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Viewing cable 08TOKYO1978, JAPANESE MORNING PRESS HIGHLIGHTS 07/17/08

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Reference ID Created Released Classification Origin
08TOKYO1978 2008-07-17 01:11 2011-08-26 00:00 UNCLASSIFIED Embassy Tokyo
VZCZCXRO9298
PP RUEHFK RUEHKSO RUEHNAG RUEHNH
DE RUEHKO #1978/01 1990111
ZNR UUUUU ZZH
P 170111Z JUL 08
FM AMEMBASSY TOKYO
TO RUEHC/SECSTATE WASHDC PRIORITY 5892
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 1267
RUEHFK/AMCONSUL FUKUOKA 8893
RUEHOK/AMCONSUL OSAKA KOBE 2622
RUEHNAG/AMCONSUL NAGOYA 7109
RUEHKSO/AMCONSUL SAPPORO 9476
RUEHBJ/AMEMBASSY BEIJING 4406
RUEHUL/AMEMBASSY SEOUL 0396
RUCNDT/USMISSION USUN NEW YORK 0801
UNCLAS SECTION 01 OF 11 TOKYO 001978 
 
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 07/17/08 
 
Index: 
 
1) Top headlines 
2) Editorials 
Prime Minister's daily schedule: At home on vacation 
 
Diplomatic scene: 
3) 62 separate talks held between top leaders from 22 countries in 
the four days of the G-8 summit  (Yomiuri) 
4) ROK spokesperson denies Yomiuri press report about President Lee 
warning Prime Minister Fukuda not to let Takeshima issue into 
teacher's manual  (Yomiuri) 
5) Japanese, South Korean academics to debate Takeshima isles issue 
(Asahi) 
6) Mainichi poll finds almost half the public pessimistic about 
resolving abduction issue once U.S. removes North Korea from the 
list of terrorist-sponsoring states  (Mainichi) 
7) LDP's Taku Yamasaki wants Japan to propose method for 
reinvestigation of abduction issue in DPRK  (Tokyo Shimbun) 
8) Yamasaki is negative about new Afghan dispatch by SDF, saying 
that ruling camp has not lined up yet behind the plan  (Asahi) 
9) NATO welcomes Japan dispatch of SDF to Afghanistan  (Mainichi) 
10) Foreign Ministry appoints academic to serve as UN Headquarters 
official in charge of PKO policy  (Nikkei) 
11) Finance Minister Nukaga meets UAE counterpart on providing 
increased capital investment to boost oil production, invites 
oil-money investment in Japan  (Nikkei) 
 
12) Cabinet Office's computer simulation predicts fiscal 2011 
primary-balance deficit will rise to 2 trillion yen  (Mainichi) 
 
DPJ in action: 
13) Group of junior DPJ lawmakers propose to party head Ozawa the 
goal of creating an international cooperation corps for UN PKO and 
humanitarian aid  (Tokyo Shimbun) 
14) Junior DPJ lawmakers will not run a candidate against Ozawa in 
the upcoming party presidential election  (Sankei) 
15) DPJ election campaign promise to review privatization of postal 
services  (Yomiuri) 
16) DPJ's Maehara and LDP's Yosano becoming politically close these 
days  (Yomiuri) 
 
Political agenda: 
17) LDP hard at work preparing for possible cabinet shuffle, while 
Fukuda silently vacations at home  (Nikkei) 
18) LDP hopeful Tanigaki trying to demonstrate his political 
presence in order to run in party presidential race  (Mainichi) 
19) LDP Secretary General Ibuki drives a nail in the coffin of the 
idea in the party to talk about raising taxes prior to a possible 
national election  (Sankei) 
20) All LDP eyes on faction leader Machimura, currently chief 
cabinet secretary, to see how he comes out in possible cabinet 
shuffle by the prime minister  (Tokyo Shimbun) 
 
Articles: 
 
1) TOP HEADLINES 
 
Asahi: 
Oita bribery scandal prompts 14 prefectures to review recruitment 
exams for teachers 
 
 
TOKYO 00001978  002 OF 011 
 
 
Mainichi: 
Country's FY 2007 medical expenditures estimated at 33.4 trillion 
yen; People over 70 account for record 43 PERCENT  of expenditures 
 
Yomiuri: 
Cellphone service providers to enhance measures against bank 
transfer scams using cellphones; Police to respond to inquiries from 
service providers 
 
Nikkei: 
Tax burden on Japanese manufacturers falls to record low in FY 2007 
 
Sankei: 
Teacher selection criteria not made public by 44 local governments 
 
Tokyo Shimbun: 
14-year-old boy hijacks bus 
 
2) EDITORIALS 
 
Asahi: 
(1) Fisheries industry needs new system that can fight soaring fuel 
cots 
(2) Fresh breeze for Akutagawa Prize 
 
Mainichi: 
(1) U.S. financial crisis needs fundamental measures 
(2) Country needs sound FY2009 budget 
 
Yomiuri: 
(1) Defense Ministry reform must forge strong body 
(2) Kanezo Muraoka found guilty by top court: Nagatacho's common 
sense rejected 
 
Nikkei: 
(1) Nuclear power plants must be quake resistant 
(2) Anheuser-Busch agrees to InBev buyout 
 
Sankei: 
(1) Fisheries industry needs structural reform 
(2) Chinese author wins Akutagawa Prize 
 
Tokyo Shimbun: 
(1) New Akutagawa Prize story begins 
(2) Do away with organizational logic in reforming MOD 
 
3) 62 separate talks held between top leaders from 22 countries in 
the four days of the G-8 summit 
 
YOMIURI (Page 2) (Full) 
July 17, 2008 
 
It has been learned that a total of 62 separate talks were held in 
four days between top leaders of 22 countries, who took part in the 
Group of Eight summit in Hokkaido. The 62 separate summit meetings 
were held at The Windsor Hotel from July 6, the day before the 
opening of the G-8 summit, through the 9th, the closing day of the 
summit. According to the Ministry of Foreign Affairs, the number is 
the largest ever compared with that held at the past G-8 summits. 
 
Prime Minister Yasuo Fukuda had 15 meetings, the largest number, 
followed by the ten meetings by Russian President Dmitry Medvedev, 
 
TOKYO 00001978  003 OF 011 
 
 
and by the eight sessions by U.S. President George W. Bush. 
 
In the G-8 outreach session, newly developing countries called 
"BRICs" demonstrated their solidarity. A senior MOFA official said: 
"Countries other than the G-8 nations have now taken advantage of 
the G-8 summit to play up their presence." 
 
Since the G-8 Hokkaido Summit took up such global issues as climate 
change and food crisis, as well as African development, a record 
high of 22 countries, including the G-8 members, participated in the 
summit. 
 
4) Seoul denies Yomiuri report on Takeshima 
 
YOMIURI (Page 2) (Full) 
July 17, 2008 
 
SEOUL-Lee Dong Kwan, a spokesman for South Korean President Lee 
Myung Bak, met domestic media reporters on July 15 and denied a 
Yomiuri Shimbun report on the president's remarks over the 
advisability of describing the issue of Takeshima, a group of 
disputed islets in the Sea of Japan, in an education ministry manual 
explaining new middle school curriculum guidelines for social 
studies. The Yomiuri Shimbun reported that President Lee told Prime 
Minister Fukuda: "Don't do that right now. I want you to wait." The 
spokesman, however, said the president "never said anything like 
that."  "That's groundless," the spokesman added. 
 
The spokesman, meeting the press yesterday, said the South Korean 
government was studying what to do next. 
 
5) South Korea to urge Japan to allow school textbook sub-panel to 
discuss Takeshima issue 
 
ASAHI (Page 4) (Abridged slightly) 
July 17, 2008 
 
Seoul 
 
The South Korean government intends to urge Japan to let the 
Japan-South Korea joint history research committee's school textbook 
sub-committee composed of scholars of the two countries to handle 
the Takeshima/Dokdo issue. The step follows President Lee Myung 
Bak's instruction yesterday to consider having both countries 
produce joint history textbooks. The step seemingly aims at renewing 
Seoul's assertion that Takeshima is South Korea's territory through 
the envisaged subcommittee discussions. 
 
The governments of Japan and South Korea agreed at the October 2006 
bilateral summit to set up a history textbook subcommittee under the 
joint history research committee composed of scholars of the two 
countries. Although the committee's second-term plenary meeting has 
been underway since June 2007, how much it can affect the 
government's basic policy is unclear. 
 
Japan thinks South Korea's response to the Takeshima issue is calmer 
than the previous Roh Moo Hyun administration's that immediately 
escalated into changes to the diplomatic timetable. The government 
is also watching closely whether South Korea will respond to Japan's 
call for a Japan-ROK foreign ministerial on the sidelines of an 
international conference in Singapore next week. 
 
 
TOKYO 00001978  004 OF 011 
 
 
Japan has informally requested the bilateral foreign ministerial, 
but South Korea replied that the matter is under consideration, 
according to an informed source. 
 
6) Poll: 47 PERCENT  pessimistic about abduction issue due to N. 
Korea's delisting 
 
MAINICHI (Page 2) (Abridged) 
July 17, 2008 
 
In the wake of North Korea's nuclear declaration, the United States 
is now in the process of delisting North Korea as a state sponsor of 
terrorism. The Mainichi Shimbun, in its recent telephone-based 
nationwide public opinion survey conducted July 12-13, asked 
respondents about the possible impact on the issue of Japanese 
nationals abducted to North Korea. In response to this question, 47 
PERCENT  answered that the issue is now far off from a solution, 
with 42 PERCENT  saying the delisting and the abductions are 
different issues and 2 PERCENT  saying the issue is now nearing a 
resolution. 
 
Meanwhile, the Japanese government welcomed the U.S. government's 
decision to remove North Korea from its terrorism blacklist in 
response to its nuclear declaration, taking the position that it 
will help resolve the North Korean nuclear issue. In the survey, 
respondents were asked if they supported this move. To this 
question, 66 PERCENT  answered "no," with 19 PERCENT  saying "yes." 
The government expected its response to the North Korea problem to 
score points on the diplomatic front. Its stance, however, did not 
necessarily obtain public understanding, as is evident from the 
survey. 
 
7) LDP Yamasaki urges government to present method for 
reinvestigation of Japanese abductees in North Korea 
 
TOKYO SHIMBUN (Page 2) (Full) 
July 17, 2008 
 
(Kyodo News, Beijing) 
 
Former Liberal Democratic Party Vice President Taku Yamasaki, now 
visiting China, told Japanese reporters in Beijing on July 16 this 
about the reinvestigation of Japanese abduction victims: "It is 
necessary for Japan to present an investigation method. I say the 
sooner, the better." The reinvestigation was agreed on in recent 
working-level talks between Japan and North Korea. 
 
Yamasaki said: "It would be better for Japan to join the 
reinvestigation," but he added: "Since there are opposing views, 
coordination in the government is necessary." 
 
Yamasaki ruled out the possibility of his contacting North Korean 
officials who are involved in the abduction issue. 
 
In reference to a cabinet shuffle, Yamasaki emphasized that if Prime 
Minister Fukuda decided to shuffle the cabinet, he should respect 
opinions in LDP factions. Regarding dissolution of the House of 
Representatives for a snap election, he remarked: "If the cabinet is 
shuffled, the Lower House will not be dissolved at least for six 
months. But a general election at the outset of the ordinary Diet 
session next year is fully conceivable." 
 
 
TOKYO 00001978  005 OF 011 
 
 
8) Yamasaki dismissive of sending SDF to Afghanistan 
 
ASAHI (Page 4) (Abridged slightly) 
July 17, 2008 
 
Beijing 
 
LDP Foreign Affairs Research Council Chairman Taku Yamasaki speaking 
to the press on July 16 in Beijing expressed a negative view about 
the government and ruling camp's plan to send the Self-Defense Force 
to Afghanistan as the next step after the refueling assistance 
special measures law expires in January. He said: "It is difficult 
to make a political decision on ground-based assistance along with 
(activities) in the Indian Ocean." 
 
In response to expectations of Western countries, the government 
sent a fact-finding team to Afghanistan and its neighboring 
countries. The government is searching for the possibility of the 
SDF's airlift support for the multinational forces and other 
options. But there are no prospects for obtaining the understanding 
of the major opposition Democratic Party of Japan under the divided 
Diet, in addition to resistance by the LDP's coalition partner of 
the New Komeito. Yamasaki said: "Politically there are too many 
obstacles to enact new legislation, and the ruling bloc would not be 
able to come up with a unified view." Yamasaki also made this 
comment about North Korea's pledge to reinvestigate the abduction 
issue: "There is a need to present methods, including whether or not 
Japan will join the reinvestigation; the earlier the better." 
 
Yamasaki also called for an early cabinet shuffle, saying that such 
would be helpful to shore up support ratings. He also indicated that 
factions should refrain from recommending any candidates for cabinet 
posts, saying: "Although I would like to see the prime minister 
listens to factional views rather than acting like former Prime 
Minister Koizumi, who decided matters arbitrarily, Prime Minister 
Fukuda should pick the new members from a broad range of people in 
order to generate his own policy imprint." 
 
9) SDF dispatch welcome in Afghanistan: NATO spokesman 
 
MAINICHI (Page 2) (Full) 
July 17, 2008 
 
BRUSSELS-The North Atlantic Treaty Organization (NATO) appreciates 
Japan for its financial aid to Afghanistan's reconstruction, a NATO 
spokesman said while referring to the fact that the Japanese 
government is now considering sending troops from the Self-Defense 
Forces to Afghanistan. "If Japan hopes to do more, we will welcome 
it," the spokesman said, adding that it is for the Japanese 
government to decide where to send SDF troops and what to do there. 
 
10) Hitotsubashi University visiting professor picked as UN Policy 
Evaluation and Training Division director 
 
ASAHI (Page 4) (Full) 
July 17, 2008 
 
The Ministry of Foreign Affairs announced yesterday that 
Hitotsubashi University Professor Izumi Nakamitsu, 45, had been 
hired as director of the United Nations' Secretariat's PKO 
(peacekeeping operations) Division in charge of policy evaluation 
and training. According to the ministry, Nakamitsu is the second 
 
TOKYO 00001978  006 OF 011 
 
 
Japanese to serve in such a management post in UN Headquarters, 
followed by Kiyotaka Akasaka, deputy secretary general responsible 
for public relations. Nakamitsu is expected to arrive at the post in 
early August. 
 
Nakamitsu served in such posts as head of UNHCR Mostar office in 
Sarajevo, and  the former Yugoslavia UN secretary general's special 
senior assistant officer. As a specialist to resolve disputes and 
building peace, he has been a visiting professor at the Hitotsubashi 
University since 2007, after serving as a professor at the 
Hitotsubashi University graduate school since 2005. 
 
Foreign Ministry Press Secretary Kazuo Kodama stated yesterday at a 
press conference: "I think his appointment is extremely significant 
for Japan as part of efforts to become a peace cooperation 
country." 
 
11) Finance minister visits UAE: Calls on oil-producing countries to 
improve production facilities; Asks for cooperation on crude oil 
prices; Also meets with senior official of government-affiliated 
investment fund with aim of luring investment to Japan 
 
NIKKEI (Page 5) (Excerpts) 
July 17, 2008 
 
Abu Dhabi, Manabu Morimoto 
 
Finance Minister Fukushiro Nukaga, now visiting the United Arab 
Emirates (UAE), on July 16 met with his counterpart Al-Tayer. In an 
effort to address the steep rise in crude oil prices, he sought 
cooperation from the UAE. He asked the nation to increase its oil 
production capacity and help constrain speculative transactions by 
improving information disclosure. He also met with a senior official 
of the government-affiliated investment fund SWF with the aim of 
luring oil money to Japan. He will then visit Kuwait on July 17. He 
is expected to call for cooperation from other countries in the 
region, explaining measures to deal with surging crude oil prices 
that industrialized countries agreed on at the G-8 summit in 
Hokkaido. 
 
Participants in the G-8 summit and other related meetings agreed 
that oil consumer countries, such as Japan, the U.S. and European 
countries, should step up energy-conservation efforts. In the 
meantime, they sought cooperation from oil-producing countries, 
including boosting production volume and refining capacity, 
improving the transparency of market data on crude oil, such as 
stockpiles and production capacity, and analyzing the impact of 
demand and speculative movements on the high crude oil prices. 
 
Though demand for crude oil in China and India is continuing to 
increase, the outlook for oil-producing countries' future supply 
capability is unclear. It is believed that outdated production and 
refining facilities are contributing to the steep rise in crude oil 
prices. Nukaga during the meeting asked the UAE to boost capital 
spending, which would lead to an increase in mid- to long-term oil 
supplies. He stressed Japan's stance that it is ready to help the 
nation on the technological front. 
 
In response, Al-Tayer indicated a stance of basically cooperating 
for the G-8 agreement to constrain the high crude oil prices. 
However, he underscored that it was impossible to boost production 
immediately, citing labor and facility shortages. He also called for 
 
TOKYO 00001978  007 OF 011 
 
 
a swift analysis by the International Monetary Fund (IMF) or other 
international agency of the impact of speculative investment on 
crude oil prices, pointing out, "The supply-demand issue may not be 
the only factor contributing to the steep rise in crude oil prices. 
Speculative money may be another factor." 
 
12) Deficit in primary balance for fiscal 2011 to top 2 trillion 
yen, according to Cabinet Office estimate; Deterioration caused by 
economic slowdown 
 
MAINICHI (Page 1) (Excerpts) 
July 17, 2008 
 
It was learned on July 16 that the Cabinet office in its latest 
fiscal estimate projected that a deficit in the primary balance of 
the central and local governments for fiscal 2011 would exceed 2 
trillion yen. Such an estimate as of January was only about 700 
billion yen. However, the fiscal outlook will significantly change 
for the worse with a fall in tax revenues following the economic 
slowdown. 
 
The projection will be submitted to a meeting of the Council on 
Economic and Fiscal Policy on July 22. The government incorporated 
in the basic policy guidelines on economic and fiscal management and 
structural reforms for the fiscal 2006 a target to move the primary 
balance into the black in fiscal 2011 and lower the proportion of 
government debt to the GDP by the middle of the 2010s. In order to 
achieve this target it has been implementing a plan to cut spending 
up to 14.3 trillion yen from fiscal 2007 through fiscal 2011. 
 
However, the estimate revealed this time indicates that if a 
temporary pause like this  continues, it would be necessary to 
further cut spending and boost revenues, by such means as a 
consumption tax hike, in order to achieve the target. The situation 
will likely affect discussions of the compilation of the fiscal 2009 
budget and an amendment to the tax code. 
 
The Cabinet Office will also extensively revise down its economic 
outlook. It is now undergoing coordination with the possibility of 
forecasting real growth of the GDP for fiscal 2008 at about 1.3 
PERCENT  and 0.3 PERCENT  in nominal terms, which are far below last 
year's projection -- 2.0 PERCENT  in real terms and 2.1 PERCENT  in 
nominal terms. 
 
The nominal growth rate continues to fall below the real growth rate 
mainly due to weak domestic demand. The government will unlikely 
achieve its goal of putting an end to deflation before fiscal 2009. 
 
13) Group of junior DPJ lawmakers prepares policy proposal for 
Ozawa, featuring int'l cooperation corps 
 
TOKYO SHIMBUN (Page 2) (Full) 
July 17, 2008 
 
Hideo Hiraoka, a House of Representatives member of the leading 
opposition Democratic Party of Japan (Minshuto) leads a 'liberal' 
group of middle-ranking and junior lawmakers reluctant to revise 
Article 9 of the Constitution. The group held a seminar yesterday in 
Chitose, Hokkaido, and worked out a policy proposal for "Japan as a 
thoughtful nation." 
 
The proposal features setting up an international cooperation corps 
 
TOKYO 00001978  008 OF 011 
 
 
as a new organization apart from the Self-Defense Forces to take 
over the SDF's role in international peace-keeping operations and 
humanitarian assistance activities overseas. It also advocates 
establishing a "peace law" stipulating that Japan will not 
participate in collective self-defense and that the SDF exists for 
defense only. 
 
"We want to present our policy proposal to President Ozawa," Hiraoka 
told a news conference, adding: "If there are (other) people raising 
their hands to run in this September's election for our party's 
presidency, we will present out policy standpoint to them as well." 
With this, Hiraoka indicated that his group would see the response 
to their policy proposal and then decide what to do in the party 
presidential race. He did not clarify whether he himself would run 
or whether his group would put up a candidate. 
 
14) Junior pro-Constitution DPJ members give up fielding own 
candidate for presidential election 
 
SANKEI (Page 5) (Excerpts) 
July 17, 2008 
 
The Group of Liberals, composed of junior and mid-ranking Democratic 
Party of Japan (DPJ) members in favor of protecting the 
Constitution, compiled a set of policy proposals in a study meeting 
held at a Japanese inn in Chitose City, Hokkaido, yesterday. They 
decided not to field their own candidate but to back a candidate who 
supports their policy proposals in the party presidential election 
in September. The group will soon submit the report to President 
Ichiro Ozawa. This decision has made it more likely for Ozawa to win 
a third term in power in the party without a formal vote. 
 
Hideo Hiraoka, who is the leader of the group and is said to be 
eager to run in the presidential race, revealed in a press 
conference after the study meeting that the group would give up 
putting up its own candidates, including him. He said: 
 
"It is undesirable to see the party split after the presidential 
election. We are fully aware of calls growing for the party to 
engage in a campaign for the next Lower House election under Mr. 
Ozawa. We would like to discuss matters based on this assumption." 
 
He also indicated that he would approve an election of Ozawa for a 
third term without voting, saying: "Although it is desirable that 
policy debate is conducted in the election campaign, since it is 
unknown when the next general election is held, it might be 
necessary for the party to be united in a different way from 
conducting heated debate." 
 
Some group members were reacting to Ozawa's possible election for a 
third term without a vote, one claiming: "If Ozawa became prime 
minister, he could manage the government in a Liberal Democratic 
Party's style. If liberal policy measures are not introduced, a 
change of government will be meaningless." Another member was 
insisting: "If a presidential election is carried out, the presence 
of the party will be played up." 
 
15) DPJ to make revision to postal privatization campaign pledge: 
Reaches agreement with PNP, Zentoku on election 
 
YOMIURI (Page 4) (Full) 
July 17, 2008 
 
TOKYO 00001978  009 OF 011 
 
 
 
Democratic Party of Japan (DPJ or Minshuto) President Ozawa and 
People's New Party (PNP) President Watanuki on July 16 held a 
meeting with the attendance of Chairman Urano of the national 
special postmasters association (Zentoku, former national 
association of special postmasters). They exchanged a consensus 
document noting that the DPJ will incorporate a proposal for 
drastically revising the postal privatization in its manifesto for 
the next Lower House election. The Postal Policy Study Group (PPSG), 
a political organization consisting of special postmasters, retired 
postmasters and their family members, will support PNP-recommended 
candidates running in the next election on the DPJ ticket, based on 
this agreement. 
 
The agreement noted that the DPJ pledges to give full consideration 
to the stance of the PNP regarding a drastic revision to the postal 
privatization and realize the revision without fail once it takes 
the reins of government, by mentioning it in its election pledges. 
Regarding specific revisions, the participants agreed to give teeth 
to revisions, based on talks between the PNP and the PPSG. 
 
Ozawa during the meeting asked the other participants, "I would like 
to have your cooperation (for the next Lower House election), as we 
need to assume power in order to fulfill what has been agreed on." 
Watanuki replied, "Power shift is needed in order to protect local 
communities and Japan." 
 
Postmasters can engage in political activities now that postal 
services have been privatized. 
 
16) LDP Yosano, DPJ Maehara remarkably close recently 
 
YOMIURI (Page 4) (Full) 
July 17, 2008 
 
Former Chief Cabinet Secretary Kaoru Yosano of the Liberal 
Democratic Party (LDP) and Vice President Seiji Maehara of the 
Democratic Party of Japan (DPJ) attended a forum sponsored by the 
Tokyo Foundation in Tokyo yesterday. 
 
A dialogue between Yosano and Maehara was published in the July 
edition of the monthly magazine Chuo Koron. The two also jointly 
attended a symposium on July 9. Their close ties have been drawing 
attention recently. A DPJ member was overheard saying: "Mr. Maehara 
is excessively close to the LDP." 
 
Yosano has recently criticized the DPJ's policy manifesto as 
"ridiculous" and "focusing on throwing money around." Yesterday, 
however, he underscored his consideration to Maehara yesterday, 
saying: "I do not use rude words before Mr. Maehara," though he 
commented: "(The manifesto) is financially inconsistent." Meanwhile, 
Maehara protected the DPJ's manifesto, saying: "We worked out it on 
the premise of the party assuming power at least for three years 
after a change of government. Our financial measures include those 
that will be able to be dealt with in three years time, but they are 
not slipshod." 
 
17) With prime minister silent, LDP working to prepare for cabinet 
shuffle, with each faction readying list of recommended candidates 
 
NIKKEI (Page 2) (Excerpt) 
July 17, 2008 
 
TOKYO 00001978  010 OF 011 
 
 
 
The growing outlook in the Liberal Democratic Party (LDP) is that 
Prime Minister Fukuda in late July at the earliest will shuffle his 
cabinet, and moves in the party have begun to actively push certain 
candidates. Each faction has begun to draw up a list of recommended 
candidates, and senior faction members are informally investigating 
the candidates. The Prime Minister, who started his vacation on the 
16th, has avoided contact with the party side, and remains hold up 
in his residence, maintaining his silence about whether or not he 
will shuffle the cabinet or not. 
 
18) Tanigaki celebrates 25th anniversary as a Diet member; Challenge 
is to demonstrate his political presence 
 
MAINICHI (Page 5) (Abridged) 
July 17, 2008 
 
Liberal Democratic Party (LDP) Policy Research Council Chairman 
Sadakazu Tanigaki celebrated his 25th anniversary July 16 as a 
politician with a party held at a Tokyo hotel. The late Prime 
Minister Kiichi Miyazawa had high hopes for his future, and when the 
Koga faction of the party and the Tanigaki faction, both of which 
came from the former Miyazawa faction, merged in May, Tanigaki was 
appointed to the second spot in the new faction. However, although 
he secretly is burning with desire to run in the next LDP 
presidential race, his challenge is that he must remove the image 
that his political presence in the party is weak. 
 
The party was attended by approximately 30 lawmakers, and LDP 
Election Committee Chairman Makoto Koga gave words of encouragement 
in a speech. It has been about two years since the last party 
presidential election in 2006. Can Tanigaki display leadership in 
such critical policy areas as turning road-tax revenues into general 
funds? He will soon reach a defining moment in his career. 
 
19) Ibuki ends debate about consumption tax hike, saying: 
"Deflecting voters' attention is needed to win election" 
 
SANKEI (Page 5) (Full) 
July 17, 2008 
 
Liberal Democratic Party's Secretary General Bunmei Ibuki said in a 
speech in Kyoto yesterday: "A hike in the consumption tax before a 
general election will cause us serious trouble," indicating that 
talk about the consumption tax should not be raised before the 
election. 
 
He also said: "To win a victory (in the election), we will have to 
deflect (voters') attention from the issue." Criticism might crop up 
against the remark implying that the government should come up with 
a policy that would delay a hike in the consumption tax and have the 
voters look away from this issue. Ibuki further said of an election 
strategy: "We would like to cope with a difficult situation while 
asking the prime minister for a dazzler, in a good sense, and a 
performance." 
 
Upon saying: "In public surveys, about half of the public said they 
support a consumption tax increase aimed to finance social security 
spending," Ibuki expressed his view that he cannot believe the 
survey result at face value. 
 
20) Attention now on how Chief Cabinet Secretary Machimura will be 
 
TOKYO 00001978  011 OF 011 
 
 
treated in cabinet shuffle 
 
TOKYO SHIMBUN (Page 2) (Full) 
July 17, 2008 
 
Since Prime Minister Yasuo Fukuda started his summer vacation 
yesterday, Chief Cabinet Secretary Nobutaka Machimura, Fukuda's 
chief aide, was busy yesterday with managing the Prime Minister's 
Official Residence (Kantei). As calls rise in the ruling parties for 
Fukuda to shuffle his cabinet, how Machimura will be treated is now 
drawing widespread attention in the ruling coalition. 
 
Referring to the scandal involving the Oita Prefecture board of 
education, Machimura, a former education minister, stated at a press 
conference yesterday: "Improving the quality of teachers is an old 
but new issue." 
 
Ruling camp members appreciate Machimura's capabilities as a person 
who is well versed in a wide range of policies from foreign affairs 
to tax and fiscal areas. Despite that, ruling coalition members are 
paying close attention to how he will be treated because many 
believe that he is unable to communicate with Fukuda, even though he 
is in a key position supporting the prime minister. 
 
Machimura's remarks in May about the need for a review of the 
government's reduced-rice-acreage policy encountered a barrage of 
objections in his Liberal Democratic Party (LDP). However, since he 
has made no major mistakes in his duties, there are two views in the 
ruling bloc -- one being that he would be removed in a shuffle and 
the other being that he would be retained in his current post. 
 
Another reason for the strong interest in the treatment of Machimura 
is speculation that if he is removed from the cabinet, the rivalry 
between former Secretary General Hidenao Nakagawa and Machimura will 
emerge in the Machimura faction, the largest in the LDP, over who 
will lead the faction. 
 
Machimura is a political highbred. His father served as Hokkaido 
governor and in both Diet houses. Since he was first elected to the 
Diet in 1983, he has climbed the political career ladder smoothly. 
He strongly hoped to assume the chief cabinet secretary post, with 
the aim of becoming a prime ministerial candidate in the future. But 
he is now facing a career challenge this summer. 
 
ZUMWALT