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FM AMEMBASSY TOKYO
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RUEHUL/AMEMBASSY SEOUL 2411
RUCNDT/USMISSION USUN NEW YORK 2573

UNCLAS SECTION 01 OF 09 TOKYO 003166 
 
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 11/18/08 
 
Index: 
 
1) Japan's economy in recession: Government expects zero GDP growth 
this fiscal year, greatly revising downward earlier forecast 
(Mainichi) 
 
Political agenda: 
2) Prime Minister Aso returns in high spirits from G-20 summit to 
find economy sinking deeper into recession and no means to counter 
it  (Tokyo Shimbun) 
3) With polls plummeting, the economy in recession, ruling Liberal 
Democratic Party moving away from early Diet dissolution to a spring 
or later scenario  (Yomiuri) 
4) Extension of Diet now seems inevitable, as Ozawa-driven 
Democratic Party of Japan (DPJ) breaks agreement to allow 
anti-terror bill to pass on time  (Asahi) 
5) Aso finds himself further in the lurch as own party begins to 
criticize his handling of Diet affairs, centered on the second 
supplementary budget  (Mainichi) 
6) DPJ suddenly switches to attack mode in the Diet  (Mainichi) 
7) Other opposition parties criticize DPJ head Ozawa for shifting 
Diet tactics suddenly  (Nikkei) 
8) Ozawa in meeting with Aso yesterday allegedly said he would 
resign his Diet seat if the second supplementary budget was not 
introduced  (Yomiuri) 
 
Defense and security affairs: 
9) Maritime Self-Defense Force trains with Navy carrier George 
Washington in southern waters  (Asahi) 
10) Despite government ban order, then ASDF chief Tamogami last 
month allowed jet-mountable cluster bombs to be displayed in parade 
(Tokyo Shimbun) 
11) Iraqi government in negotiation SOFA with the U.S. used 
U.S.-Japan SOFA as a model  (Asahi) 
 
12) Japan slips to 98th place in world ranking of gender equality 
(Asahi) 
 
Articles: 
 
1) Zero growth for fiscal 2008: Government likely to make 
substantial downward revision 
 
MAINICHI (Page 1) (Full) 
November 18, 2008 
 
The government on November 17 started looking into the possibility 
of making a substantial downward revision to its projection for 
economic growth for fiscal 2008. This is because it is now unlikely 
for the economy to achieve the growth rate estimate projected in 
July (1.3 PERCENT  in real terms, 0.3 PERCENT  in nominal terms) 
with gross domestic product (GDP) for the July-September quarter, 
released the same day, marking a second consecutive quarterly 
contraction for the first time in seven years. The government will 
formally revise the projection in its economic outlook to be 
compiled in December. The likelihood is strong that since both 
domestic and foreign demands have further cooled, following the 
worsening global economy due to the escalation of the financial 
crisis originating in the U.S., real growth for fiscal 2008 will be 
revised to almost zero. 
 
A further decline in the global economy, mainly in the U.S. and 
 
TOKYO 00003166  002 OF 009 
 
 
Europe, is expected in 2009. There is a strong possibility of the 
government making a downward revision to the outlook for the 
Japanese economy for fiscal 2009 from 1.6 PERCENT , projected in 
July, to the 0 PERCENT  level. 
 
In connection with the GDP figures released on the 17th, a senior 
Cabinet Office official explained, "Since the economic climate has 
changed since, it is imperative to make a downward revision to a 
growth outlook for fiscal 2008." The Bank of Japan in its Outlook 
Report has made a significant downward revision to its outlook for 
the Japanese economy's real growth from the mid-1 PERCENT  level to 
0.1 PERCENT  for fiscal 2008 and to 0.6 PERCENT  for fiscal 2009. 
The government is expected to follow suit with a revision in 
December. The substantial downward revision to the government 
outlook for economic growth is bound to put a dent in the state's 
tax revenues. 
 
The likelihood is that unless the economy fully recovers, the 
government's goal of moving the primary balance into the black by 
fiscal 2011 will become unachievable. 
 
2) Economic recovery nowhere in sight 
 
TOKYO SHIMBUN (Page 2) (Full) 
November 18, 2008 
 
Prime Minister Taro Aso during the recent emergency summit meeting 
(financial summit) sent a message on "Aso for the economy" to the 
world. However, as if to dampen his buoyant mood at the summit, the 
nation's gross domestic product released by the Cabinet Office on 
November 17 turned out to be in negative territory. The government 
was forced to declare that the economy has taken a downward turn. 
The prime minister, who gives top priority to economic recovery, 
will continue to face challenges in managing his administration. 
 
Commenting on the financial summit, Chief Cabinet Secretary Takeo 
Kawamura proudly said, "Japan has set a direction that will go down 
in history. It is significant that momentum to address the current 
financial crisis is surging. The prime minister has displayed his 
presence to the fullest extent." 
 
Aides to the prime minister hoped his success at the summit would 
lead to a rise in cabinet support ratings. However, when he returned 
home, the prime minister faced the government announcement that the 
economy has taken a downward turn. Commenting on the GDP marking 
negative growth for two consecutive quarters, Kawamura said, "The 
future of the economy will be even harsher. We must pay attention to 
the risks that will pose." 
 
The prime minister is determined to do his utmost to put the economy 
on a recovery track through expanded domestic demand. However, it is 
not an easy job. The government has adopted a package of economic 
stimulus measures worth 11.7 trillion yen in late August and an 
additional package worth 26.9 trillion yen in late October. However, 
whether they will help shore up the economy is unclear. 
 
The government and ruling parties fell into confusion over measures 
incorporated in the package, including an income restriction for a 
flat-sum cash benefit plan and the transfer of 1 trillion yen drawn 
from the freed up special road-construction funds to local 
governments. It remains unclear whether will be a second 
supplementary budget, which is designed to finance the packages, 
 
TOKYO 00003166  003 OF 009 
 
 
submitted to this Diet session. 
 
When he took office, the prime minister said, "It will take three 
years for the economy to fully recover." Now that he has decided to 
put off a Lower House dissolution, the prime minister will face the 
test of achieving concrete results from the economic stimulus 
package. There is not much time left for "Aso for the economy." 
 
3) Cabinet support ratings falling: Economy shows downturn: LDP 
mulling Lower House dissolution next spring or later 
 
YOMIURI (Page 3) (Full) 
November 18, 2008 
 
Although the Democratic Party of Japan (DPJ) is calling for an early 
Lower House dissolution, the government and the ruling camp are 
showing no indications of responding to its demand. 
 
Prime Minister Aso during his stay in Washington on November 14-15 
hinted to reporters that he planned to give top priority to passage 
of the fiscal 2009 budget within the current fiscal year and then 
would dissolve the Lower House next spring or later. An increasing 
number of Liberal Democratic Party (LDP) lawmakers now favor this 
timetable. Referring to Lower House dissolution, Secretary General 
Hosoda in a speech given on the 17th in Nagoya City underscored: "In 
my view, given the current economic situation, Lower House 
dissolution will not take place before next spring. It is logical to 
consider the timing when Diet affairs are settled for the time, 
beginning with passage of the fiscal 2009 budget bill." 
 
The economy has taken a downward turn. Cabinet support ratings are 
continuing to plummet. 
 
Under such circumstances, there is strong skepticism in the LDP 
regarding whether it has a chance to win, if a Lower House election 
were held now. Concerning DPJ President Ozawa's latest (hard-line) 
tactic, some lawmakers take the view that they must not respond to 
his provocative approach, because if the DPJ tries to aggressively 
control the Diet, public criticism will be directed at it. However, 
it is also true that dissatisfaction with the prime minister is 
lingering in the LDP, because his sole attention is to the economy, 
the future prospects of which remain unclear. 
 
The stance of the New Komeito, which is only worried about the Tokyo 
Metropolitan Assembly election next summer, is that it is desirable 
to set a date for a Lower House election that allows a certain time 
interval from that event. Concerning the timing for the Lower House 
election, one senior LDP official on the 17th noted, "There will not 
be a double election of the Tokyo Metropolitan Assembly election and 
the Lower House election." 
 
4) Diet extension inevitable; DPJ to renege on agreement to take 
vote 
 
ASAHI (Top play) (Excerpts) 
November 18, 2008 
 
Democratic Party of Japan President Ichiro Ozawa held talks with 
Prime Minister Taro Aso (president of the Liberal Democratic Party) 
at the Prime Minister's Office last night and sought the 
presentation of a second supplementary budget to the Diet in the 
current session. In response to Aso's unwillingness to give a clear 
 
TOKYO 00003166  004 OF 009 
 
 
answer, the DPJ has adopted a policy course to scrap an agreement 
reached between the ruling and opposition camps to take a vote in 
the Upper House on a bill amending the refueling special measures 
law before the current Diet session ends on Nov. 30 and to put off 
an Upper House vote for the time being if the government fails to 
submit a second supplementary budget. Given the difficulty for bills 
amending the refueling special measures law and the Financial 
Function Strengthening Law to clear the Diet in the current session, 
an extension of the session now seems inevitable. Also linked to the 
timeframe for submitting a second supplementary budget, the session 
is likely to fall into confusion. 
 
The first Aso-Ozawa meeting took place for about half an hour at the 
request of the DPJ. 
 
In the meeting, Ozawa pressed Aso to present a second supplementary 
budget, saying: "You have not called a general election, saying that 
the economy is more important than the election. The current 
situation is strange in view of your logic." In response, the prime 
minister simply said: "We are in the middle of efforts to submit a 
budget. I cannot say anything more at this stage." 
 
In response to Aso's elusive answer about a second supplementary 
budget, the DPJ has decided to renege on its agreement to take a 
vote on the refueling legislation at the Upper House Foreign Affairs 
and Defense Committee on Nov. 18. DPJ Upper House Diet Affairs 
Committee Chairman Susumu Yanase conveyed the decision to his LDP 
counterpart Seiji Suzuki. In a press conference after the meeting, 
Ozawa explained: "This does not mean that we will boycott 
deliberations. We would like to deal with the situation by 
consulting with other opposition parties in the belief that 
deliberations must be carried out as necessary." 
 
The government and the ruling coalition have tried to coordinate 
views not to extend the session on the assumption that the bills 
amending the refueling legislation and the financial function 
strengthening law will get Diet approval in the current session. But 
witnessing the DPJ's shift to a hard-line stance yesterday, a person 
close to the prime minister said: "An extension of the refueling 
mission is an international pledge, and if the DPJ boycotts 
deliberations, the Diet session would have to be extended." 
Meanwhile, Aso said to reporters: "(Whether or not to extend the 
Diet session) would not be determined until the very end of the 
current session." Nevertheless, for getting important bills enacted, 
extending the session seems inevitable. 
 
Aso expressed wariness about the DPJ's possible attempt to prolong 
deliberations following the presentation of a second supplementary 
budget. But Ozawa emphatically said in the meeting: "I promise, 
taking responsibility as leader, to conduct deliberations from a 
commonsense standpoint and reach a conclusion in the Diet." After 
the meeting, Aso implied to reporters that the government might 
submit a second supplementary budget to the current session on the 
condition that the DPJ take a vote on it at an early date, saying: 
"It is one idea to get the supplementary budget (enacted) in the 
current session." 
 
The LDP is still alarmed, with one leader saying, "What Mr. Ozawa 
said does not ensure anything." But there has appeared a possibility 
to submit the budget to the current session, with a person close to 
Aso saying: "There is no reason not to present the budget." 
 
 
TOKYO 00003166  005 OF 009 
 
 
5) Prime minister in difficult position over whether to submit 
second extra budget in current Diet session 
 
MAINICHI (Page 2) (Excerpts) 
November 18, 2008 
 
In meeting with Democratic Party of Japan leader Ichiro Ozawa 
yesterday, Prime Minister Taro Aso stopped short of mentioning 
whether the government would submit in the current Diet session a 
second fiscal 2008 extraordinary budget bill that would include 
fiscal resources for additional economic stimulus measures. 
Coordination in the government ran into trouble over a fixed-amount 
cash handout program, a key element in the second extra budget. 
Given this, difficult deliberations on the program are expected. But 
if the government decides to delay the submission of the bill, 
questions might be raised about the government's pledge to give 
priority to boosting the economy. Under this situation, Aso has been 
under intense pressure to make a hard decision. 
 
In the party head talks, Ozawa insisted that the second 
supplementary budget bill be submitted during the current Diet 
session, but Aso responded to Ozawa with this question: "Will (the 
DPJ) agree to deliberate on the bill? Will the party agree to take a 
vote on the bill (at an early date)?" Ozawa replied: "Although we 
will not be able to support the bill, I responsively promise as the 
leader of the party to reach a conclusion in the Diet," but Aso just 
responded: "The government will quickly lay out (the bill)." 
 
When he visited Washington to attend the financial summit, Aso also 
indicated his eagerness to submit a second extra budget during the 
current Diet session, remarking: "I think it would be better to 
submit the bill as quickly as possible." In the ruling camp, 
however, the dominant view is that the bill should be submitted in 
the next ordinary Diet session in January, so the prime minister now 
finds it difficult to switch plans and submit the bill to the 
ongoing session. 
 
A senior New Komeito member who was briefed about the contents of 
the party head talks commented last night: "If the DPJ tries to 
prolong deliberations by means of all-out resistance, the second 
extra budget will also be affected." But some ruling party members 
point out the prime minister's lack of leadership as one of the main 
causes for the confusion over fixed-amount cash handouts. One member 
grumbled: "Even if the government submits a bill during the current 
Diet session, the bill will just be criticized by the opposition 
bloc. It would be better to make a fresh start." 
 
6) DPJ plunges into battle mood, set off by Aso's remark indicating 
delay of Lower House dissolution to spring or later 
 
MAINICHI (Page 2) (Excerpts) 
November 18, 2008 
 
In meeting with Prime Minister Taro Aso yesterday, Democratic Party 
of Japan (DPJ) President Ichiro Ozawa insisted that a second fiscal 
2008 supplementary budget bill should be submitted during the 
current Diet session. But Ozawa, complaining that Aso's reply was 
unsatisfactory, has begun to take a confrontational stance. When the 
DPJ was unable to find any effective means of attack with only two 
weeks left until the end of the ongoing session, the prime minister 
made a statement indicating a delay in the dissolution of the House 
of Representatives to the spring or later. The main opposition party 
 
TOKYO 00003166  006 OF 009 
 
 
jumped at this remark and took advantage of the "error" made by the 
other side only a few days before the planned vote on a bill 
amending the New Antiterrorism Special Measures Law to extend the 
Maritime Self-Defense Force's refueling mission in the Indian Ocean. 
But it is still uncertain whether the DPJ would be able to force the 
government to dissolve the Lower House at an early date. 
 
Ozawa told Aso during their talks yesterday: "You pledged to the 
people that priority will be given to economic growth over an 
election. You have yet to implement this pledge although only two 
weeks are left until the end of the current Diet session. That is 
beyond my comprehension." According to a participant, "Mr. Ozawa was 
speaking about 90 PERCENT  of the total amount of time used for the 
meeting." 
 
Many DPJ members had taken the current Diet session as "a throwaway 
match," seeing calls growing in the ruling camp for forgoing the 
submission of a second extra budget in the current session. On Nov. 
14, the DPJ accepted a request from the People's New Party and 
decided to present a plan to start deliberations on a bill reviewing 
postal privatization as the condition for voting on such key bills 
as the refueling bill. But a senior House of Councillors member 
said: "It is difficult to change the planned date of voting the bill 
on the 18th." 
 
Despite the circumstances, Ozawa stated in an executive meeting 
yesterday morning: "The prime minister said that he would not 
dissolve the Diet before April. I will ask him about that." This 
remark completely changed the atmosphere. A senior member of the 
Diet Affairs Committee said: "He might be aiming to urge the Aso 
government to submit a second extra budget bill by having it extend 
the current Diet session and then cause damage to the 
administration." 
 
7) JCP, SDP criticize Ozawa's response 
 
NIKKEI (Page 2) (Full) 
November 18, 2008 
 
Japanese Communist Party Head of the Secretariat Tadayoshi Ichida in 
a press conference yesterday criticized the fact that Democratic 
Party of Japan President Ichiro Ozawa in his talks earlier in the 
day with Prime Minister Taro Aso sought the presentation of a second 
supplementary budget to the current Diet session by linking it to a 
vote on a bill extending the refueling legislation. Ichida said: 
"(The refueling legislation and the second supplementary budget) are 
different in nature, so they must not be linked to each other in 
discussion." Social Democratic Party head Mizuho Fukushima, too, 
emphatically said to the press: "I cannot understand at all (Mr. 
Ozawa's decision) to suddenly reject deliberations because the 
government has not presented a second supplementary budget and to 
reverse the agreement to take a vote." 
 
8) Ozawa expressed willingness to give up his Diet seat? 
 
YOMIURI (Page 4) (Full) 
November 18, 2008 
 
There was a discrepancy yesterday in explanations between the ruling 
bloc and Democratic Party of Japan President Ichiro Ozawa on whether 
or not he had said, "I am willing to give up my Diet seat," over the 
handling of a second supplementary budget for fiscal 2008 in his 
 
TOKYO 00003166  007 OF 009 
 
 
talks with Prime Minister Taro Aso earlier in the day. 
 
A ruling party leader quoted Ozawa as telling Aso: "We would like to 
see the second supplementary budget presented to the current Diet 
session. Our party will cooperate in taking a vote on it. If this 
promise is broken, I will resign from the Diet." Another executive 
said: "Mr. Ozawa said, 'I will stake my political life on it,' and 
the prime minister asked, 'Are you sure?'" 
 
Ozawa in a press conference after the meeting flatly denied the LDP 
explanation, saying, "I didn't say such a thing." The truth is 
shrouded in thick fog. 
 
9) U.S. nuclear flattop conducts joint drill with MSDF 
 
ASAHI (Page 34) (Full) 
November 18, 2008 
 
The USS George Washington, a nuclear-powered U.S. aircraft carrier 
that arrived at the U.S. Navy's Yokosuka base in September, showed 
its aircraft's deck landing practice to the press yesterday. 
Carrier-borne fighter-attack planes were lined up on the deck, and 
they took off with a roar. The George Washington also received 
supplies from a supply ship running alongside. "The exercise this 
time will be a message to show that the United States will do its 
best to maintain stability in the West Pacific," said George 
Washington Carrier Strike Group Commander Richard Wren. 
 
The George Washington is now on a training mission with the Maritime 
Self-Defense Force in waters off the Nansei Shoto islands, including 
exercises for anti-aircraft and anti-submarine warfare and also for 
ballistic missile defense. This is the first time for the George 
Washington to conduct such full-fledged training exercises in the 
region since her deployment to the 7th Fleet. Participating in the 
training exercises are about 25 vessels and 50 planes from the MSDF 
and 14 vessels and about 70 planes from the U.S. Navy. 
 
10) ASDF exhibited cluster bomb in troop review; Tamogami in charge 
 
TOKYO SHIMBUN (Page 1) (Full) 
November 18, 2008 
 
Even though the government has decided to scrap Japan's cluster 
bombs, this paper has learned known that the Air Self-Defense Force 
had exhibited a cluster bomb in a review of its troops on Oct. 19, 
introducing it as a weapon that can be mounted on fighter planes. 
The person responsible for the review was former ASDF Chief of Staff 
Tamogami, who has been dismissed for his publication of an essay 
differing from the government's view regarding a war of aggression. 
Tamogami was opposed to prohibiting cluster munitions. Given this 
fact, the cluster bomb might have been intentionally put on 
display. 
 
The ASDF review was held at the ASDF's Hyakuri Base in Ibaraki 
Prefecture. There were about 7,000 people at the review, including 
guests from abroad. The event was held in the presence of Prime 
Minister Taro Aso, Defense Minister Yasukazu Hamada, and brass 
officers from the Self-Defense Forces. In addition to ASDF 
aircraft's flight demonstrations, ASDF planes and missiles were 
displayed. 
 
The cluster bomb in question has about 200 bomblets that can kill or 
 
TOKYO 00003166  008 OF 009 
 
 
injure enemy troops in an area that is three times larger than a 
soccer ground. It was displayed along with F-15 and F-2 fighter 
planes exhibited in a hangar. Its explanatory panel did not refer to 
the government's decision to scrap Japan's cluster bombs. 
 
The Defense Ministry has already earmarked a total of 7.5 billion 
yen in its budget request to study how to scrap the cluster bombs 
and to procure alternative weapons. However, the government had 
initially been opposed to banning the cluster munitions, taking the 
position that such weapons are necessary for the defense of Japan as 
a country with long coastlines. Especially, Tamogami insisted, 
"Unexploded bombs could also damage (Japanese) people, but damage 
from being occupied is far more serious." 
 
The ASDF's public relations office commented: "It was on display in 
the last review (three years ago), so we just showed it. There was 
no particular intent. There was no order from Chief of Staff 
Tamogami, either." 
 
11) Iraq tenacious in negotiating with U.S. on security accord; SOFA 
also studied 
 
ASAHI (Page 8) (Full) 
November 18, 2008 
 
Iraq negotiated with the United States for a security agreement 
after studying the Japan-U.S. Status of Forces Agreement (SOFA). 
 
In early June, Iraqi Deputy Foreign Minister Hammoud visited Japan 
for five days. According to Japanese government officials, Hammoud 
asked for detailed explanations about the SOFA's history and 
implementation and showed interest particularly in criminal trial 
procedures. 
 
How to handle U.S. soldiers has been a matter of major concern in 
Japan as well. Under the SOFA, Japan has primary jurisdiction over 
off-duty crimes. However, the United States is to judge whether such 
crimes were committed off duty. Municipalities saddled with U.S. 
military bases are therefore greatly dissatisfied. 
 
In particular, the problem is the case where the U.S. military 
detained U.S. military suspects over off-duty incidents or 
accidents. The SOFA stipulates that the U.S. military will detain 
them until they are indicted. 
 
In 1995, a schoolgirl rape that occurred in Okinawa Prefecture 
enraged local people. In its aftermath, the Japanese and U.S. 
governments concurred on improving the SOFA's implementation. The 
United States then agreed to show "sympathetic consideration" for 
Japanese investigative authorities' requests to hand over U.S. 
military suspects in serious crimes, such as rape and murder, before 
they are indicted. In 2004, Japan agreed to allow the presence of 
those connected to the U.S. military when local police question U.S. 
military suspects. Instead, Japan will request the U.S. military to 
turn over U.S. military suspects in all criminal cases that 
seriously concern Japan. The Iraqi vice minister was surprised to 
hear the situation in Japan, saying Japan and the United States are 
so advanced. 
 
12) Japan slips to 98th place in gender quality ranking 
 
ASAHI (Page 2) (Slightly abridged) 
 
TOKYO 00003166  009 OF 009 
 
 
November 18, 2008 
 
(Shigeo Tosa, London) 
 
The World Economic Forum, based in Geneva, has announced the latest 
global gender gap report covering 130 countries. While Scandinavian 
countries held the top positions, Japan's place dropped from 91 in 
the previous year to 98. The slip is attributed to the number of 
female lawmakers and the gender gap in terms of promotions. 
 
The survey was conducted by creating indices in the political, 
economic, education, and health areas. Japan did well in health, as 
it came out on top as to the average life span. But Japan ranked 
107th in the political area and 102nd in the economic area. 
 
Norway, Finland, and Sweden held the top three places for three 
years in a row. China rose from 73rd to 57th. 
 
SCHIEFFER