Cablegate: Daily Summary of Japanese Press 01/05/10

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PP RUEHFK RUEHKSO RUEHNAG RUEHNH
DE RUEHKO #0021/01 0060305
ZNR UUUUU ZZH
P 060305Z JAN 10
FM AMEMBASSY TOKYO
TO RUEHC/SECSTATE WASHDC PRIORITY 8537
INFO RUEKJCS/SECDEF WASHDC PRIORITY
RHEHAAA/WHITE HOUSE WASHINGTON DC PRIORITY
RUEAWJA/USDOJ WASHDC PRIORITY
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RHHMUNA/HQ USPACOM HONOLULU HI
RHHMHBA/COMPACFLT PEARL HARBOR HI
RHMFIUU/HQ PACAF HICKAM AFB HI//CC/PA//
RHMFIUU/USFJ //J5/JO21//
RUYNAAC/COMNAVFORJAPAN YOKOSUKA JA
RUAYJAA/CTF 72
RUEHNH/AMCONSUL NAHA 0517
RUEHFK/AMCONSUL FUKUOKA 8173
RUEHOK/AMCONSUL OSAKA KOBE 1986
RUEHNAG/AMCONSUL NAGOYA 5281
RUEHKSO/AMCONSUL SAPPORO 8672
RUEHBJ/AMEMBASSY BEIJING 2517
RUEHUL/AMEMBASSY SEOUL 9182
RUCNDT/USMISSION USUN NEW YORK 8607

UNCLAS SECTION 01 OF 07 TOKYO 000021

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 01/05/10

INDEX:
(1) DM Kitazawa announces creation of special Futenma relocation
team (Sankei)

(2) People's New Party to submit two proposals on Futenma's
relocation site (Yomiuri)

(3) Ginowan City's long-cherished dream of Futenma's relocation to
Guam (Okinawa Times)

(4) Japan-U.S. free trade agreement (Yomiuri)

(5) April-May to become crucial stage for Hatoyama administration's
diplomacy; Gap between views of U.S. and ruling coalition on
deadline for Futenma conclusion (Nikkei)

(6) Hatoyama seen as a prime minister who has not experienced
hardships (Nikkei)

ARTICLES:

(1) DM Kitazawa announces creation of special Futenma relocation
team

SANKEI ONLINE (Full)
13:30, January 5, 2010

At a news conference on the morning of Jan. 5, Defense Minister
Toshimi Kitazawa announced the creation of a special team on the
issue of the relocation of the U.S. forces' Futenma Air Station (in
Ginowan City, Okinawa) reporting directly to the top political
appointees in the Ministry of Defense (MOD). The team will be
launched within this month.

This is because of the need to engage in smooth coordination with
Okinawa and the U.S. Department of Defense, as the Democratic Party
of Japan, the Social Democratic Party, and the People's New Party
are expected to submit this month their proposals for Futenma's
relocation site to the committee of the government and the ruling
parties for examining base issues in Okinawa. The special team will
consist of five to six MOD bureaucrats not only from the Defense
Policy Bureau, which has so far taken charge of issues relating to
U.S. Forces Japan realignment, but also from the Bureau of Local
Cooperation and other offices.

(2) People's New Party to submit two proposals on Futenma's
relocation site

YOMIURI (Page 2) (Full)
Evening, January 5, 2010

In connection with the relocation of the U.S. forces' Futenma Air
Station in Okinawa, People's New Party (PNP) policy chief Mikio
Shimoji indicated at a meeting with his support group in Naha on the
morning of Jan. 5 that the PNP will submit two proposals to the
committee of the government and the ruling parties for the
examination of Okinawa's base issues, namely: (1) integration of the
Futenma base with Kadena Air Base (straddling the towns of Kadena
and Chatan and Okinawa City) and dispersing the training exercises
to Kansai Airport, the Ie Island auxiliary airfield (in Ie Village,
Okinawa), and other locations; and (2) relocation out of Okinawa.

TOKYO 00000021 002 OF 007

The ruling parties have decided to submit their proposals for
relocation sites to the committee by the end of January. Shimoji
mentioned relocation to the Shimoji Island airport (in Miyakojima
City, Okinawa) in late 2009 but withdrew this proposal in the belief
that "this will not be acceptable to the U.S," according to a senior
PNP official. At the Jan. 5 meeting, Shimoji said that "the PNP will
not pick Shimoji Island."

(3) Ginowan City's long-cherished dream of Futenma's relocation to
Guam

OKINAWA TIMES (Page 1) (Full)
January 5, 2010

Kenya Fukusato, Reporting Team on 50 Years of the Security Treaty

The official residence of the U.S. consul general in Okinawa is
located on a hill, overlooking the runway of the Futenma Air
Station, which a senior U.S. official once termed "the most
dangerous military base in the world," illuminated by red and green
lights in the complete darkness.

On Nov. 30, U.S. Ambassador to Japan John Roos hosted a dinner for
the leaders of the municipalities hosting U.S. bases.

Holding a wine glass in one hand, Ambassador Roos listened almost
silently to Ginowan City Mayor Yoichi Iha, who said: "This is an
illegal military base even under U.S. domestic laws."

The return of the Futenma base has been left hanging for 13 years on
account of the "bottleneck" of relocating this facility within
Okinawa. Iha advocated the relocation of the U.S. Marines to Guam
and argued that a replacement facility should not be built in the
coastal area of Camp Schwab.

After dinner, the group moved to the living room to sit on the sofa.
Just as Ambassador Roos was going to say something, the conversation
was interrupted by the noise of a helicopter. He smiled wryly and
said: "The current relocation plan is a feasible option."

Iha was elected to his first term in 2003 with a pledge to "disperse
and relocate Futenma's functions." He opposes the passing around of
bases within Okinawa, and his long-cherished dream is the withdrawal
of U.S. Marines from Okinawa through Futenma's relocation.

Iha came to have great confidence in his longstanding proposal for
Futenma's relocation out of Japan in light of the U.S. forces'
policy after the realignment of U.S. Forces Japan.

The 2006 Guam Integrated Military Development Plan includes the
construction of aprons to accommodate 67 Marine helicopters. The
capacity of the new facility will be comparable to Futenma.

Iha visited Guam in 2007. The deputy commander of the Air Force base
explained that "the plan is to construct a facility to accommodate
65-70 Marine aircraft."

The draft proposal for environmental impact assessment relating to
Guam relocation published in November 2009 states that in addition
to the Marine command headquarters, the helicopter units will also
be relocated from Okinawa.

TOKYO 00000021 003 OF 007

In late 2009, Prime Minister Yukio Hatoyama announced his intention
to reconsider relocation sites for the Futenma base, including
locations outside of Okinawa or Japan.

Iha even felt relieved that "(the current relocation plan) has
effectively been negated."

On the other hand, the focus of this issue tends to be on the
relocation site, and nothing has been done about the danger posed by
the Futenma base, which directly affects citizens' lives. Iha is
hopeful that the new administration will "attach greater importance
to the danger than the previous administration." However, the
government's policy is not to rule out the current relocation plan
as an option, and it remains unclear how it intends to remove the
danger until a relocation site is identified and the base is
returned.

(4) Japan-U.S. free trade agreement

YOMIURI (Page 13) (Excerpts)
January 5, 2010

By Noboru Hatakeyama

The Democratic Party of Japan (DPJ) in its policy manifesto for the
Lower House election pledged to promote talks on a free trade
agreement (FTA) with the U.S. There is a story behind this policy of
the DPJ: The party had at first intended to aim at concluding the
pact. However, it later reportedly backpedalled on the wording due
to opposition from agricultural organizations. However, the DPJ had
kept its pledge to promote FTA talks with the U.S. in place, even
though it has backpedalled on its wording. This means that the DPJ
has made up its mind firmly, which deserves high marks.

However, it is strange that when President Obama visited Japan in
November last year, the Japanese side did not make any proposal on a
Japan-U.S. FTA. The government presumably thought that it would be
safer not to bring up this issue, as agricultural organizations are
strongly opposed to the idea. Then, what will become of the DPJ's
policy slogan to implement the manifesto to the maximum extent
possible?

The greatest obstacle to a Japan-U.S. FTA is negotiations on
agricultural products. Even so, it is not possible to draft an FTA
that only excludes agricultural and livestock products because that
would be in breach of the World Trade Organization's FTA
regulations. FTAs on trade in goods, such as agricultural products
and automobiles, must basically target all trade items between the
two countries.

To be specific, the regulations are interpreted as indicating that
more than 90 percent of the value of imports should be subject to
the accord. Conversely, it is possible to interpret that up to 10
percent of imports from the FTA partner can be exempted from an FTA.
However, since food items Japan imports from the U.S. already exceed
20 percent, it would be very difficult to include items exempted
from the accord within 10 percent.

A sound argument would be for Japan to boost its international
competitiveness by seriously addressing agricultural reform and
forging an FTA with the U.S. that covers agricultural and livestock
products as well. The DPJ's manifesto states that it will implement

TOKYO 00000021 004 OF 007

a system of compensating farmers who sell their products based on
the balance between the sales prices of agricultural and livestock
products and the cost of producing them. The WTO under certain
circumstances allows the direct compensation of famers with the aim
of making up for a decrease in their incomes as a result of a drop
in domestic sales prices due to a reduction in trade tariffs on
agricultural and livestock products. It would be logical for the
government to squarely address agricultural reform using this system
and then move on to entering into an FTA with the U.S.

However, this will take a considerable amount of time. The writer,
therefore, would like to propose that Japan and the U.S. sign an FTA
for trade in services for the time being. As readers know, there are
two kinds of trade - trade in goods and trade in services.
Representative examples of trade in goods include agricultural
products and automobiles. Examples of trade in services include
distribution and financial services. The WTO has separate
regulations for trade in goods and trade in services. Therefore, it
would be possible to sign an FTA for trade in services alone in
terms of concluding a pact, although there are no precedents.

First, if this proposal is materialized, Japan would not have to
lower its tariffs on agricultural products. The U.S. would not have
to expose its manufacturing industry, which is in a fix, to even
fiercer competition. Second, the U.S.'s distribution and financial
services sectors could enjoy a more liberalized Japanese market.
Japan's services industry would become stronger through competition
against the U.S. Third, if Japan and the U.S. sign an FTA, ties
between the two countries would become stronger, even if the accord
covers trade in services alone.

This year marks the 50th anniversary of the revision of the
Japan-U.S. Security Treaty. Japan-U.S. relations are being buffeted
over the issue of relocating the Marine Corps' Futenma airfield. In
this memorable year, both nations should not only settle their
pending issues expeditiously, but also launch FTA talks for trade in
services and use it as a basis for strengthening bilateral ties.

Noboru Hatakeyama: Chairman of the Japan Economic Foundation. Former
vice minister of international trade and industry (now the Ministry
of Economy, Trade and Industry). Former executive director of the
Japan External Trade Organization.

(5) April-May to become crucial stage for Hatoyama administration's
diplomacy; Gap between views of U.S. and ruling coalition on
deadline for Futenma conclusion

NIKKEI (Page 2) (Full)
January 5, 2010

The Hatoyama administration's diplomacy will reach a crucial stage
in April and May, when the government aims to reach a conclusion the
issue of relocating the U.S. Marine Corps' Futenma Air Station in
Okinawa Prefecture. Although Prime Minister Yukio Hatoyama expects
to inform U.S. President Barack Obama of his decision on the Futenma
relocation issue after looking into a new replacement site, there is
still a wide gap between the views of the people of Okinawa and the
Social Democratic Party (SDP), and Washington. If a rift emerges in
the Japan-U.S. relationship, it could affect pending diplomatic
issues such as the North Korean problem.

Late last year the government and ruling parties began looking into

TOKYO 00000021 005 OF 007

relocation sites other than the coastal area of Camp Schwab, which
is the site for the existing plan. Hatoyama's intention to resolve
the issue in May implies that he is giving consideration to the
Japan-U.S. agreement as well. "The Prime Minister aims to visit
Washington bringing an agreement of the ruling parties before or
after the consecutive holidays (in early May) and settle the issue
at a meeting with the President" said a senior Foreign Ministry
official.

In the ruling coalition, the SDP has strongly called for moving the
Futenma base out of Okinawa or out of Japan. Since it has sought to
constrain the DPJ by brandishing the threat of leaving the coalition
if the Futenma base is relocated within Okinawa, the government has
been put in an extremely difficult situation as it tries to reach an
agreement with Washington, which insists that the existing plan is
the best and only viable option.

This year marks the 50th anniversary of the revision of the
U.S.-Japan Security Treaty. Foreign Minister Katsuya Okada is
determined to make the Japan-U.S. alliance deeper and more
sustainable, but some officials in the U.S. government are
distrustful of the Hatoyama administration's security policy. As a
result, Okada may be unable to start discussions with Washington
before the Futenma issue is resolved.

The United States will hold the first security summit in Washington
on April 12 and 13. The leaders of nuclear powers and other
countries will attend the security summit to discuss setting up a
system to protect nuclear materials from entering the hands of
terrorists and other organizations. Japan also plans to embark on
new efforts toward creating a world without nuclear weapons.

In late June, the Group of Eight (G-8) summit will be held in
Canada. Japan will be sending a different prime minister to the G-8
summit for the fourth time in a row since the G-8 summit in 2007, in
which then Prime Minister Shinzo Abe participated. There will also
be two G-20 summits in June and November, which will serve as an
initial test for DPJ diplomacy.

The major international conferences to be held in Japan are the 10th
session of the Conference of the Parties of the UN Framework
Convention on Climate Change (COP10) and the Asia-Pacific Economic
Cooperation (APEC) conference. The leaders of the APEC members will
assemble in Yokohama on Nov. 13 and 14.

Major diplomatic schedules for 2010

Jan. 2-5 Foreign Minister Okada visits Turkey
Jan. 16-17 Asia-Latin America Cooperation Forum's foreign
ministerial meeting
Jan. 24 Nago mayoral election (Okinawa)
Jan. 27-31 Davos Conference
Jan. 28 International conference on Afghanistan (London)
February (?) Foreign Ministry's expert committee issues a final
report on the secret nuclear agreement
April 12-13 Nuclear security summit (Washington)
May 3-28 NPT review conference (New York)
(?) Government, ruling parties make a decision on the Futenma
relocation issue
Consecutive holidays Prime Minister Yukio Hatoyama visits
Washington?
June 25-27 G-8 summit (Muskoka, Canada)

TOKYO 00000021 006 OF 007

June 26-27 G-20 summit (Toronto, Canada)
July Upper House election
Oct. 4-5 ASEM summit (Brussels)
Oct. 18-29 COP 10 (Nagoya, Japan)
November G-20 summit (South Korea)
Nov. 13-14 APEC summit (Yokohama, Japan)

(6) Hatoyama seen as a prime minister who has not experienced
hardships

NIKKEI (Page 2) (Slightly abridged)
January 1, 2010

Prime Minister Yukio Hatoyama, who boasts of achieving a change of
administration and the "first revolution since the Meiji
Restoration," will be facing a new phase in the management of the
administration in the New Year. We will take a look at the present
state of the Hatoyama administration, which won overwhelming support
from the voters by giving full publicity to its manifesto (campaign
pledges), which it calls its "promise to the people."

In late 2009, Hatoyama murmured to his aides, "I would like to
appear on TV with Miyuki." His wife Miyuki was invited to appear on
a popular variety show for the New Year and he wanted to appear with
her as a couple.

Premiership backed by popular will

Hatoyama's aides frowned. If he appeared on that program, it would
have been just a week or so after he offered his explanation on the
falsified reports of his political funds. They told him gently: "We
are sorry, but this is not the right timing." Hatoyama accepted the
advice but this was an instance in which the difference between his
perception and that of his aides was apparent.

When he was in the opposition camp, Hatoyama criticized the prime
ministers of the Liberal Democratic Party (LDP) administration for
"not obtaining a mandate through an election but (assuming the
premiership) through a rotation of power." As a matter of fact, the
Democratic Party of Japan (DPJ), under his leadership, won popular
support and captured 300 seats in the House of Representatives
election last summer. He ascended to the position of prime minister
with great confidence and everything appeared to be going well.

Hatoyama once cited "strong leadership and a sincere sense of
responsibility" as the requirements for an "ideal prime minister." A
hundred days after he assumed office, the support rating for his
cabinet dropped by 25 percentage points in the Nihon Keizai
Shimbun's latest opinion poll, the main reason being his "lack of
leadership." Over 70 percent of the respondents thought his
explanation on the falsified political donations was
"unsatisfactory."

Before the administration was launched, then DPJ Secretary General
Katsuya Okada suggested to Hatoyama that "the abolition of the
provisional tax rate for gasoline and other products can come in the
second year of the administration," but Hatoyama insisted, saying:
"This is considered a fait accompli by the people." He ordered the
inclusion of this item in the party's manifesto.

When the time came for the formulation of the budget under his
administration and he faced a dilemma between realizing the election

TOKYO 00000021 007 OF 007

pledges and securing the revenue to fund these policies, he made a
sudden about-face, accepted the party's demand, and decided to
maintain the gasoline tax rate. Regardless of the merit of this
decision, it left a strong impression of Hatoyama relying on the
leadership of Secretary General Ichiro Ozawa both domestically and
internationally. It remains unclear what he wants to accomplish as a
prime minister and what his policy vision is.

Habit of telling others to "discuss" things

Hatoyama reportedly has the habit of saying to others: "I want all
of you to discuss this thoroughly." While there is a structural
problem in the cabinet in which no one has taken on the role of
coordinator for Hatoyama, there is no denying that his attitude,
which can be interpreted as "do what you think is best," has been a
source of disarray in the cabinet. Hatoyama is neither the
authoritative type of prime minister like Junchiro Koizumi nor the
coordinator type like Keizo Obuchi. Many people think he was
probably unprepared to become the prime minister.

In the Lower House election of 2000, DPJ President Hatoyama kicked
off the election campaign on the day of the official filing of
candidacy in Shimane, the home constituency of former Prime Minister
Noboru Takeshita. He paid no attention to his past relations with
Takeshita, who "campaigned for Hatoyama everywhere in Hokkaido when
he was running for a Diet seat for the first time." (according to a
former secretary of a Takeshita faction Diet member) Such is one
aspect of Hatoyama, which is considered "valiant" by some, but
"ruthless" by others.

Hatoyama has no enemies in his party. The "Hatoyama brand" also
serves him well in the political world. On the other hand, this also
contains elements of "imprudence" and "insensitivity," which may
become fatal at times. His qualifications as a prime minister are
now being called into question over the falsified political
donations, for which his former secretary has been indicted for
violating the Political Fund Control Law.

Donation issue deals heavy blow

It is said that a prime minister must possess the sense of balance
needed to allocate a national budget of nearly 100 trillion yen
along with the common folk's sensibility of worrying about the
prices of vegetables. This is one reason why Hatoyama's
"personality" still enjoys the support of 50 percent of the people.
However, his failure to declare funds amounting to 1.2 billion yen
provided by his mother and pay gift tax for this has disappointed
his supporters. Who could have predicted that Chief Cabinet
Secretary Hirofumi Hirano would one day have to dismiss talk of
Hatoyama's resignation at a news conference by saying: "I do not
think (the prime minister will resign)"?

A politician who left the LDP together with Hatoyama in 1993 and who
was one of the key founders of New Party Sakigake offers the
following analysis of Hatoyama's character: "He does not have the
experience of making a major mistake or having to endure tremendous
hardships, so he seems sort of carefree and behaves artlessly in
certain ways."

ROOS

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