itself from exporting the F-22, which is
hard to detect with radar. In the United States, there are questions
regarding Japan's information security against the backdrop of Aegis
vessel data leaks.

TOKYO 00003104 009 OF 011

13) Japan should create long-term strategy first: Lawless

ASAHI (Page 1) (Abridged)
Eve., July 7, 2007

Yoichi Kato

WASHINGTON-Former US Deputy Under Secretary of Defense Lawless, who
was in charge of US security policy toward Asia, met Asahi Shimbun
and other news media reporters on July 6 for the first time since
his retirement last weekend. Japan is going to pick the Air
Self-Defense Force's follow-on mainstay fighter plane (FX), with an
eye to the F-22, a state-of-the-art stealth fighter developed by the
United States. The question, however, is whether the United States
will agree to export the F-22 to Japan. "I'm saying we will have to
explore a common understanding over whether Japan will really need
this fighter plane in the 20 or 30 years ahead," Lawless said. With
this, he stressed that Japan should create a long-term military
strategy first.

Japan has asked the United States to provide F-22 data in order to
select a candidate model. However, the US government has not
responded on the grounds of a US congressional decision that
prohibits the United States from exporting the F-22.

"It's logical for Japan to ask for detailed data," Lawless said,
adding: "I don't want Japan to say it wants the F-22 as a symbol (of
its defense capabilities) because it's attractive." So saying,
Lawless urged Japan to specify its necessity from the perspective of
military strategy.

Given that the US Congress is not expected to reverse course for the
time being, Lawless indicated that the US government will have no
choice but to consider Japan's strategic need based on unrestricted
basic data.

Meanwhile, the Maritime Self-Defense Force has been engaged in
refueling activities in the Indian Ocean under the Antiterrorism
Special Measures Law. This law, however, will expire in November. In
response, the Japanese government is looking into the possibility of
sending transport helicopters from the Ground Self-Defense as an
additional measure. However, Lawless said the US government has not
made any official request to the Japanese government.

However, Lawless revealed that the United States has told Japan that
the US government would like to hold consultations this fall about
what the two countries can do together. Specifically, he said the
United States would ask Japan to send personnel or "other (military)
capabilities to a provisional reconstruction team (PRT)." With this,
he implied that the United States could ask Japan to send heavy-lift

14) North Korea launched ballistic missiles on three occasions since
May in violation of UN resolution

YOMIURI (Page 1) (Full)
July 7, 2007

The government has confirmed that short-range missiles launched by
North Korea into the Sea of Japan and the Yellow Sea on May 25 and
June 7 were ballistic missiles.

TOKYO 00003104 010 OF 011

The North launched short-ranged missiles on June 27, as well. The US
National Security Council concluded that those missiles were
ballistic, and Prime Minister Shinzo Abe accused Pyongyang of
violating a UN Security Council resolution. Pyongyang's launch of
ballistic missiles in May was also a violation of the UN resolution
adopted in October demanding the North halt its ballistic missile
development program.

According to government sources, the missiles launched on the three
dates in question are believed to be models of the KN-02, an
improved version of the short-range SS-21 ballistic missile of the
former Soviet Union. The KN-02 is believed to be powered by solid
fuel and have a range of up to 120 kilometers. A Defense Ministry
official said the missile poses no direct threat to Japan's
security. Initially, the missile fired in late May and early June
were thought to be improved models of the Silkworm anti-ship cruise

There have been signs of a thaw between North Korea and the United
States, as seen in Pyongyang's announcement to readmit International
Atomic Energy Agency (IAEA) inspectors, as was agreed upon in the
six-party talks in February. The ballistic missiles launched
conducted under such circumstances have sparked various speculations
in the Japanese government about Pyongyang's motive. Some think that
the North might have been unaware that it had violated the Security
Council resolution because the launches were conducted as part of
drills that are usually held during the same period each year.
Others speculate that Pyongyang wanted to see whether the United
States was really ready to mend fences with the North.

The US government, which did not react strongly to the missile
launches on May 25 and June 7, accused the North's launches on June
27 as a violation of the UN resolution, demonstrating its double
standard toward the North.

A Japanese government official took this view about Washington's
inconsistent response to Pyongyang's missile launches: "The United
States had ignored the launches on the first two days because they
were short-range missiles. But Washington's increasingly attitude of
appeasing the North, as seen in a visit to Pyongyang by Assistant
Secretary of States Christopher Hill, has forced the hardliners in

the Bush administration to retreat."

15) Government to financially contribute to IAEA activities for
denuclearization of North Korea

NIKKEI (Page 2) (Full)
July 7, 2007

The government decided yesterday to make financial contributions to
the International Atomic Energy Agency's (IAEA) planned activities
to monitor and verify the shutdown and sealing of nuclear facilities
in North Korea. The purpose is to indirectly assist the IAEA in its
activities to denuclearize North Korea. The government plans to come
up with a specific amount in order to announce it at the special
IAEA directors meeting on July 9.

According to a report by the IAEA working-level team that visited
Pyongyang earlier, activities in North Korea would cost the nuclear
watchdog 3.9 million euros, or 640 million yen, for two years from
2007. The Unites States is also considering making constitutions.

TOKYO 00003104 011 OF 011

Japan, which has no intention of providing energy aid to the North
unless the abduction issue is settled, draws a distinction with
other six-party members -- the United States, China, South Korea,
and Russia. Tokyo has decided to make financial contributions to the
IAEA, concluding that such would not constitute direct assistance to
the North. Tokyo also intends to avoid being further isolated in the
six-party talks by playing up its eagerness to contribute to the
North Korea nuclear issue.


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