VZCZCXRO3926
PP RUEHFK RUEHKSO RUEHNAG RUEHNH
DE RUEHKO #0567/01 0640113
ZNR UUUUU ZZH
P 040113Z MAR 08
FM AMEMBASSY TOKYO
TO RUEHC/SECSTATE WASHDC PRIORITY 2213
INFO RUEKJCS/SECDEF WASHDC PRIORITY
RHEHAAA/THE WHITE HOUSE WASHINGTON DC PRIORITY
RUEAWJA/USDOJ WASHDC PRIORITY
RULSDMK/USDOT WASHDC PRIORITY
RUCPDOC/USDOC WASHDC PRIORITY
RUEAIIA/CIA WASHDC PRIORITY
RUEKJCS/JOINT STAFF WASHDC//J5//
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 8836
RUEHFK/AMCONSUL FUKUOKA 6442
RUEHOK/AMCONSUL OSAKA KOBE 0110
RUEHNAG/AMCONSUL NAGOYA 4985
RUEHKSO/AMCONSUL SAPPORO 7047
RUEHBJ/AMEMBASSY BEIJING 2006
RUEHUL/AMEMBASSY SEOUL 8066
RUCNDT/USMISSION USUN NEW YORK 8648

UNCLAS SECTION 01 OF 11 TOKYO 000567 
 
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: JAPANESE MORNING PRESS HIGHLIGHTS 03/04/08 
 
Index: 
 
1) Top headlines 
2) Editorials 
3) Prime Minister's daily schedule (Nikkei) 
 
4) Asahi poll: Cabinet support rate slips 3 points to 32 PERCENT , 
non-support rate up 4 points to 50 PERCENT ; Majority of public 
wants Defense Minister Ishiba to stay at post  (Asahi) 
 
Defense affairs: 
5) Another MSDF destroyer has accident, bumping into moored ship in 
Vietnam port  (Asahi) 
6) Has the Defense Ministry's nature changed? Reform council meets 
in order to probe such issues  (Mainichi) 
7) USFJ to ease Okinawa, Iwakuni ban on leaving base but a curfew 
after 10 pm will remain  (Asahi) 
 
8) Possibility of visit to Japan of China's President Hu may be 
postponed due to simmering poison-dumpling issue  (Mainichi) 
 
New Russian president-elect Medvedev: 
9) Prime Minister Fukuda may seek an early meeting with new Russian 
president, with an eye on Putin still being a powerful influence 
(Tokyo Shimbun) 
10) Japan searching for breakthrough on the northern territorial 
issue with the election of a new Russian president  (Asahi) 
 
11) Japan Coast Guard investigating and may file charges against 
U.S. environmental group who threw acid at whalers at sea, injuring 
three  (Sankei) 
 
Political agenda: 
12) Democratic Party of Japan (DPJ) and two other opposition parties 
boycotting Diet sessions this week  (Yomiuri) 
13) Diet stalls over fiscal 2008 budget and tax bills, now in the 
Upper House  (Mainichi) 
14) No solution in sight as ruling and opposition battle over Bank 
of Japan governorship  (Asahi) 
 
Articles: 
 
1) TOP HEADLINES 
 
Asahi: 
In poll, 59 PERCENT  favor reallocating road tax revenues for 
general expenditures 
 
Mainichi: 
Government to study emissions trading, reflecting prime minister's 
resolve to take initiative on climate change 
 
Yomiuri: 
Police to arrest dozen persons over land sharking 
 
Nikkei: 
Pioneer to stop plasma panel production, instead to specialize in 
assembling TVs 
 
Sankei: 
Japan Coast Guard looking to prosecute violent activities by 
antiwhaling group as criminal case for first time 
 
TOKYO 00000567  002 OF 011 
 
 
 
Tokyo Shimbun: 
Road tax revenues used for entertainment equipment, including 
karaoke machines, on pretext of deepening friendship 
 
Akahata: 
Local government gathering signatures to call for withdrawing 
medical system for very old people 
 
2) EDITORIALS 
 
Asahi: 
(1) Low public support: No hopes for Fukuda cabinet without 
reforming road-construction policy 
(2) Russian president: Establishment of dual-power structure 
troubling 
 
Mainichi: 
(1) Putin laughing merrily again 
(2) Changes in industrialized countries' economies: Japan first 
should take measures to boost personal consumption 
 
Yomiuri: 
(1) Ruling and opposition camps urged to engage in discussion to 
stabilize currency, stock markets 
(2) Prime minister's visit to Russia necessary to ascertain new 
Russian government's policy toward Japan 
 
Nikkei: 
(1) Selection of new BOJ government urged 
(2) Russia opts for dual power structure 
 
Sankei: 
(1) Promote study of loess from Gobi Desert in cooperation with 
other countries 
(2) New Russian president expected to chart own diplomatic policy 
 
Tokyo Shimbun: 
(1) We hope new Russian government will establish fair society 
(2) Illegal activities by antiwhaling group impermissible 
 
Akahata: 
(1) Fulfill responsibility for containing global warming in a 
resolute manner 
 
3) Prime Minister's Official Residence (Kantei) 
 
Prime Minister's schedule, March 3 
 
NIKKEI (Page 2) (Full) 
March 4, 2008 
 
10:02 
Met with Environment Minister Kamoshita, Deputy Assistant Chief 
Cabinet Secretary Saka, and Special Advisor to Cabinet Okuda at 
Kantei. 
 
10:59 
Met with Tomonashi Maruyama, winner of the Speech Contest among 
Senior High School Students on Northern Territories Issue, and 
others. Afterwards, met with Chief Cabinet Secretary Machimura and 
Deputy Chief Cabinet Secretary Futahashi. 
 
TOKYO 00000567  003 OF 011 
 
 
 
12:11 
Met with Saka, and two other deputy assistant chief cabinet 
secretaries, Ando and Yanagisawa. 
 
SIPDIS 
 
13:05 
Met with Futahashi and Office for Regional Revitalization Chief 
Yamamoto. 
 
14:30 
Met with State Minister in Charge of Science and Technology Kishida, 
Saka, Cabinet Office Vice Minister Uchida, Masuo Aizawa and Taizo 
Yakushiji, members of the Council for Science and Technology Policy. 
Afterwards, met with Administrative Vice Foreign Minister Yabunaka. 
 
15:32 
Met with Prime Ministerial Advisor Ito. 
 
16:05 
Met with Uchida and Decoration Bureau Director-General Fukushita. 
Afterwards, met with House of Representatives member Kazuo Aichi, 
and House of Councilors member Jiro Aichi. After them, met with 
Cabinet Intelligence Director Mitani. 
 
17:01 
Attended an LDP executive meeting held in Diet. 
 
17:30 
Attended a meeting for reform of the Ministry of Defense held at 
Kantei. 
 
19:20 
Met with National Defense Academy President Iokibe and 
Administrative Vice Defense Minister Sato at Kantei residence. 
 
4) Poll: 59 PERCENT  back using road-related tax revenues for other 
purposes; Cabinet support flat at 32 PERCENT , nonsupport reaches 50 
PERCENT 
 
ASAHI (Top play) (Abridged) 
March 4, 2008 
 
The Diet, in its current ordinary session, is focusing its debate on 
what to do about gasoline taxes and other road-related tax revenues 
that are currently limited to road construction and other 
road-related infrastructure projects. The Asahi Shimbun conducted a 
telephone-based nationwide public opinion survey on March 1-2, in 
which respondents were asked if they were in favor of incorporating 
the road-related tax revenues into the general account. In response, 
59 PERCENT  answered "yes," with 30 PERCENT  saying "no." The Fukuda 
cabinet's support rate was 32 PERCENT  (35 PERCENT  in the last 
survey taken in February). The support rate has been remaining low 
since it hit 31 PERCENT  in mid-December last year. The nonsupport 
rate for the Fukuda cabinet reached 50 PERCENT  for the first time 
(46 PERCENT  in the last survey). 
 
In a previous survey taken in early December last year, 46 PERCENT 
were in favor of incorporating the road-related tax revenues into 
the general account. Their proportion rose to 54 PERCENT  in the 
February survey and further increased in the latest survey. Even 
among those who support the ruling Liberal Democratic Party, 58 
PERCENT  answered "yes." The survey shows the public's growing 
 
TOKYO 00000567  004 OF 011 
 
 
support for using road-related tax revenues for other purposes. 
 
In the survey this time, respondents were also asked if they thought 
Defense Minister Ishiba should resign to take responsibility for the 
recent collision of a Maritime Self-Defense Force destroyer with a 
fishing boat that has left its two fishermen missing. To this 
question, 34 PERCENT  answered "yes," with 57 PERCENT  saying "no." 
 
Meanwhile, Prime Minister Fukuda has vowed to overhaul the Defense 
Ministry. Respondents were asked if they expected him to display 
leadership. In response, "yes" accounted for 32 PERCENT , and "no" 
at 60 PERCENT . 
 
In the breakdown of public support for political parties, the LDP 
stood at 29 PERCENT  (30 PERCENT  in the last survey). The leading 
opposition Democratic Party of Japan (Minshuto) was at 21 PERCENT 
(24 PERCENT  in the last survey). 
 
5) MSDF destroyer collides with freighter in Vietnam port 
 
ASAHI (Page 1) (Abridged) 
March 4, 2008 
 
The Maritime Self-Defense Force's destroyer Hamayuki had a minor 
collision with the Cambodian-registered freighter Masan in the 
southern Vietnamese port of Ho Chi Minh at around 10:20 a.m. 
yesterday (12:20 p.m. Japan time). The Hamayuki was dented at the 
stern, and its flagpole at the stern was bent. Some paint on the 
freighter was scraped. No one was injured in the collision. 
 
Prime Minister Fukuda told reporters yesterday evening, "I want them 
to alertly carry out their duties." The MSDF Maritime Staff Office 
commented: "There was another incident right after the Aegis 
accident. We take this fact seriously. We have asked local 
authorities to help berth the ship. However, the captain is in 
charge of overseeing pilots. We want to take preventive steps." 
 
6) Prime Minister Fukuda asks advisory panel to come up with 
proposals for Defense Ministry reform, move to put cap on criticism 
 
MAINICHI (Page 2) (Full) 
March 4, 2008 
 
The government's Council on Reform of the Defense Ministry, chaired 
by Naoya Minami, advisor to Tokyo Electric Power Co., yesterday held 
a meeting at the Prime Minister's Office (Kantei) to discuss 
responses by the Defense Ministry to the collision of the Maritime 
Self-Defense Force Aegis destroyer Atago and a small fishing boat. 
At the outset of the meeting, Prime Minister Yasuo Fukuda called on 
the panel to reflect the repentance for the collision in reform of 
the ministry. He stated: "The extremely regrettable accident 
occurred. I want you to come up with proposals for a new structure 
of the Defense Ministry and the Self-Defense Forces (SDF) that the 
public can trust." 
 
It was the first time for Fukuda to attend a meeting until the end 
of the session. The delay in communication of the collision to the 
Prime Minister and Defense Minister Shigeru Ishiba came under 
criticism. The ministry's explanations were also confused. Voices 
questioning his leadership as the supreme commander of the SDF began 
to crop up. Therefore, Fukuda appeared to have started dousing 
flames around him. 
 
TOKYO 00000567  005 OF 011 
 
 
 
In yesterday's meeting, the panel discussed how civilian control 
should be consistent based the collision. One participant said: "It 
is necessary to strengthen the commanding function of the Kantei." 
Another member criticized the accident, saying: "They have not 
learned from the past incidents." The panel is expected to discuss 
measures to make clear the purchase of defense equipment in the next 
meeting. 
 
7) USFJ eases lockdown in Okinawa, Iwakuni 
 
ASAHI (Page 34) (Full) 
March 4, 2008 
 
U.S. Forces Japan decided yesterday evening to partially call off 
its ongoing lockdown of bases in Okinawa and Iwakuni, Yamaguchi 
Prefecture, and change it to a nightly curfew from 10 p.m. through 5 
a.m. USFJ has locked down its bases in Okinawa and Iwakuni since 
Feb. 20 to bar U.S. military personnel and civilian employees from 
going out in the wake of an Okinawa-based U.S. Marine's alleged rape 
of a local junior high school girl. The Marine was recently released 
as prosecutors have now decided to drop the case. Meanwhile, the 
U.S. military is continuing its investigation into the case. The 
nightly curfew has been enforced for the Army, Navy, Air Force, and 
Marine Corps since yesterday evening. 
 
USFJ will continue its no-drinking action. However, off-base U.S. 
military personnel are allowed to drink only at their homes. 
Civilian employees and family members are also prohibited from going 
out and drink outside bases. This action will be called off. 
 
U.S. military personnel's off-base activities have been minimized to 
workplaces, medical facilities, and some other limited areas. USFJ 
leadership will decide after a while on whether to call off the 
curfew and drinking prohibition. 
 
8) Option of postponing Hu's visit to Japan crops up in government 
due to dumpling incident 
 
MAINICHI (Page 2) (Abridged slightly) 
March 4, 2008 
 
Some in the Japanese government have begun voicing the need to make 
rearrangements for the timetable for Chinese President Hu Jintao's 
planned visit to Japan while bearing in mind the possibility that it 
will be postponed from "around cherry-blossom time" in April, as 
originally scheduled, to mid-May or later. Such a development is 
connected with the Foreign Ministry's intention to settle the 
conflict between Chinese and Japanese investigative and public 
security authorities over where a pesticide has gotten mixed into 
gyoza dumplings made in China by confirming food safety. There are 
growing calls in the government, including aides to the prime 
minister, for reexamination, saying the cause must be determined 
first. 
 
When Chinese State Councilor Tang Jiaxuan visited Japan on February 
20, he sounded out the government on a plan for President Hu to make 
a four-day visit to Japan stating on April 20. Based on this, Japan 
has been studying such events as a summit meeting, an audience with 
the Emperor, and a speech at the University of Tokyo. 
 
Then a situation arose in which Japan and China locked horns over 
 
TOKYO 00000567  006 OF 011 
 
 
the results of a scientific test for the pesticide detected in the 
dumplings. Japan's National Police Agency reacted strongly to 
China's announcement. High-level officials at the Prime Minister's 
Office also sided with the NPA, saying: "It is meaningless to 
establish a Japan-China consultative organ when the cause is not 
determined." 
 
As a result, China's General Administration of Quality, Supervision, 
Inspection and Quarantine Director Li Changjiang's visit to Japan, 
scheduled for March 2, has also been postponed. Li was scheduled to 
hold a meeting with Health, Labor, and Welfare Minister Yoichi 
Masuzoe and confirm "food safety" and declare closer cooperation 
between the two countries. 
 
The Foreign Ministry might have to reschedule for a Fukuda-Hu summit 
meeting. As for the prime minister's timetable after April 20, South 
Korean President Lee Myung Bak is scheduled to visit Japan on his 
way back from the United States. The prime minister is also 
considering visiting European countries and Russia from the Golden 
Week holiday period from late April through early May. Once Hu's 
visit is postponed, it might have to be put off until mid-May or 
later. 
 
Prime Minister Fukuda is expected to invite President Hu to the Lake 
Toya G8 Summit in July. There are concerns that China might postpone 
Hu's visit to Japan in spring, saying that it is too close to the G8 
summit. 
 
9) Japan hopeful of breakthrough in stalled talks on Northern 
Territories; Fukuda considering visiting Russia as soon as possible 
 
TOKYO SHIMBUN (Page 2) (Full) 
March 4, 2008 
 
Yuji Nishikawa 
 
In the Russian presidential election, First Deputy Prime Minister 
Medvedov secured an overwhelming victory. Referring to this election 
result, the Japanese government has noted that there will be no 
significant shift in Russia's policy toward Japan with Chief Cabinet 
Secretary Nobutaka Machimura saying, "The new president is likely to 
 
SIPDIS 
follow President Putin's foreign policy." Meanwhile, because 
President Putin has indicated that he, as "prime minister," will 
continue to address the Northern Territories issue, a major 
outstanding issue lying between Japan and Russia, Tokyo has 
expectations that the stalled talks on the Northern Territories, a 
major outstanding issue lying between Japan and Russia, will be 
resolved. 
 
Late yesterday Prime Minister Yasuo Fukuda said, "I don't think 
there will be any change in Japan-Russia relations. I will strive to 
resolve the major pending issue. I hope the new (Russian) president 
will have a frank discussion with us." 
 
With President Putin certain to assume the post of prime minister, a 
senior Foreign Ministry official noted, "It will take some time to 
see" how Putin and President-Elect Mededov will share the role. 
Tokyo thinks that as a "new prime minister," Putin will retain his 
strong clout on the diplomatic front, as well. 
 
In the days of the Putin administration, economic ties between Japan 
and Russia have been strengthened, but the Northern Territories 
 
TOKYO 00000567  007 OF 011 
 
 
issue made no headway. The Japanese government's fundamental 
position about the issue is that the four disputed northern islands 
be returned in a package. Tokyo has not budged even an inch from 
this position. 
 
President Putin has indicated that as a prime minister, he will 
address the Northern Territories issue. In response to this, Fukuda 
sent Putin a personal letter saying that "I hope to put Japan-Russia 
ties on a higher level" via former Prime Minister Yoshiro Mori in 
last December, when Mori was visiting Russia. 
 
Fukuda plans to travel European countries during the Golden Week 
holidays in May in order to ask for their cooperation on the 
upcoming Group of Eight Hokkaido Toyako Summit in July. Fukuda is 
considering visiting Russia as part of this tour. By building 
personal ties with Putin and Medvedov, Fukuda wants to find a clue 
to resolving the Northern Territories issue. 
 
10) Following Medvedev's victory in Russian presidential election, 
Japan exploring ways to move Northern Territorial issue forward 
 
ASAHI (Page 2) (Full) 
March 4, 2008 
 
"There is a major issue pending between Japan and Russia. We will 
make utmost efforts to improve the situation. I expect the new 
president will hold frank talks with Japan." 
 
Following Dmitry Medvedev's landslide victory in the presidential 
election in Russia, Prime Minister Fukuda indicated his desire to 
find an opening for moving forward negotiations on a territorial 
dispute over four Russian-held islands off Hokkaido. Based on the 
view that Vladimir Putin will continue to play a key role in working 
out policy toward Japan, including the territorial row, the Japanese 
government intends to ascertain how Putin and Medvedev will share 
roles. 
 
The government has started coordination on a visit to Russia by 
Fukuda during the May Golden Week Holiday to meet outgoing Putin. If 
there is an offer from Russia, the government will also look into 
having a highest-level official attend the presidential inaugural 
scheduled for May, according to informed sources. A senior Foreign 
Ministry official said that if the prime minister visits Russia 
prior to the Lake Toya Summit, he may be able to meet both outgoing 
and incoming presidents." 
 
When former Prime Minister Mori handed a personal letter from Fukuda 
over to Putin during his visit to Russia last December, Putin 
commented on the Northern Territorial issue: "I believe we will be 
able to find a solution acceptable for both sides. I want you to 
relay to Prime Minister Fukuda my message that I truly want to 
resolve the issue." He then expressed his view that there will be no 
change in the relationship between Russia and Japan after the change 
of government. Later, Putin sent to Japan a letter noting that he 
agreed to promoting Russian-Japan relations, including negotiations 
on the territorial issue, to a higher level. 
 
No progress was made in negotiations on the territorial issue under 
the Koizumi and Abe governments. Given this, the Japanese government 
has interpreted such recent moves by Russia as an expression of its 
eagerness to settle the issue. A senior Foreign Ministry official 
said: "We would like to produce some positive results in the 
 
TOKYO 00000567  008 OF 011 
 
 
atmosphere that we have finally regained after many years." Even so, 
the gap in both sides' views over the Northern Territorial issue 
remains wide. 
 
In a speech in Tokyo in February, Russian Ambassador to Japan 
Mikhail Bely said: "I think Mr. Medvedev's first overseas trip as 
president will be a trip to Japan for the Lake Toya Summit," 
indicating that Hokkaido will be the stage for the new Russian 
president to make a diplomatic debut. Keeping Medvedev's little 
diplomatic experience in mind, many government officials think that 
Japan's negotiating partner may be Putin for the time being. 
 
11) U.S. environmental group again obstructs research whaling: JCG 
for first time builds case for investigation; Three injured, 
including maritime safety officials 
 
SANKEI (Top Play) (Excerpts) 
March 4, 2008 
 
People aboard a ship belonging to Sea Shepherd, a U.S. environmental 
group, threw bottles containing chemicals at the Nisshin Maru, the 
mother ship of a fleet of research whaling vessels in the Southern 
Ocean, injuring three persons. Taking the incident seriously, the 
Japan Coast Guard (JCG) the same day started an investigation on 
suspicion of Sea Shepherd obstructing business by force and assault. 
This is the first investigation by the JCG into interference with 
Japan's research whaling. 
 
According to the JCG, the Nisshin Maru's operation was obstructed 
with bottles containing butyric acid giving out a foul smell and 
bags with white powder, with more than 100 objects thrown from the 
protest ship for about an hour. 
 
During the incident, two JCG guards aboard the Nisshin Maru and one 
crew member were slightly injured, as they got butyric acid in their 
eyes. The ingredients of the white powder are not known. 
 
The JCG has launched an investigation, because maritime safety 
officials with the right to investigate maritime crimes witnessed 
the incident on the spot and they themselves were injured. 
 
The JCG will seek to identify the perpetrators, using a videotape 
that captured them throwing bottles onto the deck. As soon as the 
suspects are identified, the JCG intends to ask for investigative 
cooperation from the relevant country through a diplomatic channel. 
 
This is the third time for Sea Shepherd to obstruct Japan's research 
whaling in the Southern Ocean. Since maritime safety officials were 
not aboard the ships in the past two incidents, the JCG had been 
unable to launch an investigation. 
 
12) DPJ to boycott Diet deliberations slated for this week both in 
Lower and Upper Houses 
 
YOMIURI (Page 2) (Full) 
March 4, 2008 
 
Democratic Party of Japan (DPJ or Minshuto) President Ozawa and 
Secretary General Hatoyama yesterday held a meeting yesterday in the 
 
SIPDIS 
Diet and confirmed not to attend deliberations in both the Lower and 
Upper Houses at least this week. They are objecting strongly to the 
ruling parties for having approved the fiscal 2008 budget bill and 
 
TOKYO 00000567  009 OF 011 
 
 
tax system-related bills by the Lower House, while opposition 
parties abstained from a roll call. Regarding talks to revise the 
bill amending the Special Tax Measures Law, including the 
maintaining of the provisional gasoline tax rate, they decided to 
look into that possibility when the ruling parties present revised 
proposals. 
 
Then, secretaries general of the DPJ, the Social Democratic Party 
(SDP) and the People's New Party (PNP) met in the Diet and shared 
the view that the proposal made by the Lower House speaker and the 
Upper House president that a  certain level of a conclusion be 
reached before the end of the year has fallen apart. They confirmed 
to act in unity in dealing with the immediate Diet session, 
including boycotting Diet deliberations. 
 
DPJ Secretary General Hatoyama told reporters, "The ruling parties 
need to offer an unequivocal apology for abandoning the mediation 
proposal made by the speaker of the Lower House and the president of 
the Upper House." He thus indicated his party's stance that an 
apology by the ruling parties will be one condition for the 
opposition camp to respond to a call for attending Diet 
deliberations. 
 
In the meantime, the Upper House Budget Committee yesterday held a 
meeting of directors of the ruling parties and decided by virtue of 
Chairman Yoshitada Konoike's office to hold a basic 
question-and-answer session with Prime Minister Fukuda and others in 
attendance. However, since the DPJ and other opposition parties, 
which have a majority of seats in the Budget Committee, intend to 
abstain from the session, the planned meeting will unlikely be held 
with the number of participants falling short of the quorum. The 
Lower House Land, Infrastructure and Transport Committee at a 
round-table meeting of directors put off a committee meeting slated 
for the 4th. 
 
13) Diet stalled as opposition decides to boycott deliberations for 
one week 
 
MAINICHI (Page 2) (Full) 
March 4, 2008 
 
The Diet was stalled yesterday as it was unable to launch 
deliberations on the fiscal 2008 budget bill, which is now before 
the opposition-controlled House of Councillors. The opposition camp 
reacted negatively to the ruling parties, contending that the ruling 
coalition unilaterally passed the budget bill in the House of 
Representatives. A senior member of the main opposition Democratic 
Party of Japan (DPJ or Minshuto) said: "Since the ruling camp took a 
forced vote, we won't be able to join deliberations for a week." The 
opposition bloc has stressed that the ruling coalition ignored the 
mediation effort by the leaders of the two Diet houses, under which 
the two sides reached an agreement to reach a conclusion by the end 
of this fiscal year on the budget bill, as well as on a bill 
revising the Special Taxation Measures Law, including measures to 
retain the current provisional gasoline tax. As such, the opposition 
has toughened its hard-line stance. There is no prospect for the 
convocation of deliberations in the Upper House. 
 
In a meeting yesterday of directors of the Upper House Budget 
Committee, the ruling camp proposed convening deliberations on the 
FY2008 budget today. The opposition, however, turned down the 
proposal. Therefore, the discussion did not go anywhere. And a 
 
TOKYO 00000567  010 OF 011 
 
 
meeting between ruling Liberal Democratic Party Diet Affairs 
Committee Chairman Seiji Suzuki and his DPJ counterpart Susumu 
Yanase ended in failure, as well. 
 
The secretaries general of the DPJ, the Social Democratic Party, and 
the People's New Party held a meeting in the Diet building. The 
three shared the perception that the agreement reached by the ruling 
and opposition camps through the good offices of the leaders of two 
Diet chambers was scrapped. They also affirmed that the three 
opposition parties would boycott a meeting to be held today in 
virtue of the authority of Upper House Budget Committee Chairman 
Yoshitada Konoike. 
 
The DPJ has already submitted to the Diet its own bills on the 
integration of the special account of road-related taxes into the 
general account and on the abolition of the provisional tax rates, 
as counterproposals toward a revision of the government-drafted 
bills. The largest opposition party intends to urge the ruling 
coalition to carry out deliberations on its own bills before 
deliberating on the government's bills, hoping to assume the 
initiative in the Upper House. 
 
The ruling camp, however, is alarmed that a prolonged stalemate in 
the Diet and a delay in consultations on a review of the government 
bills would give the opposition an excuse to not take a vote on the 
bills. The ruling parties have begun making efforts to have the 
opposition join consultations. However since there are big 
differences between the bills of the government and the DPJ, a 
senior LDP Upper House member indicated yesterday a negative view 
about a drastic review of the government bills. 
 
14) Nomination of BOJ governor: Calls for Muto's promotion still 
strong in government, ruling bloc 
 
ASAHI (Page 4) (Excerpts) 
March 4, 2008 
 
The bargaining between the government and ruling coalition and the 
opposition camp over the appointment of the new Bank of Japan 
governor has now taken on an aspect of a game of "chicken." Reacting 
strongly to the ruling bloc, which has rammed the budget and 
budget-related bills through the Lower House, the major opposition 
Democratic Party of Japan (DPJ) has decided that in the event the 
government and ruling camp present a plan to promote BOJ Deputy 
Governor Toshiro to the governor's post, it will not give its 
consent. Meanwhile, in the government and ruling bloc, the view is 
still predominant to nominate Muto. BOJ Governor Toshihiko Fukui's 
term of office will expire in a little over two weeks. No exit is in 
sight for the selection of a new BOJ governor. 
 
LDP Secretary General Bunmei Muto made a speech in Kobe on March 1, 
the day after the Lower House approved the budget related bills. In 
it, Ibuki applied pressure on the DPJ by citing Muto, saying: "The 
DPJ is saying that because the LDP did what the DPJ did not agree 
to, they will not endorse Mr. Muto. The logic is absurd." 
 
A senior LDP member also said: "We should take the proper approach 
without worrying about the DPJ." A government official commented, "I 
think the prime minister has made up his mind." There are strong 
calls in the government and ruling bloc that the policy to promote 
Muto should not be changed. 
 
 
TOKYO 00000567  011 OF 011 
 
 
The government and ruling bloc are enamored with the idea of 
promoting Muto because he truly understands financial affairs and 
can also go along with the government's policy, according to a 
government source. An aide to the prime minister also said: "It's 
not a position just for anyone. There are no other good 
candidates." 
 
Since he became deputy governor in 2003, Muto has been regarded as a 
shoo-in for the BOJ governorship. The government's five-year plan 
will fall through with a collapse of its scenario to appoint Muto. 
 
Further, the government and ruling camp fear that if they agree to 
the DPJ's call for replacing Muto with a new candidate, that will 
take a heavy toll on the prime minister's grip on power in the 
government and the party. 
 
SCHIEFFER