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UNCLAS SECTION 01 OF 07 TOKYO 005474 
 
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 12/06/07 
 
 
Index: 
 
(1) U.S. Deputy Chief of Mission expresses hope for early resumption 
of refueling operation (Sankei Net) 
 
(2) Government, ruling coalition to arm themselves with theoretical 
backing in order to take re-vote on new antiterrorism legislation, 
noting that a censure motion has no "legal binding force" (Yomiuri) 
 
(3) Fukuda beginning to demonstrate his imprint in foreign and 
security policies; Foreign policy study panel's inaugural meeting 
set for Dec. 9 (Yomiuri) 
 
(4) Debate over "buried money" to fund fiscal reconstruction heating 
up in LDP; Nakagawa suggests using reserve funds in special accounts 
(Nikkei) 
 
(5) DPJ Tax System Research Commission starts discussion: 
Reallocation of national auto tax revenues; Child allowance in place 
of dependent exemption (Mainichi) 
 
(6) Editorial: Urgency of Defense Ministry reform to prevent the 
ministry from producing another "Moriya" (Mainichi) 
 
 ARTICLES: 
 
(1) U.S. Deputy Chief of Mission expresses hope for early resumption 
of refueling operation 
 
SANKEI NET (Full) 
1:30, December 6, 2007 
 
United States Deputy Chief of Mission to Japan Joseph R. Donovan 
gave an interview to the Sankei Shimbun in Osaka yesterday. 
Referring to the new antiterrorism special measures bill, now under 
discussion in the House of Councillors, Donovan expressed hope for 
an early enactment of the legislation, saying: "We hope that Japan 
will find a way to resume the refueling mission in the near future." 
He also emphasized the significance of Japan's activities in the 
international community by touching on the fact that when the 
Maritime Self-Defense Force's supply ship returned home following 
the expiration of the Antiterrorism Special Measures Law, it was 
received by the ambassadors of various countries, including Pakistan 
and Afghanistan. 
 
Referring to the planned six-party heads-of-delegation meeting on 
the North Korean nuclear issue, Donovan noted: "North Korea should 
declare that it will end all its nuclear-related activities and 
nuclear development programs by the end of the year." He added that 
(the United States) will not delist North Korea as a state sponsor 
of terrorism "unless there is progress in the six-party talks and an 
agreement is reached in the process of the talks." 
 
Touching on the relationship between Japan and North Korea, he 
stated: "We will urge North Korea to improve its relationship with 
Japan. Our position is that the abduction issue in particular is 
included." He indicated that the U.S. stance of placing priority on 
the abduction issue will not change. Moreover, on the possibility of 
Assistant Secretary of State Christopher Hill, chief U.S. delegate 
to the six-party talks, visiting Japan before year's end, Donovan 
indicated that the United States will work in close cooperation with 
Japan. 
 
TOKYO 00005474  002 OF 007 
 
 
 
U.S. Deputy Chief of Mission Joseph R. Donovan speaks to Sankei 
Shimbun on Dec. 5 at the U.S. Consulate General in Kita Ward, 
Osaka. 
 
(2) Government, ruling coalition to arm themselves with theoretical 
backing in order to take re-vote on new antiterrorism legislation, 
noting that a censure motion has no "legal binding force" 
 
YOMIURI (Page 4) (Full) 
December 4, 2007 
 
The government and the ruling coalition are beginning to prepare 
themselves for a theoretical argument in order to again put to the 
vote the new antiterrorism special measures bill in the Lower House 
in the event that the bill is rejected by the Upper House or in the 
event that the bill is deemed "rejected" by the Upper House. The 
government and the ruling coalition are taking the position that 
since the Constitution allows a re-vote, even though the opposition 
bloc plans to submit a censure motion against the prime minister, 
that motion has no legal binding force. Meanwhile, the major 
opposition Democratic Party of Japan (DPJ), which has become the 
first party in the Upper House as a result of this summer's Upper 
House election in July, is opposing the move by the government and 
the ruling bloc to take a re-vote, arguing that the will of the 
people shown in the Upper House election will be denied. 
 
Ruling bloc wants to avoid dissolution of Lower House 
 
Meeting the press on Dec. 3, the ruling Liberal Democratic Party's 
(LDP) Secretary General Ibuki emphasized his intention to devote 
himself to passing the new antiterrorism legislation. When asked 
about taking a re-vote on that bill, Ibuki said: "We have yet to 
study that option." 
 
Contrary to his remark, however, the LDP has already finalized an 
internal report on a re-vote and the validity of a censure motion. 
The report notes: (1) The Lower House's choice overrides the Upper 
House's choice, for instance, in the Diet's nomination of a prime 
minister, and the functions of the Upper House are limited to 
"supplementing the Lower House and laying restraint on the Lower 
House's activities" and (2) even though the Upper House may adopt a 
censure motion against the prime minister, the motion has no legal 
binding force. 
 
These points in the report are in line with a set of proposals 
released in November by the National Council for Building a New 
Japan, a forum consisting of Kikkoman Corp. Chairman Yuzaburo Mogi, 
Gakushuin University Prof. Takeshi Sasaki, and others. 
 
The council's proposals conclude that a censure motion submitted by 
the Upper House has no validity, citing such constitutional 
provisions as Article 63, which says the prime minister and cabinet 
members can attend the Diet session at anytime, Article 67, which 
says the Diet's lower chamber's choice overrides the upper chamber's 
choice in the Diet's nomination of a prime minister, and Article 69, 
which says it is the lower chamber that can pass a no-confidence 
motion against the prime minister. 
 
Prime Minister Fukuda, as well, told reporters in Singapore on Nov. 
21: "I wonder whether there is someone who can censure me." Fukuda 
cast doubts on the move by the opposition bloc to submit a censure 
 
TOKYO 00005474  003 OF 007 
 
 
motion on the grounds of the ruling bloc taking a re-vote. 
 
When it comes to the Lower House approving bills rejected by the 
Upper House, there has been only one such case, namely, a bill 
allowing motor boat races was re-adopted in June 1951. When it comes 
to cases of the Lower House approving a bill that were rejected by 
the Upper House, there also has been only one, namely, a special 
measures bill for the transfer of assets under a special account for 
national hospitals. 
 
The ruling parties are concerned that taking a re-vote may be viewed 
by the public as a high-handed approach. So, from now on they intend 
to assert that while it is unusual to take a re-vote, doing so is 
justifiable. 
 
The ruling parties' move to arm with theoretical backing regarding a 
re-vote reflects their ulterior motive to avoid the case of 
dissolving the Lower House for a snap general election. 
 
There is the indication that if a re-vote is taken, the DPJ would 
adopt a censure motion against the prime minister (in the Upper 
House), thereby throwing the Diet into confusion and driving the 
ruling bloc into dissolving the Lower House. In order to avoid this 
possibility, the ruling parties intend to emphasize that a censure 
motion has no legal binding force. 
 
DPJ highlights the people's will 
 
Meanwhile, the DPJ's Diet Affairs Committee Chairman Kenji Yamaoka 
said that the case of the Lower House overriding a bill rejected by 
the Upper House "would mean the Lower House has rejected the 
people's will." 
 
On Nov. 3, Yamaoka met separately with Deputy President Kan, 
Secretary General Hatoyama, and DPJ Upper House Caucus Chairman 
 
SIPDIS 
Azuma Koshiishi and discussed how to deal with the new antiterrorism 
legislation. As a result, they agreed that the party would put 
together a set of problems about a re-vote and use them to form the 
party's unified view. 
 
The DPJ's Upper House Diet Affairs Committee Chairman Susumu Yanase, 
too, insisted on his website that day: "If the LDP and the New 
Komeito re-adopt a bill that has split public opinion into two, then 
the Lower House should be dissolved immediately. This matter has 
nothing to do with the question of whether a censure motion 
submitted to the Upper House is adopted." 
 
(3) Fukuda beginning to demonstrate his imprint in foreign and 
security policies; Foreign policy study panel's inaugural meeting 
set for Dec. 9 
 
YOMIURI (Page 4) (Abridged slightly) 
December 6, 2007 
 
Chief Cabinet Secretary Nobutaka Machimura announced in a press 
conference yesterday that the Foreign Policy Study Council (Gaikou 
seisaku benkyoukai), chaired by National Defense Academy President 
Makoto Iokibe, an advisory panel to Prime Minister Yasuo Fukuda, 
will hold its inaugural meeting at a Tokyo hotel on Dec. 9. Two 
months into office, Prime Minister Fukuda is now trying to establish 
a diplomatic system led by Kantei (Prime Minister's Official 
Residence) with an eye on the planned visit to China and the G8 
 
TOKYO 00005474  004 OF 007 
 
 
Summit, which Japan will host next July in the Lake Toya hot-spring 
resort area in Hokkaido. 
 
The council comprising eleven individuals specializing in such 
fields as diplomacy, security, and global economy will frankly 
exchange views with the prime minister on foreign policy while 
dining. Chief Cabinet Secretary Machimura and Assistant Deputy Chief 
Cabinet Secretary Hiroyasu Ando will also join as necessary. 
 
Machimura told the press conference: "Having a variety of 
information will help the prime minister perform summit diplomacy 
that is broad and deep." 
 
The council is modeled after the task force on external affairs, 
which Fukuda ran as chief cabinet secretary under the former Koizumi 
administration. The council includes many task force members, such 
as Yukio Okamoto who chaired it. 
 
Important diplomatic events are lined up for the prime minister, 
such as a visit to China, the Tokyo International Conference on 
African Development (TICAD) to be held in Yokohama next May, and the 
G8 Summit. Fukuda seemingly wants to boost his presence in the 
international community. "The question is how much Prime Minister 
Fukuda can demonstrate his policy imprint by the G8 Summit," a 
person close to Fukuda said. 
 
Fukuda has been busy dealing with Diet affairs these days. Although 
his administration is still being challenged to quickly pass the new 
antiterrorism legislation, Fukuda's apparent determination to expand 
his knowledge of diplomacy and security, his forte, seems to reflect 
his calm calculation in running his administration. 
 
He has also embarked on a Kantei-led effort to reform the 
scandal-prone Ministry of Defense (MOD) by establishing a MOF reform 
council composed of experts and Machimura. 
 
Foreign Policy Study Council members: Makoto Iokibe (chair), 
president of National Defense Academy; Yukio Okamoto, former adviser 
to the prime minister; Masao Okonogi, professor at Keio University; 
Shinichi Kitaoka, professor at the University of Tokyo; Yorihiko 
Kojima, vice-chairman of the Japan Association of Corporate 
Executives; Kyosuke Shinozawa, former president of the Japan Bank 
for International Cooperation; Takashi Shiraishi, vice president of 
National Graduate Institute for Policy Studies; Akihiko Tanaka, 
professor at the University of Tokyo; Sakutaro Tanino, former 
ambassador to China; Hiroshi Nakanishi, professor at Kyoto 
University; and Osamu Watanabe, former chairman of the Japan 
External Trade Organization. 
 
(4) Debate over "buried money" to fund fiscal reconstruction heating 
up in LDP; Nakagawa suggests using reserve funds in special 
accounts 
 
NIKKEI (Page 2) (Full) 
December 6, 2007 
 
Debate on whether surplus money to finance fiscal reconstruction 
measures exists in the government is heating up in the Liberal 
Democratic Party. Former Secretary General Hidenao Nakagawa, who 
places importance on growing the economy, has said that there are 
reserve funds in special accounts, but lawmakers placing emphasis on 
fiscal reconstruction are reacting to remarks by such pro-growth 
 
TOKYO 00005474  005 OF 007 
 
 
lawmakers implying the avoidance of a hike in the consumption tax. 
The dispute over economic policy in the LDP may affect work of 
compiling next fiscal year's budget. 
 
Delivering a speech at an end-of-year gathering of economists held 
in Tokyo last night, Nakagawa revealed that he had suggested to 
Prime Minister Yasuo Fukuda just before the gathering that the 
government should use reserve funds in special accounts. Nakagawa 
said: "I told (the prime minister) about where surplus money is 
kept. Prime Minister Fukuda was already aware of the location." 
 
The buried funds mentioned by Nakagawa point to reserve funds in the 
Fiscal Loan Fund Special Account and in the Foreign Exchange Fund 
Special Account, totaling approximately 40 trillion yen. Nakagawa 
also proposed lowering the ratio of reserve funds to the total asset 
of the Fiscal Loan Funds Special Account, as well as moving more 
profits from managing the latter account to the general account. 
 
Chief Cabinet Secretary Nobutaka Machimura said in a press briefing 
yesterday: "It is unreasonable to say that you may spend money 
lavishly because there seem to be surplus money." There are no signs 
that the dispute will be settled soon. 
 
(5) DPJ Tax System Research Commission starts discussion: 
Reallocation of national auto tax revenues; Child allowance in place 
of dependent exemption 
 
MAINICHI (Page 5) (Full) 
December 6, 2007 
 
The Tax System Research Commission (chaired by Hirohisa Fujii) of 
the Democratic Party of Japan (DPJ or Minshuto) has started 
full-fledged discussions on annual tax code revisions for fiscal 
¶2008. It plans to outline a tax code revision outline countering the 
government-ruling camp-sponsored outline. The government is unable 
to ignore the DPJ's move due to its dominance in the Upper House 
since the July election. The DPJ is geared up to force the 
government to dissolve the Lower House for a snap election, opposing 
its budget bill, based on this outline. Focus will be a drastic 
revision of special-purpose road construction funds and the income 
tax. 
 
Attaching importance to regional areas in the wake of the crushing 
defeat in the Upper House election, the Liberal Democratic Part 
(LDP) is insisting that special-purpose road construction revenues 
should be allocated for other uses, after securing a road budget for 
the consolidation of the road systems. 
 
However, the DPJ is calling for allocating all special road 
construction funds for other purposes. It wants to give the 
impression that the LDP is negative toward reform, by proposing 
scrapping temporary duty rates of the gasoline tax and establishing 
an environment tax to be imposed on gasoline. 
 
However, many members, mainly those who were elected in regional 
constituencies are strongly against allocating road construction 
funds to be used for other purposes. One lawmaker responsible for 
national land and transport policy during an expanded meeting of 
executives of the Tax System Research Commission, said, "We should 
see how the situation develops, while keeping the special-purpose 
road-construction revenues in place." 
 
 
TOKYO 00005474  006 OF 007 
 
 
The DPJ included in its manifesto for the Upper House election this 
summer establishment of a 26,000-yen allowance per child. It eyes 
abolition of spouse tax credit and dependent exemption as funding 
resources for that. 
 
However, the proposal has been criticized by the LDP, which is 
negative toward revising the tax exemption system, because 
households without children would have to share more burdens. 
 
However, Motohisa Yoshikawa, vice chairman of the DPJ Tax System 
Research Commission underscored: "The idea is that society is 
responsible for posterity. The system will in the end lead to a 
stable social security system." 
 
The LDP has put off a consumption tax hike in fiscal 2008. The DPJ's 
stance is to maintain the current rate of 5 PERCENT  and allocate 
all revenues for pension benefit payments. If the full amount is 
allocated for pensions, revenues allocated to local governments 
would run short. However, another proposal is securing funding 
resources by establishing a new tax targeting companies. 
 
(6) Editorial: Urgency of Defense Ministry reform to prevent the 
ministry from producing another "Moriya" 
 
MAINICHI (Page 5) (Full) 
December 6, 2007 
 
The Council of Experts on Reform of the Defense Ministry has begun a 
debate to pave the way for drastic reform of the ministry as serious 
problems involving the ministry gradually come to light.  The panel 
was formed under the initiative of the Prime Minister's Official 
Residence (Kantei). It is said that the direct reason for setting up 
the council is that Prime Minister Yasuo Fukuda became furious when 
he heard of the cover-up by a Maritime Staff Office division 
director of a data error about the amount of fuel provided by the 
Maritime Self-Defense Force (MSDF) to a U.S. oilier. It is certainly 
natural for the Prime Minister to feel a sense of crisis that 
civilian control will be disrupted by the cover-up of data that is 
used a material for defense policy making. 
 
The situation has now become even more serious. 
 
With former Administrative Vice Defense Minister Takemasa Moriya 
having been arrested on charges of receiving bribes, we now know 
that serious corruption in defense administration has been going 
on. 
 
The Moriya scandal appears to be linked not only to the cozy ties 
between a defense bureaucrat and a company over the ministry's 
procurement of defense equipment but also to defense interests 
connected with politicians and Japan-U.S. relations. In order to 
obtain the public's understanding, the council has to come up with 
measures to reform the ministry to prevent a re-occurrence of such 
corruption. The panel proposed carrying out civilian control in a 
thorough manner, establishing stricter information security, and 
procuring defense equipment in a transparent way. Although the 
proposed items are interrelated issues, carrying out civilian 
control in a thoroughgoing way is the main issue. 
 
Based on a deep repentance for allowing the military to get out of 
control in the prewar period, the concept of civilian control was 
introduced in the process of the rearmament of Japan in the postwar 
 
TOKYO 00005474  007 OF 007 
 
 
era. Since the Meiji Constitution stipulated that the Emperor had 
the right to control the military, the military was free from 
parliamentary control. In the process of establishing the 
Self-Defense Forces (SDF), it was decided that civilian control 
would be carried out by "political control" by politicians elected 
by the people and "official control" by defense bureaucrats. 
 
The Moriya scandal has revealed a distorted system of civilian 
control in which official control has expanded but political control 
has become unreliable. 
 
Moriya served as administrative vice minister, the highest defense 
bureaucratic post, for four years and one month. During his tenure 
as vice minister, the defense chief's post changed six times. It was 
probably natural for Moriya, who was in charged of personnel changes 
of defense officials almost nine years, including his tenure as 
deputy vice minister, had a more powerful grip on the ministry than 
did politicians. 
 
It is stipulated that nine senior defense officials, including 
administrative vice minister, as defense counselors should support 
defense minister in drafting defense policy. However, there are 
suspicions that Moriya was the real power in controlling the 
ministry. 
 
Unless politicians or the Diet have the necessary power to control 
the SDF, measures to reform the ministry will not be effective. 
Reform of the Defense Ministry will start with politicians becoming 
the leading players in carrying out civilian control. 
 
SCHIEFFER