Cablegate: Japanese Morning Press Highlights 11/19/08

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Defense and security affairs:
1) Prime Minister Aso says he is considering an anti-piracy role for
Maritime Self-Defense Force (Yomiuri)
2) Special measures law being considered that would allow dispatch
of MSDF to waters off Somalia to protect commercial ships from
pirates (Nikkei)

Diet agenda:
3) Diet session likely to be extended to allow passage of the bill
that extends the MSDF refueling mission in the Indian Ocean
4) 25-day extension being considered for the current extraordinary
session of the Diet (Tokyo Shimbun)
5) Democratic Party of Japan (DPJ) breaks promise to allow passage
of the refueling mission bill during the current Diet session
6) Second supplementary budget to be presented to the next regular
Diet session, not the current on, says Diet Affairs Committee chair

Aso diplomacy:
7) Prime minister's policy course for next fiscal year aims at
strengthening diplomacy, security (Sankei)
8) Aso gives up on possibility of meeting President-elect Obama
prior to inauguration (Nikkei)
9) Aso's plan to hold the next G-20 meeting in Japan is shipwrecked
(Tokyo Shimbun)
10) High-level economic meeting between Japan and China is postponed

11) Reporter's notebook: Is America removing the yoke of 9/11?

12) With tax revenues down 6 trillion yen due to the recession,
government to increase issuance of deficit bonds to cover the gap


1) Aso eyes MSDF dispatch for antipiracy mission

YOMIURI (Page 4) (Abridged)
November 19, 2008

Prime Minister Aso met with Masahiro Akiyama, a former vice defense
minister and chairman of the Ocean Policy Research Foundation
(OPRF), and others at his office yesterday and indicated that he
would consider proposals from the OPRF and other bodies insisting on
the necessity of sending Maritime Self-Defense Force ships for
antipiracy operations in waters off the coast of Somalia in Africa.

In the government, the Headquarters for Ocean Policy is now studying
antipiracy measures, including the option of sending the
Self-Defense Forces. However, the government also deems it difficult
to send the SDF under the current law. "The SDF is to be engaged in
maritime security operations for emergencies like when Japanese
ships come under attack," a senior official of the Defense Ministry
said, "and it's difficult to engage the SDF in maritime security
operations for antipiracy operations for a long period of time."

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In the meeting, Akiyama handed a report of policy proposals to the
prime minister, featuring such options as sending Maritime
Self-Defense Force vessels for fact-finding purposes to provide
information to foreign naval vessels about pirates and issuing an
order for maritime security operations under the Self-Defense Forces
Law if and when there was an act of piracy. Akiyama's proposal is to
send the SDF under the current law. In the meeting with the prime
minister were former Defense Agency Director General Gen Nakatani
from the ruling Liberal Democratic Party and Akihisa Nagashima,
deputy secretary general of the leading opposition Democratic Party
of Japan (Minshuto), who are members of a nonpartisan parliamentary
group of young lawmakers to establish a security system for the new

2) Gov't mulls special law for MSDF antipiracy mission off Somalia

NIKKEI (Page 1) (Abridged)
November 19, 2008

The government is considering special legislative measures to send
Maritime Self-Defense Force vessels to waters off the coast of
Somalia in order to guard commercial freighters against pirates. The
MSDF's antipiracy operations would be limited to offshore areas near
the Somalia coast. The MSDF would guard not only Japanese commercial
ships but also foreign ships. The government will decide whether to
present a bill to the Diet at its next ordinary session after seeing
the attitude of the leading opposition Democratic Party of Japan
(Minshuto). The planned legislation will likely be controversial due
to such issues as the rules of engagement (ROE) or guidelines for
the MSDF to use weapons.

In addition to special legislation, the government is also looking
into the feasibility of creating a general law allowing Japan to
engage the MSDF in activities anywhere in international waters.
Since coordination will take time, the government will likely
present a special measures bill to the ordinary Diet session to
fast-track it.

The planned special antipiracy legislation is intended to engage the
Self-Defense Forces in such activities as escorting tankers and
other commercial ships off the coast of Somalia. The MSDF, when
spotting pirate ships, will halt them in order to prevent commercial
ships from being attacked. MSDF vessels, if and when they came under
attack from pirate ships, will use armed force that is needed for
legitimate self-defense. The government is also considering the
option of dispatching P-3C patrol aircraft for over-the-water

There is also a plan to detain and prosecute pirates in Japan.
However, the government will not incorporate this option in the
planned special measures law. Instead, the government is considering
incorporating it in a general law. MSDF destroyers dispatched under
the special measures law will ask foreign naval vessels to crack
down on pirates when spotting them.

3) Diet extension until around Dec. 22 likely for refueling bill

MAINICHI (Page 1) (Full)
November 19, 2008

The government and the ruling parties decided yesterday to extend
the current extraordinary Diet session, which is set to end Nov. 30,

TOKYO 00003180 003 OF 008

in order to pass a government-introduced bill amending the new
Antiterrorism Special Measures Law to extend the Maritime
Self-Defense Force's refueling activities in the Indian Ocean. It is
Dec. 20 when the bill can be passed by a majority of two-thirds or
more in a second vote of the House of Representatives as stipulated
in the Constitution. The day is weekend, so the ruling parties are
likely to extend the Diet session until around Dec. 22.

Meanwhile, the leading opposition Democratic Party of Japan
(Minshuto) decided yesterday not to take a vote on the new
antiterror legislation and a financial bill unless the government
presents a second supplementary budget for fiscal 2008 to the Diet.
An extraordinary Diet session can be extended twice, so the
government and the ruling parties are also looking into the
possibility of reextending the current extra Diet session until
early January next year while seeing the DPJ's attitude toward the
financial bill.

4) Diet session to be extended; Government, ruling camp to
coordinate views on extending it for 25 days

TOKYO SHIMBUN (Page 1) (Abridged slightly)
November 19, 2008

The government and the ruling coalition decided yesterday to extend
the current extraordinary Diet session beyond its Nov. 30 ending.
The primary purpose is to enact the bill amending the New
Antiterrorism Special Measures Law to extend the refueling mission
in the Indian Ocean, now under deliberation at the House of
Councillors, by a House of Representatives' overriding vote. They
will coordinate views on extending the session for about 25 days and
make a final decision while closely monitoring the major opposition
Democratic Party of Japan's response.

The decision to extend the session follows the DPJ's adoption of a
policy course of refusing to take votes on bills amending the
refueling law and the bank strengthening law at the Upper House
unless the government presents a fiscal 2008 second supplementary
budget. Prime Minister Taro Aso told reporters at his residential
office last night: "These are extremely important bills. We
naturally must deal with them properly by extending (the session),
depending on how the other side moves."

Even if the Upper House does not take a vote, the Lower House is
allowed under the Constitution to readopt the refueling legislation
by an overriding vote 60 days later by regarding the upper chamber's
inaction as de facto rejection. The vote would come on Dec. 20 at
the earliest.

There is a view in the government and the ruling bloc that the
session should be extended until Jan. 5 or later so that in case the
DPJ refuses take a vote, the ruling camp would be able to use a
two-thirds overriding vote in the Lower House to get the financial
institutions strengthening legislation enacted at the same time
under the 60-day rule. Moreover, because an extra Diet session can
be extended twice, some are also calling for extending the session
until late December and re-extending it later on.

5) DPJ breaks off agreement on vote on refueling bill, evoking
objections from even party members

NIKKEI (Page 2) (Full)

TOKYO 00003180 004 OF 008

November 19, 2008

The Democratic Party of Japan (DPJ) boycotted a planned vote on a
bill to extend the Maritime Self-Defense Force's refueling mission
in the Indian Ocean in a meeting of the House of Councillors'
Foreign Affairs and Defense Committee yesterday. The main opposition
party's attitude reflects its strong reaction to the fact that the
Prime Minister Taro Aso did not promise in a meeting with DPJ
President Ichiro Ozawa to submit a second extra budget bill to the
current Diet session. In the DPJ, however, dissatisfaction is
smoldering at the party's breach of an agreement reached with the
ruling camp in an executive board meeting. In the party, the Upper
and lower House caucuses have made different responses.

A member of the DPJ Upper House Secretariat said that since an
agreement at the executive board is unofficial, it is not rare for
an agreement there to be overridden. But another member grumbled:
"Agreements between the ruling and opposition parties could be
broken off anytime." In a meeting of the Diet Affairs Committee
chairmen of opposition parties yesterday, the Japanese Communist
Party and the Social Democratic Party voiced criticism of the DPJ's
strategy, one member assailed: "It is irrational to involve the
second extra budget in its strategy."

According to senior members in the ruling and opposition camps,
Ozawa indicated in his meeting with Prime Minister Aso that the
party would boycott all deliberations. Although the Upper House
cancelled all committee meetings yesterday, the Lower House carried
out deliberations. Complaining that the Lower House will not take
the blame, the Upper House has decided to resume deliberations

6) LDP Diet Affairs Committee chairman: Second extra budget bill
should be submitted to ordinary Diet session

SANKEI (Page 5) (Full)
November 19, 2008

In meeting with Executive Council Chairman Takashi Sasagawa and
others in the Diet Building yesterday, Liberal Democratic Party's
Diet Affairs Committee Chairman Tadamori Oshima indicated that the
government should convene an ordinary Diet session in early January
and submit to the session a second supplementary budget bill for
fiscal 2008 to finance the government's additional economic
measures: "It would be better to open the next ordinary Diet session
early and submit the extra budget bill (with budget-related bills)
in a package." A senior member of the New Komeito Diet Affairs
Committee also expressed a similar view the same day.

7) Prime minister plans to strengthen diplomacy and sense of
security in compiling fiscal 2009 budget

SANKEI (Page 5) (Abridged slightly)
November 19, 2008

Prime Minister Taro Aso, calling Finance Minister and Financial
Services Minister Shoichi Nakagawa, Economic and Fiscal Policy
Minister Kaoru Yosano, and Internal Affairs and Communications
Minister Kunio Hatoyama to his office last evening, informed them of
his policy approaches to the compilation of the fiscal 2009 state
budget and the organization of civil servants and their management.

TOKYO 00003180 005 OF 008

Regarding the management of civil servants, the prime minister
ordered them to increase personnel for agencies connected with the
public's sense of reassurance, such as the planned Consumer Affairs
Agency, as well as public safety and quarantine. He focused on the
diplomatic area, including embassies, as well.

After the meeting, Internal Affairs and Communications Minister
Hatoyama revealed to reporters a plan to consider increasing the
official development assistance (ODA) budget, saying: "The ODA
budget has been reduced too much."

In compiling the state budget, the prime minister pointed out the
following as top priorities: (1) implementation of additional
economic stimulus measures centering on local areas; (2) promotion
of the strategic international cooperation initiative with financial
crisis measures in mind; and 3) spending cuts and the promotion of
bold reform. The prime minister also indicated that he would issue
an additional order independently regarding the allocation of the
330 billion-yen framework for promoting priority items.

8) Aso gives up on meeting with Obama after APEC summit

NIKKEI (Page 2) (Full)
November 19, 2008

The government planned to arrange a meeting between Prime Minister
Taro Aso and President-elect Barack Obama after the Asia-Pacific
Economic Cooperation (APEC) summit scheduled for Nov. 22-23 in Lima,
Peru, but it decided yesterday to give up on the plan. The prime
minister will make a stopover in the U.S. for the government plane
to be refueled on his way back to Japan. The government hoped to
arrange a meeting on that occasion. But a government source said:
"There will not be a meeting because we have received no
communication from the other side." The government will continue to
seek an opportunity for an early meeting.

9) Japan's bid to host next round of financial summit threatened
with surfacing of Britain, next G-20 chair, as strong rival

TOKYO SHIMBUN (Page 2) (Full)
November 19, 2008

Prime Minister Aso is eager to host the second G-20 emergency
financial summit. However, Japan's bid is now under a dark cloud,
because Britain has surfaced as a strong rival.

The prime minister while in Washington, where the first round of the
financial summit was held, made a remark, "Japan is appropriate as a
venue for the next financial summit." His thinking was that Japan,
as the chair of the G-8 this year, could display leadership as a
mediator between industrialized and emerging countries -- the reason
being so that he could use the achievement to buoy up his
administration's sagging popularity. He had thought that since Japan
gave in to the U.S. regarding the venue for the first meeting, it
would be easy for Japan to obtain understanding from various
countries about its hosting the second G-20 summit.

However, after the end of the first round, French President Sarkozy
said, "Britain is a strong candidate for hosting the next meeting."
The remark has cast a pall over Japan's bid. Twenty countries (G-20)
-- G-8 plus emerging countries -- took part in the financial summit.
Britain will chair the G-20 next year. Sarkozy's proposal is based

TOKYO 00003180 006 OF 008

on the thought that since the next financial summit will be held
before April 30, Britain is the appropriate place to hold it.

Finance Minister Shoichi Nakagawa rebutted Sarkozy's remark, saying,
"Nothing has been set yet." However, a growing view in the
government is that the situation is disadvantageous to Japan.

The prime minister made a Diet reply at a plenary session of the
Lower House on November 18, "I would like to promote cooperation
with related countries, including where and when to hold the next
round of the summit." This gave the impression that he has stepped
back from his position.

10) High-level Japan-China economic talks this year to be postponed

NIKKEI (Page 2) (Full)
November 19, 2008

Major economic ministers from the governments of Japan and China
planned to hold talks in December, but both sides have decided to
give up on talks this year, according to government sources
yesterday. The high-level talks, originally scheduled for late
November, were rearranged to take place in early December. The
Chinese government made the request for the postponement, citing the
cabinet ministers' schedules as the main reason. But its desire to
give priority to implementing economic stimulus measures worth 4
trillion won (approximately 57 trillion yen) also seems to be behind
the request.

The two governments hope to bring about the high-level talks at an
early date, so they will start coordination, eyeing early next

11) Yoke of 9/11

MAINICHI (Page 5) (Abridged slightly)
November 19, 2008

Takeshi Yamashina

At the U.S. Embassy on the morning of Nov. 5, the U.S. presidential
election day, I had an opportunity to talk to Victoria Becker (TN:
phonetic), who works at a multinational corporation in Tokyo.
"America's image has been damaged by the Iraq war," she said. She
also indicated that during her travel to France and Italy after the
opening of the Iraq war, some local people showed hatred toward her
when they learned she was American. One even pointed at her with his
fingers like a pistol. Ms. Becker added: "I became depressed because
I like those countries. We should select a president who can lead
the United States in a new, positive direction. Senator Obama is the
appropriate choice."

In the wake of the 9/11 terrorist attacks, the Bush administration
focused its attention on waging a "war on terror" that led to wars
in Afghanistan and Iraq. That policy course has ended up with
Washington neglecting other issues in the foreign policy and
economic areas.

Japan, too, has taken part in the war on terror in the form of
sending Ground Self-Defense Force troops to Iraq and refueling
foreign naval vessels in the Indian Ocean. At one point, the issue
of resuming U.S. beef imports in the wake of the outbreak of BSE

TOKYO 00003180 007 OF 008

could have resulted in friction between Japan and the United States.
But Washington did not exhibit a hard-line stance.

Former diplomat and Ritsumeikan University visiting professor
Kunihiko Miyake noted: "Over the last eight years, America has paid
little attention to Japan and Asia, and some ugly aspects of the
Japan-U.S. relationship have been left to fester. The question is if
that was really good. Policy toward Japan will change in the future,
and diplomatic pressure will grow." Promising change,
President-elect Barack Obama has released the United States from the
yoke of 9/11. Change can be expected to occur in U.S. policy toward
Japan, as well.

12) More deficit-covering government bonds to be issued due to 6
trillion yen drop in estimated tax revenues

MAINICHI (Page 1) (Full)
November 19, 2008

Mainichi Shimbun learned on November 18 that general-account tax
revenues for fiscal 2008 will drop more than 6 trillion yen from the
originally estimated amount of 53.5 trillion yen. The major reason
of the shortfall is a significant decline in corporate tax revenues,
a main contributor to tax revenues, in the wake of a substantial
slip in corporate performances resulting from the economic slump at
home and abroad. The Finance Ministry intends to make up for the
shortfall in tax revenues by increasing the issuance of
deficit-covering government bonds. The decision will be incorporated
into the fiscal 2008 supplementary budget bill now being drafted.

This would be the first time in about six years -- fiscal 2002 --
when the country suffered serious deflation, for the government to
issue deficit bonds in the middle of the fiscal year. There is
concern, though, that state finances will worsen, when expenditures
are increased for such reasons as the adoption of the flat-sum cash
benefit program totaling 2 trillion yen, following the government's
additional economic stimulus package.

Chances are that the value of newly issued government bonds,
including construction bonds, in fiscal 2008 will reach the 30
trillion yen level for the first time in three years, largely
exceeding the projection made at the stage of the initial budget
(25.3 trillion yen). It now appears difficult for the government to
achieve the goal of moving the primary balance into the black by
fiscal 2011.

Based on the economic conditions as of the end of last year, the
Finance Ministry had estimated tax revenues for fiscal 2008 at
53.554 trillion yen at the stage of compiling the initial budget.
However, the financial crisis originating in the U.S. has become
serious since early this year. As a result, the actual tax revenues
for fiscal 2007, which serve as a premise for a projection for
fiscal 2008 tax revenues, fell below the government's estimate by
approximately 1.5 trillion yen. Since corporate performances are
further deteriorating in fiscal 2008, the Finance Ministry will
likely revise down the estimate for tax revenues to around 47
trillion yen, down over 6 trillion yen from the projection made when
the initial budget was compiled.

Following an estimate for a substantial fall in tax revenues, the
Finance Ministry will revise down a projection for tax revenues,
coinciding with the compilation of the second supplementary budget.

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A drop in tax revenues appears unavoidable in the future as well
because of the possibility of the domestic economy growing at a
negative rate in fiscal 2008 and 2009.


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