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Cablegate: Daily Summary of Japanese Press 09/28/07

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UNCLAS SECTION 01 OF 22 TOKYO 004557

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 09/28/07


Index:

(1) Japan begins discussing sanctions against Burma (Myanmar); Prime
minister indicates need to ascertain the situation

(2) Premier Wen tells Prime Minister Fukuda, "China will make
efforts" to deal with situation in Burma (Myanmar)

(3) Burma's (Myanmar's) authorities take into custory Tokyo
Shimbun's local correspondent

(4) Editorial -- Burma (Myanmar) under oppression: China should join
international pressure on Burma's military junta

(5) Focus -- Summit between two Koreas: Interview with Hajime Izumi;
"North" likely to make full use of results of dialogue with US

(6) Mitsubishi Heavy Industries wins order for nuclear plant
equipment in China

(7) Poll on Fukuda cabinet, political parties (Mainichi)

(8) Spot poll on Fukuda cabinet, political parties, MSDF refueling
mission (Yomiuri)

(9) Poll on Fukuda cabinet, political parties (Asahi)

(10) Understanding Prime Minister Fukuda from his sayings

(11) Fukuda office altered receipts for 2006 funds report

(12) Fukuda-led branch office, political groups found to have
rewritten addresses on receipts worth 5.8 million yen

(13) Prime Minister Fukuda: "I feel really ashamed" of political
funds problem

(14) Ibuki-headed LDP branch office received illicit donations from
money-losing company for over three years

(15) Diet to reopen at long last for a showdown; LDP to present new
bill before antiterror law loses its effect

(16) Fate of correction of social disparities: Striking balance with
fiscal reconstruction is challenge

(17) Keizai Kyoshitsu (Economic Classroom): Post-Abe politics --
ideals and policy (part 1); Do not allow reactionary politics to
become rampant; Continuation of reform drive at crucial state;
Revitalization of local communities based on agriculture,
decentralization

ARTICLES:

(1) Japan begins discussing sanctions against Burma (Myanmar); Prime
minister indicates need to ascertain the situation

YOMIURI ONLINE NEWS (Full)
September 28, 2007, 13:54 p.m.

The government this morning began discussing sanction measures
against the military junta of Burma in response to its armed

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crackdown on antigovernment demonstrators, which caused scores of
casualties, including the death of a Japanese journalist, Kenji
Nagai.

As a specific sanction measure, banning new investment in Burma is
being proposed.

At noon today, Prime Minister Fukuda told reporters: "We need to
ascertain the situation before deciding to whether to impose
sanctions immediately. Most aid projects Japan has previously
implemented in Myanmar have humanitarian aspects. We must take that
point into consideration"

Meanwhile, Foreign Minister Komura, now visiting Washington, told
reporters traveling with him, "Depending on Burma's military junta's
response, we will take a strong measure," implying that if the
regime continues an armed crackdown on citizens in the days ahead,
Japan would have no choice but to impose its own sanctions.

Tokyo intends to convey this policy to Burma via Deputy Foreign
Minister Mitoji Yabunaka of the Foreign Ministry, who is to be sent
to that country. As of this morning, however, the military junta has
not accepted Yabunaka's visit yet.

(2) Premier Wen tells Prime Minister Fukuda, "China will make
efforts" to deal with situation in Burma (Myanmar)

YOMIURI ONLINE NEWS (Full)
September 28, 2007, 13:22 p.m.

Prime Minister Fukuda this morning had a 25-minute conversation with
Chinese Premier Wen Jiabao by phone.

Referring to the situation in Burma, where the military junta has
continued an armed crackdown on citizens, Wen said: "We are closely
watching the situation. We think the international community should
offer constructive assistance to that country. China will make
efforts in this regard."

Prime Minister Fukuda conveyed to Wen his intention to visit China
as quickly as possible and told Wen: "We wish to invite President Hu
Jintao to visit Japan around next spring."

The two prime ministers agreed to work to build a "strategic,
reciprocal relationship" between the two countries from now on, as
well.

(3) Burma's (Myanmar's) authorities take into custory Tokyo
Shimbun's local correspondent

ASAHI NET (Full)
September 28, 2007 01:27 p.m.

It was learned today that a local correspondent of the Tokyo Shimbun
(Chunichi Shimbun) has been taken by police authorities of Burma
(Myanmar) where a Japanese journalist covering antigovernment
demonstrations was killed. Whether the correspondent was put under
restraint or was only being questioned is unknown.

According to the Tokyo Shimbun's Foreign News Department, the
correspondent is a Burmese man. He reportedly was taken from his
home in Rangoon (Yangon) before dawn on Sept. 28. His main job was

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to assist the coverage of the daily's Bangkok bureau chief, a
Japanese correspondent.

The Burmese correspondent was covering the mounting unrest in
Rangoon along with the Japanese journalist, who arrived in the city
on Sept. 24. The Burmese military government deported the Bangkok
bureau chief on the 26th because he had covered antigovernment
demonstrations.

(4) Editorial -- Burma (Myanmar) under oppression: China should join
international pressure on Burma's military junta

MAINICHI (Page 5) (Full)
September 28, 2007

Burma's military junta used force to crack down on demonstrations of
Buddhist monks protesting against gasoline price hikes, and the
death toll rose when soldiers began indiscriminately firing on
demonstrators.

How outrageous! Solders turned their guns on unarmed monks. The
Burmese people, who have a deep faith, take this act as morals
deteriorating. Social unrest will widen even further.

Demonstrations began in August and have now spread to major cities
across the country. With gasoline and heating oil prices doubled,
the masses have suffered a serious blow all the more because they
have to rely on small generators and kerosene cooking stoves for
their daily lives. The demonstrators are acting on behalf of the
masses. What the junta should do is to consider a proper economic
policy instead of using force to clamp down on demonstrators.

Burma has one of the major natural gas resources in the world, but
its people are suffering soaring energy prices. This is perhaps
because the wealth earned from exports of natural resources is
pocketed by the military leaders. Burma should shift to a civilian
government as quickly as possible.

We need no more bloodshed. The United Nations Security Council
(UNSC) expressed concern over the situation in Burma. But the
concern was voiced in the form of "an unofficial statement," which
is seen as softer than a resolution or a president's statement.

The reason was that China, which has been linked by
"resource-oriented diplomacy" to the military junta, raised an
objection against sanctions called for by the United States and
European nations. This development could send the military junta a
wrong message that "The UN is weak." The question is whether China
has fulfilled its responsibility as a permanent UNSC member. China
may be in part responsible for allowing the junta to run amok.

The UN will send, as a special envoy, its secretary general's
Special Advisor Gambari to Burma. A much stronger action will be
necessary, depending on a response by the military junta in the days
ahead.

In January, a resolution condemning the military junta was put
forward in the UN, but China rejected it by resorting to a veto. One
reason China did so was reportedly because of the projects for
exploring natural gas fields off Burma and for constructing a
pipeline that would link Burma and China's Yunnan Province. China as
well as the military junta would suffer a blow if the construction

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of the pipeline were suspended because of economic sanctions against
Burma.

Burma lies in between China and India and it is abundant in natural
resources, beginning with natural gas and lumber. Those natural
resources are attractive to India. India is approaching Burma.
Russia is going along with China. It is therefore not an easy task
for the international community to be aligned with criticism of the
military junta.

Japan's position, as well, is not simple, either. Japan had a good
record in official development assistance (ODA) to Burma, but it has
refrained from offering aid to Burma since the occurrence of its
violation of human rights. As a result, China took the place of
Japan and has become influential on Burma.

International pressure is necessary to stem the military junta from
running amok and have it open a dialogue with democratic forces. To
that end, it is indispensable to get China, a patron of Burma in a
good or bad sense, to join international pressure. We urge China to
be aware of its responsibility as a permanent UNSC member.

(5) Focus -- Summit between two Koreas: Interview with Hajime Izumi;
"North" likely to make full use of results of dialogue with US

YOMIURI (Page 7) (Full)
September 27, 2007

Hajime Izumi, professor at University of Shizuoka

Interviewer: Takashi Nakagawa

-- What do you think is North Korea aiming at in the upcoming summit
between two Koreas?

"North Korean General Secretary Kim Jong Il decided to meet with the
South Korean top leader at a time when nuclear talks between the
United States and the North were put in motion. I presume Kim's
strategy is to 'take whatever it can from South Korea" on the
strength of a deal cut with the United States. In addition, he will
try to influence the presidential election in South Korea slated for
December. The North wants to make full use of the North-South summit
in order to get the ruling party-backed presidential candidate, who
is conciliatory toward the North, to be elected. If the number of
South Koreans supportive of the so-called sunshine policy or
engagement policy toward the North increases as a result of the
summit, no drastic policy shift could occur even though a
conservative government is established."

-- What is the aim of South Korea?

"What is clear at present is that President Roh Moo Hyun, who will
complete his term of office in five months, is trying to build a
legacy for his administration. In relations between the two Koreas,
talks on 'reconciliation,' including dialogue, exchange, and
cooperation, have been generally finalized at the 2001 summit
between then President Kim Dae Jung and Kim Jong Il. The next
subjects for talks are 'peace' and 'economy.' Although it may be
difficult to finalize talks on those subjects, if the president can
produce something symbolic in the upcoming summit, he could use it
as a legacy."


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-- Can he produce a result?

"Roh should come up with a plan to offer considerably massive
economic cooperation (to the North), but Kim wouldn't think the
president, whose term of office is to expire shortly, can actually
put the plan into action. What the North can expect from the
upcoming bilateral summit would be (economic) assistance in exchange
for progress on the issue of prisoners of war taken in the Korean
War and the issue of South Koreans abducted to the North. The South
Korean delegates to the upcoming bilateral summit will include 17
business leaders. Also, expectations are building that transactions
with South Korean firms will occur for the purpose of promoting
direct investment (in the North) by the (South Korean) private
sector."

-- How about the nuclear issue?

"In 2005, South Korea made mention of 2 million kilowatts of
electricity supply. If in the upcoming summit, Roh promises to offer
aid and provide a light-water reactor that can generate that amount
of electricity to the North, this will be linked to the six-party
talks. Pyongyang has called for a light-water reactor in the
six-party talks. With South Korea responding to this call from the
North, other six-party members may come to bear the expenses for the
construction of electric transmission facility. Also, an idea may
come out of jointly digging a uranium mine in the North."

-- What impact there will be on Japan-North Korea relations?

"US-North Korea talks are making progress now. If the summit between
two Koreas moved their ties forward further, the North would become
eager about tackling negotiations with Japan. If the North deemed it
is possible to elicit something beneficial from Japan if it had
talks with it, it would naturally become positive about such
talks."

(6) Mitsubishi Heavy Industries wins order for nuclear plant
equipment in China

NIKKEI (Top Play) (Excerpts)
September 28, 2007

Mitsubishi Heavy Industries Ltd. will tie up with the Harbin group,
a major Chinese heavy machinery manufacture in Heilungkiang
Province, to make a full-scale entry into the Chinese market for
equipment used in nuclear power plants. The two companies will
jointly receive orders for key power components from the Chinese
government for two nuclear power plants the government plans to
construct. They are also considering the possibility of producing
large turbines and other equipment together. The orders the partners
will receive are worth more than 100 billion yen. The Chinese market
for equipment used in nuclear power plants is expected to be worth
10 trillion yen over the next 20 years. Given this, leading nuclear
facility makers across the world, such as Westinghouse Electric Co.
of the US under the wings of Toshiba Corp. and Areva of France, are
stepping up efforts to win orders from China. Mitsubishi Heavy will
fully cooperate with the Chinese government for its effort to
develop a local nuclear equipment industry and gain a foothold in
the giant market, which is on a par with the United States.

The Japanese and Chinese partners will sign a contract with the
Chinese government in Beijing on Sept. 28 for building large-scale

TOKYO 00004557 006 OF 022


equipment to be used in the Sanmen nuclear power plant to be
constructed in Zhejiang Province. They have now secured a contract
worth 60-70 billion yen to supply large equipment, such as steam
turbines. They are also expected to win a contract for equipment for
the Haiyang nuclear power plant to be constructed in Shandong
Province. The value of the order is estimated to be almost the same
level as that for the Sanmen plant.

Westinghouse Electric signed a contract with China this July to
construct the reactors for the two plants. For key power components
to these plants, Mitsubishi Heavy won a victory by joining hands
with Harbin group after competing with Siemens AG of Germany and
Alstom SA of France.

In China, more than 70 PERCENT of the power generation facilities
are coal thermal power plants. Against the backdrop of such serious
problems as air pollution, deterioration, and electric power
shortage, however, the nation has no choice but to depend on nuclear
power plants from now. The Chinese government pans to expand its
nuclear power generation capacity by more than 30.

(7) Poll on Fukuda cabinet, political parties (Mainichi)

MAINICHI (Page 3) (Full)
September 27, 2007

Questions & Answers
(T = total; P = previous; M = male; F = female)

Q: Do you support the Fukuda cabinet?

T P M F
Yes 57 (29) 52 59
No 25 (58) 31 22
Not interested 16 (13) 14 17

Q: (Only for those who answered "yes" to the above question) Why?

T P M F
Because the prime minister is from the Liberal Democratic Party 13
17 11
Because something can be expected of the prime minister's leadership
12 8 13
Because there's something stable about the prime minister 58 58 57
Because something can be expected of the prime minister's policy
measures 12 13 11

Q: (Only for those who answered "no" to the above question) Why?

T P M F
Because the prime minister is from the Liberal Democratic Party 20
29 14
Because nothing can be expected of the prime minister's leadership
21 11 28
Because there's no fresh image about the prime minister 20 24 17
Because nothing can be expected of prime minister's policies 35 29
39

Q: Which political party do you support?

T P M F
Liberal Democratic Party (LDP) 32 (27) 35 30

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Democratic Party of Japan (DPJ or Minshuto) 26 (29) 30 25
New Komeito (NK) 4 (4) 3 4
Japanese Communist Party (JCP) 2 (4) 2 2
Social Democratic Party (SDP or Shaminto) 3 (1) 2 3
People's New Party (PNP or Kokumin Shinto) 0 (1) 1 --
New Party Nippon (NPN or Shinto Nippon) 1 (1) 1 1
Other political parties 1 (1) 1 1
None 30 (32) 25 32

Q: Do you appreciate Prime Minister Fukuda's appointments to his
cabinet and party posts?

T P M F
Yes 49 48 50
No 39 46 36

Q: Prime Minister Fukuda was elected LDP president with the leaders
of many intra-LDP factions standing behind him. What do you think
about this? Pick only one from among those listed below.

T P M F
It's the revival of factional politics, so it's not good 36 42 33
It's unavoidable to depend on factions for party unity 38 41 36
Factions' cooperation is needed, so there's no problem 20 14 23

Q: Prime Minister Fukuda's predecessor, former Prime Minister Abe,
upheld constitutional revision and other challenges for reforms. Do
you think Prime Minister Fukuda should take over the Abe cabinet's
policy course?

T P M F
Yes 35 33 36
No 58 63 55

Q: Do you support the previous Abe cabinet?

T P M F
Yes 26 25 27
No 53 61 49
Not interested 15 11 17

(Note) Figures shown in percentage, rounded off. "0" indicates that
the figure was below 0.5 PERCENT . "--" denotes that no respondents
answered. "No answer" omitted. Figures in parentheses denote the
results of the last survey conducted Sept. 12-13. The last cabinet
support rate is for the Abe cabinet.

Polling methodology: The survey was conducted Sept. 25-26 over the
telephone across the nation on a computer-aided random digit
sampling (RDS) basis. Answers were obtained from 828 persons.

(8) Spot poll on Fukuda cabinet, political parties, MSDF refueling
mission (Yomiuri)

YOMIURI (Page 2) (Full)
September 27, 2007

Questions & Answers
(Figures shown in percentage.)

Q: Do you support the Fukuda cabinet?


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Yes 57.5
No 27.3
Other answers (O/A) 2.1
No answer (N/A) 13.2

Q: (Only for those who answered "yes" to the foregoing question)
Pick only one from among the following five reasons for your
approval of the Fukuda cabinet.

Something can be expected of its policy measures 13.2
The prime minister has leadership 7.3
There's something stable about the prime minister 50.4
Its lineup is good 9.0
Because it's a coalition of the Liberal Democratic Party and New
Komeito 11.8
O/A 1.5
N/A 6.8

Q: (Only for those who answered "no" to the foregoing question) Pick
only one from among the following five reasons for your disapproval
of the Fukuda cabinet.

Nothing can be expected of its policy measures 24.9
The prime minister lacks leadership 9.5
There's nothing stable about the prime minister 4.7
Its lineup is not good 19.4
Because it's a coalition of the Liberal Democratic Party and New
Komeito 32.0
O/A 6.3
N/A 3.2

Q: What issues do you want the Fukuda cabinet to pursue on a
priority basis? Pick as many as you like from among those listed
below, if any.

Economic, employment measures 40.1
Consumption tax 36.6
Pension 71.4
Social divide 41.0
Politics and money issues 48.7
O/A 2.1
Nothing in particular 2.1
N/A 0.8

Q: Prime Minister Fukuda has reappointed the greater part of the Abe
cabinet. Do you think this was appropriate?

Yes 66.7
No 21.4
N/A 11.9

Q: The LDP's four top posts, such as the posts of secretary general
and policy board chairman, are now filled by the leaders of its
factions. Do you think it's desirable?

Yes 30.2
No 56.2
N/A 13.6

Q: The government has sent Maritime Self-Defense Force ships to the
Indian Ocean under the Antiterrorism Special Measures Law. The MSDF
ships there are currently engaged in refueling and other activities

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for foreign naval vessels participating in the antiterror campaign
of multinational forces in Afghanistan. The antiterror law for MSDF
activities there is to expire on Nov. 1. Do you support continuing
the MSDF mission in the Indian Ocean beyond the law's Nov. 1
expiry?

Yes 46.9
No 39.7
N/A 13.4

Q: The United Nations Security Council has now adopted a resolution
thanking Japan for the MSDF's antiterror participation in the Indian
Ocean. Do you think this UNSC resolution represents the
international community's endorsement of the MSDF's refueling
mission?

Yes 42.9
No 42.0
N/A 15.1

Q: The Democratic Party of Japan (Minshuto) is opposed to continuing
the MSDF's refueling activities in the Indian Ocean, maintaining
that the UNSC resolution cannot be a ground to justify the MSDF's
refueling mission there. Is this DPJ standpoint convincing to you?

Yes 37.6
No 47.1
N/A 15.3

Q: Do you think it would be better to dissolve the House of
Representatives for a general election as early as possible, or do
you otherwise think there's no need to be in a hurry?

Dissolve the Diet as early as possible 34.8
No need to be in a hurry 58.1
N/A 7.1

Q: Which political party do you support now? Pick only one.

Liberal Democratic Party (LDP) 37.6
Democratic Party of Japan (DPJ or Minshuto) 24.4
New Komeito (NK) 4.5
Japanese Communist Party (JCP) 2.7
Social Democratic Party (SDP or Shaminto) 1.2
People's New Party (PNP or Kokumin Shinto) 0.1
New Party Nippon (NPN or Shinto Nippon) ---
Other political parties ---
None 27.6
N/A 1.8

Polling methodology: The survey was conducted across the nation over
the telephone from 8 p.m., Sept. 25 through Sept. 26. For the
survey, respondents were chosen on a computer-aided random digit
dialing (RDD) basis. A total of 1,557 households were found to have
one or more eligible voters. Valid answers were obtained from 926
persons (60 PERCENT ).

(9) Poll on Fukuda cabinet, political parties (Asahi)

ASAHI (Page 4) (Full)
September 27, 2007


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Questions & Answers
(Figures shown in percentage, rounded off. Bracketed figures denote
proportions to all respondents. Figures in parentheses denote the
results of the last survey conducted Sept. 15-16.)

Q: Do you support the Fukuda cabinet?

Yes 53
No 27

Q: Why? (One reason only. Left column for those marking "yes" on
previous question, and right for those saying "no.")

The prime minister is Mr. Fukuda 25(13) 10(3)
It's an LDP-led cabinet 20(11) 49(13)
From the aspect of policies 22(12) 27(7)
No particular reason 30(16) 8(2)


Q: Which political party do you support now?

Liberal Democratic Party (LDP) 33 (32)
Democratic Party of Japan (DPJ or Minshuto) 25 (24)
New Komeito (NK) 4 (1)
Japanese Communist Party (JCP) 3 (2)
Social Democratic Party (SDP or Shaminto) 1 (1)
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 30 (35)
No answer (N/A) + don't know (D/K) 4 (5)

Q: Do you think Mr. Fukuda is a politician close to public
sensitivity?

Yes 38
No 41

Q: Do you think Mr. Fukuda is a person of action?

Yes 46
No 32

Q: Do you think Mr. Fukuda has a sense of balance?

Yes 58
No 22

Q: The new cabinet has retained many of the previous Abe cabinet. Do
you think it was good?

Yes 55
No 27


Q: Do you think the LDP has now returned to its old self when you
saw how the Fukuda cabinet was launched?

Yes 56
No 29

Q: Do you think the LDP will change for the better, change for the

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worse, or remain unchanged under Prime Minister Fukuda?

Change for the better 22
Change for the worse 6
Remain unchanged 65

Q: Do you have expectations for the Fukuda cabinet's efforts to deal
with pension issues among its policy challenges?

Yes 67
No 26

Q: Do you have expectations for the Fukuda cabinet's efforts to deal
with economic disparities?

Yes 49
No 41

Q: Do you have expectations for the Fukuda cabinet's efforts to deal
with diplomatic issues?

Yes 55
No 34

Polling methodology: The survey was conducted over the telephone
from the evening of Sept. 25, when the cabinet roster was announced,
through the evening of Sept. 26, 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 908 persons (55 PERCENT ).

(10) Understanding Prime Minister Fukuda from his sayings

TOKYO SHIMBUN (Page 26 &27) (Full)
September 27, 2007

Prime Minister Yasuo Fukuda is described as a coolheaded and
consensus-oriented politician. He is also said to be a person with
commonsense and a late starter as a politician. The words describing
Fukuda are completely different from those for former prime
ministers Shinzo Abe and Junichiro Koizumi. At the age 53, Fukuda
was elected to the House of Representatives for the first time. He
assumed the prime minister's post on Sunday at the age of 71, the
same age his father was when he became prime minister. The newspaper
probes into whether words describing Fukuda's personality were
appropriate, based on his past sayings and a book he published two
years ago.

Ironist

Fukuda worked as chief cabinet secretary for two prime ministers --
Yoshiro Mori and Koizumi -- from October 2000 to May 2004. He held
two press conferences every day at the Prime Minister's Official
Residence. He often baffled the press by giving ironical answers and
laughing to himself.

In January 2001, when he returned Takasaki City, Gunma Prefecture,
for the first time after becoming chief cabinet secretary, Fukuda
told a self-effacing joke to his supporters: "I am the 'excuse'
chief cabinet secretary. I will likely continue to make excuses for
a while."


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At the time the Mori government suffered from poor popular support.
Fukuda complained about the prime minister, saying, "Since Prime
Minister Mori is big, he meets with strong resistance when the wind
blows. Therefore, we are having a difficult time."

As the cabinet spokesman, Fukuda continued to bear the brunt of
criticism from the opposition and the media. Due to the accumulated
stress, he often severely attacked the opposition camp.

In September 2003 when asked by reporters about a manifesto that the
opposition was drafting for the new Lower House election campaign,
Fukuda flatly responded: "I assume that those who don't have to bear
responsibility for what they write will write as they wish."

Asked at a press conference in November 2003 to comment on the list
of shadow cabinet members the Democratic Party of Japan (DPJ) had
made, Fukuda responded: "It is a virtual government, isn't it? It's
free to do so."

When the voting on a no-confidence motion against the cabinet was
thrown into turmoil by an incident of Lower House member Kenshiro
Matsunami throwing a glass of water at a member of the then
Conservative Party (Hoshuto) at the Lower House plenary session,
Fukuda commented: "The DPJ's young lawmaker's fuss is embarrassing.
His behavior was worse than a kid's."

The opposition party fiercely rebutted remarks, "worse than a kid."
Fukuda then was forced to offer an apology to the opposition next
day, saying, "It was an inappropriate expression."

In January 2004 when DPJ Lower House member Junichiro Koga's college
degree flap came up, Fukuda criticized Koga, saying, "Lying is the
road that leads to stealing."

Three months later, however, it was discovered that Fukuda had not
paid his own pension premiums, and he was forced to step down in May
2004.

Counteroffensive

The new prime minister is known for having a warm personality and
for being a well-balanced person, but he often expressed his
personal pique at press conferences, putting questions to reporters.


Commenting on his violation of his pledge to keep government bond
issuance at 30 trillion yen, then Prime Minister Koizumi said, "It's
not a big deal." He then came under criticism from the ruling and
opposition camps. In his speech delivered Takasaki City in January
2003, Fukuda flatly rejected the criticism, saying:

"There is no need to make a fuss about the fact that 30 trillion yen
became 34 trillion yen. They should highly value the prime
minister's stance of not changing his structural reform drive."

Several ministers in the Abe cabinet stepped down from their posts
due to many scandals. Fukuda as chief cabinet secretary in the Mori
cabinet saw the resignation of Economic and Fiscal Minister
Fukushiro Nukaga. While serving as chief cabinet secretary in the
Koizumi cabinet, he also faced the resignation of Agriculture
Minister Tadamori Oshima. When the Prime Minister's Official
Residence's background check on cabinet members was criticized,

TOKYO 00004557 013 OF 022


Fukuda rebutted:

"It is almost impossible to check everything beforehand. I wonder
there is any perfect person. If we politicians have to take
responsibility for what our secretaries did, we will have to know
each action taken by them. In reality, it is impossible for us to do
so."

When he was criticized for getting support from eight factions in
his party as "faction bid-rigging," in the recent LDP presidential
race, expressed his displeasure, saying: "You should better not talk
about a low-level thing."

At a press conference after he won the LDP presidency, Fukuda told
reporters when asked about his analysis of his victory in the
election: "I rather want you to let me know."

Self-confident person

Fukuda is a person who has confidence in himself. He was the
longest-serving chief cabinet secretary, a position that brought him
eventually to the prime minister's post. He told his supporters in
Gunma Prefecture in June 2001: "The chief cabinet secretary's post
is the last cabinet post I want to serve. I think I will be able to
do better job if I assume other cabinet post."

Pi became a symbol of the so-called pressure-free education system,
the new educational guideline introduced in 2002. As to the
cram-free education that allows schools to teach students the value
of pi is almost 3.0, Fukuda commented: "I don't understand that
students can remember the value of pi being 3.0 but they cannot
remember 3.14. I still remember pi=3.14159265358...."

In April 2005, one year after he resigned as chief cabinet
secretary, Fukuda published a book along with Seijuro Eto, a member

SIPDIS
of the Mori faction (currently the Machimura faction). He wrote in
the book:

"Anyone who cannot serve as prime minister for four years should not
seek that position. A person who says I will do my best for one year
should not become prime minister. After compiling the budget three
or four times, not only once, that budget can be implemented."

At a press confidence after assuming the prime minister's post on
Sept. 25, Fukuda defined his cabinet, saying: "I call my cabinet,
the one that will fight with its back to the wall. Even if it makes
only one mistake, it may lose power. We must maintain a tense
atmosphere."

(11) Fukuda office altered receipts for 2006 funds report

ASAHI (Page 35) (Abridged slightly)
September 28, 2007

Political funds reports for 2006 filed by the Liberal Democratic
Party Gunma Prefecture No. 4 branch office headed by Prime Minister
Yasuo Fukuda (representing the House of Representatives Gunma No. 4
constituency) and a related political organization were affixed with
copied receipts with altered names on them, the Asahi Shimbun has
learned. The names of the recipients were changed into the political
organization or the LDP branch office. The alterations were made by
Fukuda's office instead of the issuers. Seventeen modified receipts

TOKYO 00004557 014 OF 022


for a total of 5.7 million yen were attached to the reports.

A Fukuda office source said: "We should have asked the issuers to
change the names of recipients. We would like to study measures to
be taken."

According to the copies of funds reports and copied receipts,
disclosed at the request of the Asahi Shimbun, altered receipts were
attached to the 2006 fund report by the LDP branch office. They were
part of the 2.2 million yen disbursed as political activities
expenses. One of them was the receipt for some 70,000 yen for a
meeting, issued on Sept. 28, 2006 by a hotel in Takasaki City, Gunma
Prefecture. The receipt originally carried the name of Fukuda Keizai
Kenkyu-kai (economics study group), but it was crossed over and was
changed into the LDP Gunma No. 4 branch office. A total of five
receipts were modified in the same way.

Additionally, four receipts carried the name of the LDP branch
office overwritten on the name of another office or in what seemed
to be a blank. There were six more bank payment slips that carried
the party name.

Two post office receipts for Fukuda Keizai Kenkyu-kai, apparently
modified from the LDP branch office, were also attached to the 2006
funds report filed by the Kenkyu-kai.

In an Asahi Shimbun interview, the Corporate Taxation Institute
(CTI) in Tokyo, which is totally responsible for checking the Fukuda
office's political funds, offered this explanation: "Around in 2004,
the main body conducting political activities was shifted from the
personal political organization to the party (branch), but many
outside people have not recognized the change." Regarding suspicion
that the Fukuda office transferred expenses, the CTI said: "Such
suspicion is natural. We would like to study ways to improve the
current situation."

(12) Fukuda-led branch office, political groups found to have
rewritten addresses on receipts worth 5.8 million yen

YOMIURI NET
12:36, September 28, 2007

It was learned yesterday that the Liberal Democratic Party's Gunma
Prefecture 4th electoral district branch office in Takasaki City,
led by Prime Minister Fukuda, and his political groups had rewritten
or added addresses on photocopied receipts.

Such corrections had been made on 17 receipts for expenditures
totaling approximately 5.8 million yen. Chief Cabinet Secretary
Machimura said in a press conference held after a cabinet meeting
yesterday morning: "I received an explanation about the
circumstances directly from the prime minister. His understanding is
that there was no illegality. I believe he will properly deal with
the matter."

According to data that the Gunma prefectural election administration
commission disclosed in response to a request by the Yomiuri
Shimbun, the LDP Gunma Prefecture 4th branch office crossed out with
double lines such addresses as the Chiyoda Economic Council, a
funds-management organization for Fukuda, and the Fukuda Economic
Research Council, a related political group, on eight receipts -
worth about 1.05 million yen - issued by Japanese restaurants and

TOKYO 00004557 015 OF 022


others in 2003, 2004, and 2006 and rewrote them into the branch
office.

It was also found that the name of an electoral district branch
office had been added to seven receipts to the Fukuda Yasuo Office
issued in 2006. The receipts were worth 4.55 million yen in total.

In addition, there were two cases in 2006 in which the Fukuda
Economic Research Institute changed the 4th electoral district
branch office into the institute on copied receipts worth a total of
approximately 200,000 yen.

(13) Prime Minister Fukuda: "I feel really ashamed" of political
funds problem

ASAHI NET
13:47, Sept. 28, 2007

It has been reported that a political group headed by Prime Minister
Fukuda was found to have rewritten the addresses of receipts
attached to their political funds reports. On this problem, Fukuda
told reporters at the Prime Minister's Office at noon today:

"Accountants probably wanted to save the trouble of re-collecting
receipts. I think the personnel did not think that correcting
records was wrong. But that was totally undesirable in view of
office management. There was neither an intention of benefiting by
it, nor did we do anything dishonest."

Fukuda said that he had not known about the corrections until he was
informed of it, adding: "I feel really ashamed as the chief
executive."

(14) Ibuki-headed LDP branch office received illicit donations from
money-losing company for over three years

ASAHI (Page 35) (Abridges slightly)
September 28, 2007

The Liberal Democratic Party Kyoto branch office headed by a
secretary to Secretary General Bunmei Ibuki (representing House of

SIPDIS
Representatives Kyoto No. 1 district) received donations for at
least four years from the Kyoto Hotel, which suffered a cumulative
debt for over 10 years, the Asahi Shimbun has learned. The Political
Funds Control Law prohibits companies suffering from a cumulative
debt for over three consecutive business years from making political
donations and lawmakers knowingly receiving donations from such
companies. An Ibuki office official indicated that the branch office
had been totally unaware that the firm was in the red.

According to political funds reports and other documents, the hotel
donated 120,000 yen annually to the branch office between 2003 and
2006. Although the hotel suffered an accumulative debt from 1993
through 2005, it reportedly climbed out of the red when the accounts
were settled for 2006.

Kyoto Hotel general affairs manager Kitada took said: "We disbursed
the money as annual fees, not as donations. We would like to build a
system allowing the management department to examine expenses
closely so as not to cause any perception gaps."

The branch office in question is located in Ibuki's Kyoto office in

TOKYO 00004557 016 OF 022


Shimokyo-ku, Kyoto City. The branch office received some 47 million
yen from over 200 companies and organizations in 2005.

(15) Diet to reopen at long last for a showdown; LDP to present new
bill before antiterror law loses its effect

MAINICHI (Page 2) (Abridged)
September 27, 2007

The Diet will now resume its current extraordinary session. Prime
Minister Yasuo Fukuda and his cabinet will first face a
parliamentary debate between the ruling and opposition parties over
three issues: 1) extending the Antiterrorism Special Measures Law;
2) dealing with politics-and-money problems; and 3) reforming the
nation's pension system. The new prime minister weighs holding talks
with the leading opposition Democratic Party of Japan (DPJ).
However, DPJ President Ichiro Ozawa shows no willingness to
compromise, maintaining that his party cannot translate its
standpoints into action unless it takes the reins of government. The
ruling and opposition benches are expected to heat up their battle
of words in the public eye while anticipating that the House of
Representatives may be dissolved for a general election.

Antiterror legislation

On the evening of Sept. 25, Prime Minister Fukuda called at the room
of DPJ executive officers in the Diet after he was elected prime
minister. Fukuda met Ozawa there. However, there was no conversation
between the two.

"The DPJ now holds real power in the House of Councillors, so we
have to talk with the DPJ," Fukuda said in a press conference on
Sept. 23 after becoming LDP president. He was referring to the issue
of extending the antiterror law in order for the Maritime
Self-Defense Force to continue its current refueling activities in
the Indian Ocean.

However, the DPJ is concerned about the fact that Operation Enduring
Freedom (OEF), an antiterror drive involving the MSDF, is not a
collective security step set up with a United Nations resolution.
The DPJ is calling for the MSDF's withdrawal, taking the position
that OEF actually is a "US war." The DPJ is almost unlikely to
approve extending the MSDF's refueling mission.

Nevertheless, the new prime minister is taking a low profile. One
government official explained why: "Even if it's impossible to
expect the DPJ to change its stance, he will carefully explain that
Japan is appreciated by the international community. He is aiming to
get public support for continuing the MSDF's refueling activities."

The antiterror law is to expire on Nov. 1. In the meantime, the Diet
will close its current extraordinary session on Nov. 10. Even if the
government introduces a bill to the Diet during its current session
to extend the law, the time left is too short to deliberate on the
legislation. As a result, the legislation is highly likely to be
scrapped. The new premier noted the importance of sending a message
to the international community. Basically, the government, before
the antiterror law loses its effect, will present a legislative
measure to create a new law that alters the MSDF's refueling
activities.

The new antiterror legislation, however, will likely have a direct

TOKYO 00004557 017 OF 022


bearing on the issue of extending the current Diet session. One LDP
defense-lobby lawmaker says: "If we present the new bill during the
current Diet session, it could end up with dissolving the House of
Representatives. The bill should be put on hold until the ordinary
Diet session." The new premier is urged to show a cautious response
while coordinating with the ruling coalition.

(16) Fate of correction of social disparities: Striking balance with
fiscal reconstruction is challenge

YOMIURI (Page 9) (Slightly abridged)
September 28, 2007

Correcting social disparities caused by structural reforms is a
pending issue challenging the Fukuda cabinet. Both the ruling and
opposition parties are strengthening their calls for expanding
expenditures for regional areas and the elderly, who were left
behind when the economy began to grow again. A concrete path for
correcting the reform policy while striking a balance between
correction of social disparities and fiscal reconstruction has not
yet come into sight.

Finance Minister Nukaga in an interview to the Yomiuri Shimbun and
other dailies stressed the need to correct income and social
disparities, noting, "We will correct the downside of the structural
reform policy, which has appeared as structural reforms have been
implemented. Correcting disparities between the urban and rural
districts and providing job opportunities to young people are
pending issues."

Fiscal reconstruction has made headway under the Koizumi and Abe
reform drive. However, local economies have become impoverished due
to cuts in public works. An increase in non-regular workers, such as
part-timers and dispatched workers, has widened income disparities.


In Akita Prefecture, minimum wage per hour is 618 yen, which is the
lowest among all prefectures along with Okinawa Prefecture. The
amount is 121 yen lower than that of Tokyo, which ranks first.
Senior Managing Director Takahashi of the Akita Prefecture
Management Association complained of difficulties his prefecture is
faced with, noting, "We want the government to implement necessary
public works, such as the construction of highways. The business
sentiment in the prefecture is harsh. There are few job
opportunities."

Prime Minister Fukuda during his inauguration speech on Sept. 26
categorically said, "I will take measures to deal with individual
disparity caused by the implementation of the reform policy."

Basic policy guidelines on economic and fiscal management and
structural reforms to be implemented

Fukuda is also paying close attention to fiscal reconstruction. He
wants to avoid scattering about pork-barrel largesse, as he stressed
during the LDP presidential election campaign, "Since the budget is
limited, we must use our resourcefulness."

Some in the market take the view that Fukuda would firmly maintain a
fiscal reconstruction policy, as can be seen in his appointment of
former Finance Minister Tanigaki, whose pet argument is that the
consumption tax should be raised, as Policy Research Council

TOKYO 00004557 018 OF 022


chairman.

Fukuda reappointed all economic ministers from Abe's reshuffled
cabinet. His orders given to State Minister in charge of
Rejuvenating Local Economies included a plan to press ahead with
fiscal reconstruction, by implementing the basic policy guidelines
on economic and fiscal management and structural reforms compiled in
May under the Abe administration. The guidelines include the further
delegation of power to local governments and tax and fiscal
reforms.

Policy of reconstructing regional districts to be maintained

Orders given by Fukuda also include a policy of striking a balance
between correction of social disparities and fiscal reconstruction.
The Council on Economic and Fiscal Policy (CEFP), the central
command of structural reforms, planned to set reconstruction of
local economies as a main agenda item on Sept. 12, when former Prime
Minister Abe announced his decision to step down. The Fukuda cabinet
will likely maintain this policy.

The Cabinet Office, which is in charge of the CEFP, intends to
realize policies that will require less fiscal disbursements, such
as the establishment a local power revitalization organ intended to
reconstruct local businesses and joint public-private ventures,
measures to help young people, such as so-called freeters
(job-hopping part-time workers) and single-mothers find jobs.

The Ministry of Agriculture, Forestry and Fisheries (MAFF) plans to
reconstruct regional districts by promoting reform instead of fiscal
disbursements, based the aggressive agricultural policy set by the
Abe administration. Measures under this policy include management of
large-scale agriculture and promotion of entry of companies in the
agricultural area.

However, measures proposed by the Cabinet Office have not been
received well, being seen as minor. It cannot be said that the
aggressive agricultural administration was supported by farmers in
the July Upper House election. Fukuda in the inauguration speech
made a delicate correction to that policy, noting, "I would like to
create an environment in which small-scale farmers can feel at
ease."

The LDP and the New Komeito during power-sharing talks on Sept. 25
agreed to consider putting on hold plans to increase a medical
burden to be shared by the elderly and to cut portions of child
benefits as measures to address disparities in the social security
area. The fiscal burden to be shouldered by the state is estimated
to reach 100 billion yen. How to secure funding resources would
depend on the development of talks between the government and the
ruling camp.

If the government shifts to a policy of scattering about pork-barrel
largesse in a hurry to come up with attractive measures to address
disparities, it would be not able to gain trust from either the
international community or the market, as State Minister in charge
of Economic and Fiscal Policy Ota put it. The Fukuda cabinet will
likely be pressed to steer the economy between efforts to correct
social disparities and efforts to reconstruct public finances.

(17) Keizai Kyoshitsu (Economic Classroom): Post-Abe politics --
ideals and policy (part 1); Do not allow reactionary politics to

TOKYO 00004557 019 OF 022


become rampant; Continuation of reform drive at crucial state;
Revitalization of local communities based on agriculture,
decentralization

NIKKEI (Page 19) (Full)
September 21,2007

Article by Heizo Takenaka, professor at Keio University

The trend of protecting vested interests is gaining ground in Japan
out of fear of the negative impact of globalization. The new
administration should hold its own in order to prevent reactionary
politics from becoming rampant. Rural regions boosted by
agricultural reform and the promotion of decentralization hold the
key to reinvigorating the Japanese economy, which is somehow
starting to unravel due to the aftereffects of the Koizumi
structural reform initiative.

Perception gap between market and politics widening rapidly

Prime Minister Abe's sudden announcement that he was quitting his
post was indeed a shocking event. The selection of the next Liberal
Democratic Party (LDP) president and the next prime minister is at
this writing underway. Power games are a matter of daily occurrence
in the political world. However, what is going on now is the
selection of candidates based on factional interests, which is
nothing but the LDP returning to its old-style factional politics.
It would be logical for candidates to come forward with policy
proposals so that voters can decide for whom they should cast their
ballots. However, what is happening in reality is that LDP lawmakers
first try to form interest groups and then put forward policy
arguments. We must avoid by all means reactionary politics from
derailing the reform drive.

The environment surrounding the Japanese economy does not allow for
optimism. The gross domestic product (GDP) for the second quarter of
this year marked negative 1.2 PERCENT growth in annual terms. When
stock prices plunged on the global market, hit by the sub-prime loan
fiasco, Japanese stocks suffered the largest drop among leading
countries. Since the settlement of the non-performing loan disposal
and postal privatization issues, there have been carried out few new
reforms that drastically changed institutional frameworks. Under
such circumstances, what is propping up the Japanese economy is the
aftereffect of the Koizumi reform drive. World leaders at the World
Economic Forum, Summer at Davos, held in Dalian, China, took a harsh
view of Japan, suspecting that its economy might have weakened again
because reactionary politicians depend on the government to prop
things up.

An overwhelming number of market players are hoping for the
continuation and strengthening of reform. On the other hand,
Japanese politicians are strongly calling for reviewing the reform
policy. Gaps between the market and politics over reform are rapidly
widening.

Personnel appointments for government-affiliated financial
institutions a major touchstone

In one of his last policy speeches, Prime Minister Abe basically
advocated an emphasis on the continuation of the reform initiative.
He noted that he would do his utmost to materialize politics that is
kind and gentle to people, using the words "the downside of the

TOKYO 00004557 020 OF 022


reform policy." This has given rise to expectations that public
investment would spread to regional areas. Given the fact that the
reform drive was slow even under Prime Minister Abe, an advocate of
the Koizumi reform initiative, pressure to end the reform policy
would be enormous if those calling for a policy switch have a high
profile in politics.

Opponents of reform policy claim adamantly that it has impoverished
rural districts. It is true that local economies have become
impoverished, leaving a host of policy problems to be resolved.
However, impoverished local economies are not the downside of the
reform policy. It is doubtful that local economies would not have
become impoverished if non-performing loans had been left unattended
and if postal services had not been privatized. Local economies have
become impoverished because local industries and companies have lost
their competitiveness due to the globalization of the economy and a
shift to an information-intensive society.

There is no panacea to solve this problem. Two things must be done
first, though the situation is harsh. The first matter is to adopt a
drastic policy aimed at strengthening agriculture, as a key
industry. There can be no revitalization of local communities
without the revitalization of agriculture. To be precise, it is
necessary to further promote competition policy and press ahead with
structural reforms including reform of agricultural cooperatives.
Second, decentralization should be further promoted. If a doshu or
regional bloc system is to be established, it would be the
responsibility of regional blocs to consolidate the infrastructure
of regional districts. Those blocs will also be responsible for
adopting a policy for local industries. It is necessary to swiftly
and powerfully move forward with decentralization like this.

In other words, the impoverished local economies are the downside of
globalization. Further structural reforms are needed in order to
settle this problem. Local economies have become impoverished,
because reform efforts were insufficient. If we stop our reform
efforts now, the Japanese economy would lose its competitiveness in
the world. As a result local economies will become further
impoverished.

"Gentleness and warmth" and "bonds" are just political slogans. No
explanations have been given regarding what policies are to be
implemented under such slogans. We must not allow the government to
expand public finance as a stopgap measure and to return to an
old-style politics of protecting those who are enjoying their vested
interests, using expressions that are pleasant to the ear.

Recent discussions of economic policy remind me of arguments between
Marxist economists and modern economists that took place in the
1970s. Arguments in those days supposedly concluded that amid the
harsh international economic situation, it would not be possible to
enhance the economic welfare of the public without a strong economy
and an economy that can grow and that deregulation and competitive
policy are necessary in order to create an economy that can achieve
solid growth.

It is only natural to implement the policies that have already been
adopted, including basic policy guidelines on economic and fiscal
management and structural reforms. However, it is not possible to
realize an economy that can achieve solid growth only with existing
policies. It is imperative to press ahead with bold new policies,
such as drastic educational reform that includes the privatization

TOKYO 00004557 021 OF 022


of Tokyo University, further promotion of the "open sky policy and
reform of the management of foreign exchange reserves (establishment
of Japanese equivalent of government investment corporation (GIC).

In reality, however, a political trend of protecting vested
interests, blaming the reform policy for the negative impact of
globalization in stead of tackling it, is rising. The following
three points symbolize this trend.

First, there is a move to allow more postal rebels to return to the
LDP. The reinstatement of postal revels last year has triggered the
decline of cabinet support ratings. And yet, the old guard nature of
the LDP that wants to see the return of more postal rebels is seen
in this move. The move indicates the overt resurrection of Diet
policy cliques.

Second, a bureaucrat-led decision-making process is beginning to
come back to life, while a politically-driven policy-making process
is stepping back. Postal privatization would not have realized if
the job had been left up to postal bureaucrats. It is impossible to
regulate amakudari (golden parachute) practices at the initiative of
bureaucrats.

Nevertheless, an atmosphere of tolerating the revival of
bureaucratic power is permeating in the name of "fully utilizing
bureaucrats." The selection of top officials of
government-affiliated financial institutions, which is to take place
shortly, will be the major litmus test in telling the revival of
bureaucratic power.

Third, disciplines for budget compilation are weakening, as can be
seen in the move to boost public works. It is of concern that local
governments might be tempted to increase public works in response to
the prime minister's policy speech.

Diet policy cliques, bureaucrats' initiative and public works indeed
make a set that gave rise to the lost decade of the 1990s. They are
symbols of the ancient regime. Amid Nagatacho (Diet) being enveloped
with a mood that Lower House dissolution and a snap election would
be imminent, a new prime minister and thinking legislators are urged
to hold their own so as not to allow reactionary politics to
prevail.

CEFP shift concept

American political economist A. Harshman noted that an "exit" and
"voice" are needed in settling social issues. The exit means an
election through which people can express their disapproval of the
government. However, before that, there must be various voices
calling for continuation and promotion of the reform policy.

Whatever administration will come into existence this time, the fact
that the opposition dominates the Upper House will remain unchanged
for the time being. It has been pointed out that the role of the
Council on Economic and Fiscal Policy (CEFP)has diminished for the
past few years. Its role will further decline.

The panel needs to reverse its way of thinking. It had difficulty
consolidating views centered on the prime minister, while
private-sector members throwing a ball aiming high in order to fight
forces of resistance. For this reason, it has been forced to make
concessions frequently. However, it is now no longer necessary for

TOKYO 00004557 022 OF 022


the panel to put together various opinions, because even if does so,
if its proposal is rejected by the Diet, that would be the end of
it. That is why private-sector members are entitled to pursue just
arguments in a far-reaching manner. The panel should fairly and
squarely pursue discussions of originally proposed reform items,
because it has avoided those areas out of consideration to concerned
government offices and their ministers. Such items include
privatization of Tokyo University and the establishment of a
Japanese equivalent of the GIC. Private-sector members should
vocalize their views to explore possibilities of their stand being
reflected in policy talks.

If reactionary politics touting slogans pleasant to the ear
undermines the reform policy even slightly, it will be the public
who will shoulder the burden totally. This is a fundamental issue of
how each individual face the state and how political leaders respond
to such a stance shown by individuals.

Some people tend to rely on the state, blaming its reform policy, if
they feel they are disadvantaged. Politics then caters to the wishes
of those people. This pattern is the very point which Yukichi Fukuda
warned of when Japan was at the threshold of constructing a modern
nation. Since there is concern about the fate of the reform policy,
it is necessary (for leaders) to learn from the noble ambition of
Fukuzawa, who noted at every tune that one should support the state
but should not depend on it, based on the perception that politics
of a country is determined by the level of its people.

Heizo Takenaka: Born in 1951. Obtained PhD from Osaka University.
Served as state minister in charge of economic and fiscal policy.
Now special advisor to the Japan Economic Research Center.

SCHIEFFER

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