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UNCLAS SECTION 01 OF 08 TOKYO 001170 
 
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 04/28/08 
 
 
INDEX: 
 
(1) LDP suffers setback in Lower House by-election; Some members 
assume LDP cannot win general election under Fukuda (Mainichi) 
 
(2) Chief Cabinet Secretary Machimura: No change in plan to take 
overriding vote on bill amending Special Taxation Measures Law 
(Mainichi) 
 
(3) G-8 Sherpas meet with NGOs to discuss preventive measures 
against climate change (Asahi) 
 
(4) New Japan-U.S. agreement on HNS approved after one month delay 
by Diet (Sankei) 
 
(5) Ishiba eyes strengthening civilian control over SDF (Tokyo 
Shimbun) 
 
(6) SDF operations to be integrated into operations bureau (Nikkei) 
 
 
(7) Aeon Co. to resume sale of U.S. beef (Tokyo Shimbun) 
 
(8) Survey shows 80 PERCENT  of local governments to continue 
blanket testing even after government ends subsidies (Mainichi) 
 
ARTICLES: 
 
(1) LDP suffers setback in Lower House by-election; Some members 
assume LDP cannot win general election under Fukuda 
 
MAINICHI (Page 3) (Full) 
April 28, 2008 
 
Hideo Hiraoka, 54, of the main opposition Democratic Party of Japan 
(DPJ), defeated Shigetaro Yamamoto, 59, a new candidate backed by 
the ruling Liberal Democratic Party (LDP) in yesterday's a Lower 
House by-election in the Yamaguchi No. 2 district. The DPJ 
candidate's victory means that the public will has voted "no" to 
Prime Minister Yasuo Fukuda's management of the government. A sense 
of alarm has seized the government and ruling parties. The DPJ, in 
turn, now feels it is riding high, believing that a change in 
political administrations has now moved closer to reality. However, 
with the LDP having been driven to the brink, there is now even the 
possibility of removing the barrier to moves to find a successor to 
Fukuda as president of the LDP. 
 
Fukuda, who had just returned home from Moscow last night, told LDP 
Secretary General Bunmei Ibuki: "The election will not come off, 
 
SIPDIS 
will it?" 
 
In LDP headquarters at 9:00 p.m. on April 27, Ibuki said: 
 
"I thought we had caught up with (the opposition). It was a mistake 
that sufficient explanations on the new health care system were 
never provided. I think we failed to keep our guard up." 
 
The government and ruling coalition will take an overriding vote on 
April 30 on a bill amending the Special Taxation Measures Law, which 
would lead to reinstating the provisional gasoline tax rates. Now 
that the ruling coalition's scenario of gaining popular will by 
wining the by-election has ended in failure, there is a view in the 
 
TOKYO 00001170  002 OF 008 
 
 
ruling camp that ramming the bill through the Diet would provoke a 
public backlash against them. 
 
The Lower House will take an overriding vote on May 12 also on a 
bill amending the Road Construction revenues Special Exemption Law, 
which is aimed to extend for 10 years the tax revenues earmarked for 
road construction. However, some junior and mid-level LDP lawmakers 
have asserted that resorting an overriding vote goes against the 
policy of shifting revenues earmarked for road construction and 
maintenance to the general account starting fiscal 2009. In the wake 
of the defeat in Sunday's by-election, chances are that this view 
will gain ground in the LDP. Some LDP members are raising a view 
calling for scrapping the new health care system for the elderly, 
which was the main reason for the LDP's loss in the by-election. 
 
Fukuda's management of his administration will face a rough passage. 
A senior LDP Upper House member said: 
 
"Even if the DPJ presents a censure motion against Prime Minister 
Fukuda, the prime minister will neither shuffle his cabinet nor 
dissolve the Lower House. After the Diet session is over, the 
political mood will completely change." 
 
A person, who has close ties with Fukuda, sad: "The Group of Eight 
summit in Hokkaido in July will become an opportunity (for Fukuda) 
to boost the popularity of the government." 'There were no concrete 
grounds for the remarks by the two. 
 
Fukuda had not been regarded as strong character to use in 
elections. However, a mid-level lawmaker commented following the 
defeat of the LDP candidate in the by-election: "We have now learned 
that we will not be able to win the next Lower House election." One 
faction head, mentioning the name of Taro Aso, said: "I think he is 
a safe choice for a candidate to replace Prime Minister Fukuda with 
the next Lower House election in mind." 
 
At 7:00 p.m. yesterday when it became likely that the LDP would be 
defeated, two cars arrived at the prime minister's official 
residence. Those in the cars were former Prime Minister Yoshiro Mori 
and former LDP Upper House Chairman Mikio Aoki. The two stayed at 
the residence for about two hours and a half. The visits by Mori and 
Aoki to the prime minister's official residence suggested how 
seriously the Fukuda government had been shaken by the defeat of its 
candidate in the by-election. 
 
(2) Chief Cabinet Secretary Machimura: No change in plan to take 
overriding vote on bill amending Special Taxation Measures Law 
 
MAINICHI (Page 1) (Full) 
April 28, 2008 
 
The candidate backed by the ruling Liberal Democratic Party (LDP) 
and its coalition partner New Komeito was defeated in Yesterday's 
Lower House by-election for the Yamaguchi No. 2 constituency. This 
makes clear how the power of the government of Prime Minister Yasuo 
Fukuda has waned. The defeat will likely deal a big blow to the 
government and ruling coalition, which will take an overriding vote 
on a bill amending the Special Taxation Measures Law. Since the 
major opposition Democratic Party of Japan (DPJ) will strengthen the 
offensive against the government and ruling camp over the new health 
care system for the elderly and the provisional tax rates, the 
political situation will become fluid. 
 
TOKYO 00001170  003 OF 008 
 
 
 
The government and ruling coalition considered the Lower House 
by-election a battle to regain confidence in an overriding vote by 
wining it, as well as a good opportunity to dampen the DPJ's 
strength. 
 
For this reason, Upper and Lower House members of the ruling parties 
conducted a thorough organizational battle by getting support from 
the heads of municipalities in the constituency and organizations. 
But they failed to overcome the sharp reaction of voters against the 
controversial new medical care system for the elderly. 
 
Chief Cabinet Secretary Nobutaka Machimura said last night: "The 
nature of the by-election for the Yamaguchi No. 2 seat should not be 
considered as the judgment by the whole public. There is no change 
in the policy of taking an overriding vote on April 30." However, a 
senior LDP member is concerned about the government's hard-line Diet 
management, saying: "The gasoline prices that once dropped will be 
hiked. A severe view of the government cannot be avoided." 
 
The DJP intends to wait for the right timing for submitting a 
censure motion against the prime minister, thinking that the will of 
people was shown in the by-election. Chances are that the DPJ will 
continue to hold the initiative in the Diet until the current 
ordinary Diet session ends on June 15. So, Fukuda will find it 
increasingly difficult to steer his administration. 
 
(3) G-8 Sherpas meet with NGOs to discuss preventive measures 
against climate change 
 
ASAHI (Page 6) (Full) 
April 25, 2008 
 
Visiting Sherpas from the Group of Eight (G-8) countries for 
preliminary talks in preparation for the G-8 Hokkaido Toyako Summit 
in July had a meeting on April 24 with nongovernmental organizations 
(NGOs) in Kyoto City. Representatives from NGOs voiced their 
discontent in succession. One representative charged, "The G-8 
countries have pledged to do this or that, but they have failed to 
implement their promises." The Sherpas from the G-8 countries, 
desiring to show their accountability, were pressed to give accounts 
of their countries' approaches. 
 
The meeting was hosted by the 2008 Japan G8 Summit NGO Forum, an 
organization composed of environment or development-oriented NGOs. 
Sherpas from Japan and the European Union (EU), excluding France, 
joined the meeting and held discussions with NGO representatives 
from Asia and Africa. 
 
A representative from a U.S. NGO voiced a pessimistic view about the 
future of climate change, a major focus of debate in the upcoming 
G-8 summit, and noted: "We have been disappointed by the G-8 
countries. There will certainly be a further setback (at the G-8 
Hokkaido Toyako Summit, as well)." An NGO representative from 
Bangladesh urged the G-8 countries to take action, claiming: "Using 
people's food for biofuel is immoral. I wonder how seriously the G-8 
countries think this urgent issue is." 
 
A Japanese NGO representative ripped into the G-8 countries for 
their lack of measures in the area of health services and claimed: 
"It is necessary to establish a system to monitor progress on the 
past and future promises the G-8 made and will make and then report 
 
TOKYO 00001170  004 OF 008 
 
 
on the results of the progress every year." 
 
In response to critical views voiced by NGO representatives, 
Germany's Vice Minister for Economics and Technology Pfaffenbach 
said: "We will not move backward. We will take further steps that go 
beyond the steps taken last year." U.S. Assistant to the President 
Price said: "Action is more important than words. We will make clear 
what has happened to past promises." Meanwhile, some cited the 
limits of the G-8 summit, with one senior representative, the Sherpa 
of the European Union Vale de Almeida, saying, "It is meaningless if 
large emerging countries are left outside the framework." Japan's 
Deputy Foreign Minister Masaharu Kohno noted: "Conflicting views 
exist among the G-8 countries, but the G-8 share the same goal. As 
the host of the upcoming G-8 summit, Japan will make efforts to lead 
discussions toward a satisfactory conclusion." 
 
(4) New Japan-U.S. agreement on HNS approved after one month delay 
by Diet 
 
SANKEI (Page 5) (Full) 
April 26, 2008 
 
A Japan-U.S. special measures agreement that extends for another 
three years Japan's host nation support (HNS or "sympathy budget") 
to cover the costs of stationing U.S. forces in Japan, was approved 
in the Lower House in accordance with Article 61 of the Constitution 
(stipulating the Lower House's supremacy over the Upper House 
regarding treaties), after having been rejected by the Upper House 
plenary session on April 25 by a majority of votes from the 
opposition parties Democratic Party of Japan (DPJ), the Japanese 
Communist Party, and the Social Democratic Party,.  The government 
will give approval to the agreement at a cabinet meeting on April 30 
and it will go into effect in early May. This agreement is a kind of 
a treaty. It was the first time under the current Constitution that 
the Upper House had rejected the agreement. 
 
The HNS is a system for Japan to pay the utility charges, labor 
costs, and the expenses for the transfer of U.S. fighters for night 
landing practice. With the expiration of the old treaty at the end 
of March, a portion of the payments for the HNS had been suspended. 
Under the new treaty, the government will earmark the same budget 
amount as under the old treaty in fiscal 2008, but reduce the 
utility outlays by a total of 400 million yen in both fiscal 2009 
and 2010. 
 
Inappropriate outlays pursued in succession 
 
Hiroyuki Kano 
 
The new HNS special measures agreement failed to be approved in the 
Diet by the end of the fiscal 2008 because it was rejected by the 
Upper House. This fact has cast a shadow on the Japan-U.S. alliance. 
But more meaningful was that in the Diet debates, opposition parties 
shed light on inappropriate outlays earmarked as labor costs, for 
instance, those for workers working at entertainment facilities. For 
the Japanese government, which is in severe fiscal straits, it is a 
very heavy burden indeed to pay the HNS budget. Debate over the 
transparency of the support funds is likely to gain even more 
momentum in the months ahead. 
 
"The HNS has expanded too much. I think we need to debate it from 
scratch." 
 
TOKYO 00001170  005 OF 008 
 
 
 
This critical remark of the HNS budget came out from Shinkun Haku, a 
House of Councilors member of the DPJ, in his arguments against the 
HNS budget during the Upper House plenary session on April 25. Even 
the ruling Liberal Democratic Party's (LDP) Katsuhito Asano, a House 
of Councilors member who is supportive of the HNS budget, was 
critical in his remarks to the government, stating: "It is 
unacceptable to allow fiscal spending in an unregulated manner. 
Japan's burden has been reduced this time, but this amount is not at 
all satisfactory." 
 
Prior to signing the new agreement, the Japanese government urged 
the U.S. in bilateral talks to drastically cut utility and labor 
costs. Defense Minister Shigeru Ishiba also questioned the high 
salary levels for Japanese workers at U.S. bases. He pointed out the 
need to review the HNS from scratch. 
 
In relation to the Japan-U.S. security arrangements, Japan is 
expected to bear a huge burden in the future because of the 
construction of a missile defense system and the expenses for the 
transfer of Marines from Okinawa to Guam. In order to improve 
defense capabilities in a steady manner, while obtaining the 
taxpayers' understanding, the government believes it is "necessary 
for the U.S. side to make tangible efforts," a senior official 
noted. 
 
Meanwhile, the U.S. government has borne a huge spending burden 
stemming from the wars in Iraq and Afghanistan. Washington pressed 
Tokyo to further increase its financial burden and pay its fair 
share of the costs on the grounds of the currently unstable 
Northeast Asian situation, owing to China's military expansion. The 
amount the U.S. side reduced in this regard was a mere 800 million 
yen. 
 
During the debates on the new agreement, the opposition bloc focused 
on inappropriate outlays. Shu Watanabe, a House of Representatives 
member of the DPJ, posed a question as to why the HNS includes the 
salaries for managers of bowling alleys and bartenders. He 
criticized the government: "Why does Japan need to pay the costs for 
U.S. service members' entertainment on their holidays?" 
 
Debates on the HNS budget in the Diet had gone smoothly in the past, 
but problems about the HNS have surfaced this time. This may be a 
product of the divided Diet. 
 
But the fact that the agreement signed by both the Japanese and U.S. 
governments was approved by the Diet after a one-month delay has 
caused the U.S. government to heighten its distrust of the Japanese 
government for its inability to promptly implement policy. On top of 
that, this was the first time under the current Constitution that a 
treaty was rejected by the Upper House. Masahisa Sato, an SDF 
officer-turned House of Councilors member of the LDP, expressed a 
strong sense of crisis about the future of the Japan-U.S. alliance 
when he said: "This may have sent the wrong message not only to the 
United States but also to neighboring countries." 
 
(5) Ishiba eyes strengthening civilian control over SDF 
 
TOKYO SHIMBUN (Page 1) (Full) 
April 26, 2008 
 
The Defense Ministry yesterday revealed Defense Minister Shigeru 
 
TOKYO 00001170  006 OF 008 
 
 
Ishiba's plan to reform its organization involving the Self-Defense 
Forces. The Ground, Maritime, and Air Self-Defense Forces' 
respective staff offices and their chiefs of staff will be off the 
SDF's chain of command, according to Ishiba. Instead, the defense 
minister will directly command SDF troops. Ishiba plans to integrate 
the Defense Ministry's civilian officials and the SDF's uniformed 
staff officers to have them better assist the defense minister and 
simplify the SDF's chain of command. The plan is aimed at 
strengthening civilian control. The Defense Ministry will report the 
plan to a government panel in its meeting to be held in May. 
 
The Defense Ministry's internal bureaus and the SDF's sections in 
its staff offices for logistics, operations, budget accounts, and 
other functions will be integrated and reorganized into new sections 
for defense buildup plans, operations, and Diet affairs and public 
relations. The SDF Joint Staff Office will be in charge of SDF 
operations in general, and the SDF Joint Staff Office chief, who 
stands above all SDF personnel, will be responsible for the SDF's 
operational functions. 
 
The Defense Ministry's internal bureau directors general currently 
serve as defense counselors to advise the defense minister. The 
GSDF, MSDF, and ASDF chiefs of staff will be appointed as defense 
counselors as a step to revamp the defense ministry's advisory 
functions for its minister. 
 
The GSDF, MSDF, and ASDF staff offices will only have units for 
personnel management, education, training, and some other 
functions. 
 
Surplus personnel will be assigned to SDF units in order to stop 
each SDF branch's manning level from declining. 
 
(6) SDF operations to be integrated into operations bureau 
 
NIKKEI (Page 2) (Full) 
April 28, 2008 
 
The Defense Ministry yesterday revealed an outline of Defense 
Minister Shigeru Ishiba's initiative to reorganize the Defense 
Ministry involving the Self-Defense Forces. The Defense Ministry's 
internal bureaus and the SDF's uniformed staff offices currently 
have their respective functions of planning SDF operations. Ishiba 
plans to integrate their respective functions into an operations 
bureau to be newly established in the Defense Ministry with the SDF 
Joint Staff Office involved. The newly envisaged operations bureau 
is to be headed by an administrative official of the Defense 
Ministry. The GSDF, MSDF, and ASDF chiefs of staff will be separated 
off from the SDF's chain of command and will serve as advisors to 
the defense minister. The three SDF branches' respective staff 
offices will be substantially downscaled. 
 
The Ishiba plan is aimed at creating a new advisory system that will 
better assist the defense minister and that will improve the 
efficiency of the SDF's chain of command. The Defense Ministry is 
expected to present the plan to a government panel in its next 
meeting to be held in May at the prime minister's office. In the 
Defense Ministry, however, there are also strong objections to the 
Ishiba plan concerning how to position each of the GSDF, MSDF, and 
ASDF staff offices. The Defense Ministry may therefore come up with 
several plans without specifying details. 
 
 
TOKYO 00001170  007 OF 008 
 
 
The Defense Ministry and the SDF staff offices currently have their 
respective sections for budget accounts, logistics, and some other 
functions. The Ishiba plan is to integrate them into the Defense 
Ministry's internal bureaus and will be reorganized into sections 
for defense buildup plans, operations, and Diet affairs and public 
relations. The GSDF, MSDF, and ASDF staff offices' functions will be 
limited to personnel management, education and training management, 
and some other functions. Their surplus personnel in the 
reorganization process will be assigned to SDF units for their 
revamped manpower. 
 
The SDF Joint Staff Office chief will head the operations bureau. 
The GSDF, MSDF, and ASDF chiefs of staff will serve as aides to the 
defense minister. 
 
(7) Aeon Co. to resume sale of U.S. beef 
 
MAINICHI (Page 8) (Full) 
April 26, 2008 
 
Aeon Co. announced yesterday that it would resume the sale of U.S. 
beef starting on April 30. The Japanese major supermarket chain 
operator will handle U.S. beef for the first time in about four 
years and four months since Japan banned imports of U.S. beef in 
reaction to the first case of BSE reported in the U.S. in December 
¶2003. 
 
Of the major supermarket chains, only Aeon has refrained from 
selling U.S. beef, but it has decided to resume the sale of U.S. 
beef now that it has completed its company system to ensure the 
safety of U.S. beef, including checking all products. 
 
Aeon made the decision at a time when other supermarket chains have 
decided to remove U.S. beef from their shelves following a recent 
case of specified risk material (SRM) found in a beef shipment from 
the U.S. On the decision, Yasuhide Chikazawa, an Aeon manager, said: 
"We received confirmation that even if SRMs are mixed in boxes bound 
for Japan, such materials will be removed in our final check." He 
also cited the yen's recent appreciation against the dollar as 
another reason for its decision. 
 
Aeon itself will examine beef products from the U.S. to check if the 
import conditions are met and then will receive a third party's 
health safety certificate. Aeon has decided to inspect all beef 
products twice - after products clear the customs and when products 
are processed - as measures to ensure their safety. 
 
On April 30, Aeon will resume the sale of U.S. beef at Jusco 
Shinagawa Seaside Outlet. On May 10-11, a total 20 tons of U.S. beef 
will be placed on shelves at about 47 Jusco outlets across the 
nation.  Aeon will sell U.S. beef one weekend every month. 
 
(8) Survey shows 80 PERCENT  of local governments to continue 
blanket testing even after government ends subsidies 
 
TOKYO SHIMBUN (Page 3) (Full) 
April 26, 2008 
 
Of 76 local governments that have conducted BSE inspections on 
domestic cows, 64 governments or 80 PERCENT  of the total have 
decided to continue their blanket testing, including testing of even 
cattle 20 months of age or younger, at their own expenses for the 
 
TOKYO 00001170  008 OF 008 
 
 
time being after the government ends its subsidies in August, 
according to survey results revealed yesterday by Kyodo News 
Agency. 
 
Following a specified risk material found recently in a beef 
shipment imported from the United States, attention is being focused 
on the safety of beef again. Under such circumstances, consumers are 
expected to place greater confidence in domestic beef in terms of 
safety. Meanwhile, some officials are voicing concern about the 
additional burden to be imposed on local government finances for the 
testing of cattle aged 20 months or younger. An official of the 
Inspection and Safety Division of the Health, Labor and Welfare 
Ministry says that testing calves is meaningless from a scientific 
perspective." 
 
Those local governments willing to continue blanket testing have 
earmarked testing costs in their FY2008 initial budgets. The total 
amount is different according to the number of cows inspected, 
ranging from approximately 35 million yen in the case of Hokkaido to 
several tens of thousands of yen. The central government has 
subsidized the full amount of inspection costs, but this system will 
be completely abolished in August. 
 
Asked about why he had decided to continue blanket testing, Niigata 
Governor Hirohiko Izumida said: "There are still deep-seated 
concerns about BSE among consumers." But many gave this reply: "It 
is undesirable for us alone to stop blanket testing." In response to 
a question asking how long the testing will continue, most said they 
have not decided yet what to do after fiscal 2009. A Kagawa 
prefectural government official said: "If we are unable to stop 
blanket testing, we will face a fiscal problem." 
 
Most of the remaining 12 municipal governments replied that they 
remained undecided and were in the process of discussing what to do. 
They generally are inclined to continue blanket testing for the time 
being. A Tokyo government official said: "Since there are not many 
cattle around aged 20 months or younger, we will be able to carry 
out testing within our budget." A Kumamoto government official 
remarked: "We have not earmarked the necessary amount since it is a 
provisional budget, but discussion is underway on the possibility of 
continuing testing." 
 
SCHIEFFER