Cablegate: Japanese Morning Press Highlights 12/12/07

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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 12/12/07

Index:

1) Top headlines
2) Editorials
3) Prime Minister's daily schedule (Nikkei)

Political agenda:
4) Fukuda, Ota as heads of LDP, New Komeito confirm decision to
override the Upper House's rejection of the antiterrorism bill and
enact it this Diet session (Mainichi)
5) DPJ unlikely to submit a counterproposal to the ruling camp's
antiterrorism bill, preferring to give priority to pursuing defense
scandals (Tokyo Shimbun)
6) DPJ study group preparing a censure motion against the prime
minister (Tokyo Shimbun)
7) DPJ sets fiscal 2008 policy goal of winning control of the Lower
House in the next general election (Yomiuri)
8) Health, Labor and Welfare Ministry's admission of inability to
resolve the pension mess a big loss of public confidence for the
Fukuda administration (Tokyo Shimbun)
9) Opposition camp may file a censure motion against Health and
Labor Minister Masuzoe for inability to keep public commitment to
fix the pension mess (Nikkei)
10) LDP election strategy is leaving "Koizumi's children" - freshmen
lawmakers - out in the cold (Yomiuri)

11) China will not respond to Japan's protest by reinstating omitted
words in joint economic communiqu (Asahi)

Defense issues:
12) Okinawa prefecture finds central government's assessment method
report for Futenma site "insufficient" (Asahi)
13) Troubled Defense Ministry cuts allocations sharply for upgrading
the F15s (Sankei)

Articles:

1) TOP HEADLINES

Asahi:
Medical fees to be raised for first time in 8 years

Mainichi:
Ruling coalition confirms passing new antiterrorism bill by
two-thirds Lower House overriding vote

Yomiuri & Akahata
Welfare minister admits government abandons pledge on pension
records

Nikkei:
Honda to construct engine factory in China

Sankei:
Medvedev expresses desire to see Putin to become prime minister

Tokyo Shimbun:
Ex-Paloma executives charged over gas death, injury

2) EDITORIALS

Asahi:

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(1) Extension of Diet session over refueling bill: Government must
consider starting from scratch
(2) What happened to party head debate in the Diet?

Mainichi:
(1) Government's abandonment of pledge on pension records
impermissible
(2) Putin expected to retain influence

Yomiuri:
(1) Pension record blunders: Is there other means for people than
protecting pension rights themselves?
(2) Putin paves way to pull the strings by supporting Medvedev as
successor

Nikkei:
(1) Full-scale, rational local tax reform desired
(2) Likely Russian presidential candidate expected to continue
"Putin policy"

Sankei:
(1) DPJ must face thorough Diet deliberations, without adopting
boycotting strategy
(2) China's alternation of diplomatic document exposes its
problematic predisposition

Tokyo Shimbun:
(1) Fully discuss issues besides refueling bill if Diet session is
re-extended
(2) Putin's support for Medvedev as successor contains danger

Akahata:
(1) Improper judgment by Tokyo High Court in case of distributing
JCP leaflets

3) Prime Minister's Official Residence (Kantei)

Prime Minister's schedule, December 11

NIKKEI (Page 2) (Full)
December 12, 2007

07:56
Attended an emergency meeting of relevant cabinet ministers on small
businesses suffering form rising oil prices.

08:31
Attended a cabinet meeting. Land and Transport Minister Fuyushiba
stayed on. Afterward met Chief Cabinet Secretary Machimura.

09:28
Met Tokyo Governor Ishihara at the Kantei.

10:00
Met Deputy Chief Cabinet Secretary Ono, followed by Science Council
of Japan Chairman Ichiro Kanazawa and Economic, Fiscal Policy
Minister Ota.

12:24
Met Machimura.

14:38

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Met Internal Affairs and Communications Ministry Administrative
Management Bureau Director General Muraki, followed by International
Criminal Court judge-elect Saiga. Afterward met actor Ryotaro Sugi
and Lower House member Okiharu Yasuoka.

15:47
Met LDP Consumer Affairs Research Commission Chairperson Seiko Noda
and others, followed by Fuyushiba, Education Minister Tokai and
others. Fuyushiba and other stayed on.

16:50
Met LDP Comprehensive Agricultural Administration Research
Commission Chairman Hori, former LDP Secretary General Kato and
others. Afterward met Machimura.

19:32
Met New Komeito Representative Ota at the Kantei.

22:07
Returned to his residence in Nozawa.

4) LDP, New Komeito heads confirm plan to extend Diet session until
January to allow Lower House to readopt new antiterrorism bill

MAINICHI (Top) (Full)
December 12, 2007

Prime Minister Yasuo Fukuda (who is also LDP president) had a
meeting with New Komeito Representative Akihiro Ota at the Prime
Minister's Official Residence (Kantei) last night. The two leaders
agreed to enact the new antiterrorism bill during the current Diet
session. They also confirmed a plan to re-extend the Diet session,
due to end on Dec. 15, until mid-January and to use a two-third
House of Representatives override vote to pass the bill in the event
the House of Councillors votes it down or the chamber fails to take
final action within 60 days after receipt of the bill from the Lower
House. The prime minister seems to have conveyed a cautious view to
Ota about the New Komeito's concern over early Lower House
dissolution for a snap general election.

The one-on-one meeting lasted for two hours over dinner.

Fukuda indicated that he would seek the understanding of opposition
parties are opposed to re-extending the Diet session through ruling
party executives. Ota said that the ruling bloc should continue
urging the major opposition Democratic Party of Japan (DPJ or
Minshuto) to vote on the bill before year's end even if the Diet
session is to be re-extended until January.

After the meeting, Ota, while denying discussion on Lower House
dissolution, said to reporters: "The prime minister is well aware
that I have been saying that (Lower House dissolution) should wait
until next fall or later."

The government and ruling camp extended the Diet session, which was
originally scheduled to close on Nov. 10, by 35 days. Although the
antiterrorism bill cleared the Lower House on Nov. 13, a
question-and-answer session in the opposition-controlled Upper House
slipped to Dec. 4. The opposition bloc is demanding 41 hours of
deliberation time on par with the Lower House. Total deliberation
time in the upper chamber is expected to be about 17 hours, however.
The enactment of the bill requires a lengthy extension of the Diet

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session.

The Diet Law specifies the "dominance of the Lower House" in the
event decisions on a Diet extension are split between the two
chambers or the upper chamber fails to take a vote. The government
and ruling parties are expected to decide on a re-extension on Dec.
14.

5) DPJ cautious about presenting its own bill to Diet in response to
new refueling bill, putting high priority on MOD scandals

TOKYO SHIMBUN (Page 2) (Full)
December 12, 2007

The foreign affairs and defense committee of the major opposition
Democratic Party of Japan (DPJ or Minshuto) yesterday finalized the
outline of its bill titled "The Special Measures Law on
Reconstruction Assistance to Afghanistan," an alternative to the
government's new antiterrorism special measures bill. The DPJ,
however, is unlikely to submit the outline as a bill to the current
Diet session. The party's decision not to turn the outline into a
bill is hard to understand.

According to the outline, the envisaged bill is for time-limited
legislation valid only for one year. Self-Defense Forces personnel
will provide people assistance with medical care, food, and everyday
goods after a ceasefire is reached in Afghanistan.

SDF activities will be based on UN Security Council Resolution 1386
on the establishment of the International Security Assistance Force
(ISAF). The party's outline in November did not refer to any UN
resolution. This drew criticism of a gap with President Ichiro
Ozawa's standpoint that the overseas dispatch of the SDF should be
limited to peace-building activities authorized by a UN resolution.
The new outline apparently puts high priority on consistency.

Ozawa said in a press conference yesterday: "We have yet to decide
on whether to turn (the outline) into a bill." A senior DPJ lawmaker
explicitly said, "We will not submit (a bill) to the Diet in the
current session."

This policy is in line with the DPJ's Diet strategy. The DPJ
prioritizes the series of scandals involving the Ministry of Defense
(MOD) over deliberations on the new antiterrorism bill. The party is
trying to forgo presenting its own counterproposal, judging that if
an alternative bill is presented, discussion would focus on
differences with the new alternative bill and it would proceed at a
pace of the ruling bloc.

Now that the outline has been produced, the ruling camp is likely to
push the DPJ to produce its own bill. Discontent is also growing in
the DPJ, with a mid-level member saying, "We should present a bill
to the Diet to let people know what the DPJ will do."

6) DPJ holds study meeting to plan censure of premier

TOKYO SHIMBUN (Page 2) (Full)
December 12, 2007

The leading opposition Democratic Party of Japan (Minshuto) held a
study meeting yesterday in the Diet to arm itself theoretically in
preparation for submitting a censure motion against Prime Minister

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Fukuda to the opposition-dominated House of Councillors after the
ruling coalition of the Liberal Democratic Party and New Komeito
revotes on a new antiterror bill in the House of Representatives and
overrides the upper chamber's decision.

"Second-time passage is based on the Constitution," One of the
ruling coalition's lawmakers said. "But," this lawmaker added, "the
Constitution does not stipulate a censure motion, so we can ignore
it." The DPJ held the study meeting to rebut this position of the
ruling coalition.

The study meeting was held with DPJ Vice President Naoto Kan, DPJ
Secretary General Yukio Hatoyama, and other party executives

SIPDIS
attending. The Constitution, in its Article 66, stipulates that the
cabinet shall be collectively responsible to the Diet. Citing this
provision, Yoshiharu Asano, a professor at Daito Bunka University,
explained that the House of Councillors, as well as the House of
Representatives, can censure the prime minister, who heads the
cabinet.

Within the DPJ, however, there are also arguments negative about
submitting a censure motion. "In the end, we will make a decision
based on political judgment," one of the party's executive officers
told reporters after the study meeting.

7) DPJ in action plan for fiscal 2008 aims to take helm of
government in next Lower House election

YOMIURI (Page 2) (Slightly abridged)
December 12, 2007

The Democratic Party of Japan (DPJ or Minshuto) revealed yesterday
its action plan for fiscal 2008. According to the plan, the DPJ will
make an all-out effort to force an early dissolution of the House of
Representatives so that a general election will be called. The
action plan also calls on party members to unite so that a DPJ-led
government will be able to be formed. The DPJ takes a clear a stance
of aiming at a change of government in the next Lower House
election. The party will adopt the action plan in its convention on
Jan. 16.

The action plan points out that under the present political
situation, in which the opposition camp controls the Upper House and
the ruling bloc dominates the Lower House, the cabinet of Prime
Minister Yasuo Fukuda appears to have reached a dead end. Looking
objectively at the circumstances, the party sees no other choice for
the prime minister but to dissolve the Lower House and call a snap
election.

The DPJ intends to complete as early as possible the selection of
candidates who can win in the election. The party aims to win more
than 150 seats in the 300 single-seat districts. The party also aims
to gain more supporters in urban areas, increasing the base of
support that boosted it in the recent House of Councillors election.
The action plan also notes that the party will hold a fund-raising
party next summer.

The action plan advocates the need for strengthening cooperation
with Rengo (Japan Trade Unions Confederation) in order to narrow
socioeconomic disparities in the country. It also includes the
target of boosting party membership and supporters from the present
200,000 to 250,000.

TOKYO 00005520 006 OF 010

8) Government reneges on public commitment to identify to very last
pension account holders: Mistrust in administration likely to grow;
"The result would have been the same, even if another person had
been in charge"

TOKYO SHIMBUN (Page 2) (Full)
December 12, 2007

Labor, Health and Welfare Minister Yoichi Masuzoe yesterday revealed
that efforts to identify holders of about 40 PERCENT or 19.75
million public pension accounts out of approximately 50 million
premium payment records have bogged down. Then Prime Minister Shinzo
Abe during the Upper House election campaign last summer repeatedly
said, "The government will pay every last yen to the very last
person." But now, the ministry finds it unavoidable to renege on
that pledge. Public mistrust in the administration is bound to
heighten.

According to the findings of the investigation, of the 19.75 million
public pension accounts or about 38.8 PERCENT of the some 50
million accounts that remain unidentified, there are 9.45 million
accounts that have been categorized as unidentifiable, even if
computerized records are compared with the original paperwork due to
erroneous input of data into the (Social Insurance Agency's = SIA)
online system.

Holders of only 11 million accounts have been identified. Accounts
that are undergoing the correction of holders' names reached 4.7
million or 9.2 PERCENT . Cases that cannot lead to new benefit
payments, such as holders who are believed to have died, came to
15.5 million or 30.4 PERCENT .

Masuzoe frowned on the unexpected results, noting, "To be honest, I
never imagined that the situation was as bad as this."

The government and the ruling camp decided to complete the matching
procedure on 50 million accounts by next March. In response, the SIA
has developed a computer program to trace pension premium payment
records using registered name, date of birth and gender. The
computer-based matching procedure supposedly made progress in one
sweep from December, once the computer-based procedures start
operating.

However, according to the findings of the investigation revealed
yesterday, it was found that there were too many sloppy records,
including incorrect names having been recorded, revealing that the
computer-based matching procedure is not making progress as
expected.

Chief Cabinet Secretary Nobutaka Machimura said, "What the
government will complete by next March is the computer-based
matching procedure and notifying pension beneficiaries of new
findings." He underscored, "There is no problem about the
identification work itself." However, it would be unavoidable for
the government to come in for public criticism as failing to keep
the pledge, if a large number of premium payment records remain
unidentified.

It is also necessary to verify 9.45 million accounts that were
erroneously input into the computer system, by comparing them with
the original paper work. However, there is no means of tracing a

TOKYO 00005520 007 OF 010

considerable number of records due to the loss of the original paper
documents by the SIA or illegible data because of a poor state of
preservation.

Masuzoe has already withdrawn the government pledge for a complete
settlement of the pension fiasco, saying, "The identification
procedure is endless. There are accounts whose holders cannot be
identified." He has already made a remark that can be taken as a
defiant attitude. He said, "I would feel responsible if the
verification work failed because I am the minister in charge, and if
other person were in charge, it would have been possible. However,
the results would have been the same, even if another person had
been in charge."

9) Government, ruling camp desperately trying to cap criticism that
commitment has been broken

NIKKEI (Page 3) (Slightly abridged)
December 12, 2007

Chief Cabinet Secretary Nobutaka Machimura yesterday stated: "We did
not say we would complete the identification process - down to the
last person and last yen -- by the end of March, but used simplified
expressions during the election campaign, saying 'Everything within
the current fiscal year'."

According to the government's official position, the government has
pledged to complete by March next year two points regarding about 50
million pension accounts: (1) to identify the computer-based records
of pension account holders and (2) to notify those account holders
by mail. The government's position is that it has not pledged to
complete the entire process by the end of March.

Former Prime Minister Shinzo Abe, however, clearly stated during the
July House of Councillors election: "The government pledges to check
pension accounts until the last person is identified and pay the
money." Health, Labor and Welfare Minister Yoichi Masuzoe also has
repeatedly made similar statements, not changing his stance since
the inauguration of the cabinet of Prime Minister Yasuo Fukuda. This
gave the impression that the government has pledged to resolve the
pension issue by the end of March.

Opposition parties intend to pursue the government's responsibility
in a thoroughgoing manner with an eye on a censure motion against
Masuzoe. The opposition camp is enthusiastic about taking advantage
of the pension issue, which gave the opposition a big win in the
July Upper House election.

Democratic Party of Japan (DPJ or Minshuto) President Ichiro Ozawa
stressed in a press conference yesterday: "The government violated
its commitment, and its responsibility is significant." He also
criticized Machimura's statement, saying: "It is a sacrilege against
the public and an irresponsible remark." Ozawa ordered DPJ policy
chief Masayuki Naoshima and Akira Nagatsuma, who is in charge of the
pension issues, to do their best in dealing with the matter.

10) LDP to give no favorable treatment to proportional
representation candidates in next Lower House election; "Koizumi's
children" unhappy with the party's decision

YOMIURI (Page 4) (Excerpts)
December 12, 2007

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The ruling Liberal Democratic Party (LDP) held a meeting yesterday
of its Election Committee, chaired by Makoto Koga, at its
headquarters. In the meeting, the LDP decided to reduce the number
of candidates to run in only the proportional representation segment
in the next House of Representatives, as well as to give no
favorable treatment to candidates to run in both single-seat
constituencies and the proportional representation segment.

The LDP also decided to choose those who can win the next Lower
House race as its candidates for six electoral districts in which
former postal rebels as well as their "assassins," who got their
Diet seats in the proportional representation race after being
defeated in single-seat constituency races, plan to run. The party
does not plan to introduce the Costa Rica method, in which one LDP
candidate runs in a single-seat constituency and the other runs for
the proportional representation bloc.

LDP lawmakers who are not being picked as candidates for single-seat
constituencies they had hoped for will have to run in "vacant
districts." The LDP executive has put off the selection of
candidates for "vacant districts" to the Jan. 17 party convention.

In the 2005 Lower House election, the LDP gave favorable treatment
to "assassins" and female candidates. As a result, many first-time
candidates called "Koizumi's children" were elected.

The party leadership, however, has decided to take a strategy of
winning votes in single-seat constituencies, determining that the
LDP will face an uphill fight in the next Lower House.

11) Japan in quandary, ahead of prime minister's planned visit to
China, over China's refusal to correct rewritten document

ASAHI (Page 4) (Excerpts)
December 12, 2007

It was revealed that the Chinese government rewrote a diplomatic
document compiled in a meeting of the Japan-China High-Level
Economic Dialogue and announced the altered one. In reaction, the
Japanese government has urged China to correct its altered
announcement, but the Chinese government has expressed its
unwillingness to respond to Japan's request. With Prime Minister
Fukuda's planned visit to China near at hand, Tokyo hopes to keep
the issue from lingering, but mutual distrust may emerge depending
on China's future response. The government is now under pressure to
respond.

Chinese Foreign Ministry Spokesman Qin Gang stated yesterday: "The
communiqu is not a joint document. It is quite normal that both
sides' contents are not identical." The Chinese Commercial
Department also issued the same day a statement reading: "(Japan and
China) offered the contents of the meeting in their respective
communiqus," making it clear that China will not respond to Japan's
call for correcting its announcement.

It is common in China to post altered contents even on the Foreign
Ministry's website, for instance, deleting or altering descriptions
over such issues as the protection of human rights and Taiwan. There
was a case in which although Premier Wen Jiabao had said in a press
conference in March 2005, when Japan-China relations were strained,
"The relationship with Japan is one of the most important bilateral

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ties," the expression was changed into "important bilateral ties."

It has become customary that differences are found in the contents
of both sides' announcements made after U.S.-China summits. But
since such announcements are made verbally, the differences have
been ignored, in a sense.

This time, however, because China rewrote a document agreed on by
both countries' cabinet ministers, the problem came to light. Qin
criticized the reports by the Japanese media as "going against the
friendly and cooperative atmosphere." The Chinese government is
trying to persist with its own logic, but trust in China in the
international community was certainly undermined.

A diplomatic source said that the Chinese Foreign Ministry has been
caught between the protest from Japan and hard-liners' views in
China. Another person commented: "The People's Bank of China, which
did not take part in the high-level meeting, exerts greater
influence than the Foreign Ministry and the Commercial Department."
One observer points out that the alteration of parts of the document
might be attributed to sectionalism in the Chinese government.

12) Gov't assessment insufficient for Futenma relocation: Okinawa
panel

ASAHI (Page 37) (Full)
December 12, 2007

Japan and the United States have agreed to relocate the U.S.
military's Futenma airfield in Japan's southernmost island
prefecture of Okinawa to the prefecture's northern coastal city of
Nago. In this connection, the Defense Ministry has presented Okinawa
Prefecture with a document explaining how to assess the potential
impact of Futenma airfield's relocation on its newly planned site's
environs. Meanwhile, the Okinawa prefectural government called a
meeting of its environmental impact assessment review panel
yesterday to examine the government-presented procedural document,
with Seiko Tsukayama, a professor emeritus at the University of the
Ryukyus, presiding over the panel. In the meeting, the panel worked
out a report saying that the government document is too lacking in
substance to be examined. The panel will finalize the report on Dec.
14 and will present it to Okinawa Gov. Hirokazu Nakaima early next
week. The governor is expected to state his views to the Defense
Ministry by Dec. 21 in line with the panel report. The governor's
views have no legal binding force. Depending on the government's
response, however, relations between the government and Okinawa
could go from bad to worse.

"It's hard to say that the document is sufficient in substance to
judge whether its description of items and procedures (for an
environmental impact assessment) is appropriate, and it's not enough
to be examined." With this, the panel report criticized the
government document.

The review panel asked 76 additional questions about 35 items on
Nov. 30. The Defense Ministry answered some of these questions. In
its answer, however, the ministry told the panel that what cannot be
made clear at this point would be described in a preparatory
document to be created after environmental assessment. One of the
panel's members opined that it would be too late after an
assessment. The panel report also notes that the government document
fails to give sufficient answers.

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The panel asked what type of aircraft the U.S. military will use at
the newly planned alternative base. In addition, the panel also
asked how many airplanes will be based and what time they will make
flights. The Defense Ministry has yet to clarify these points,
saying that Japan and the United States are now holding discussions.
The panel report says the government should submit another report to
the panel and the Okinawa prefectural government as soon as the
government decides on these items.

13) F-15 remodeling cost to be slashed

SANKEI (Page 2) (Abridged)
December 12, 2007

The Defense Ministry has plans to modernize the Air Self-Defense
Force's F-15 mainstay fighter jets. However, the Defense Ministry's
budget estimate for its plan to remodel 32 F-15 fighters will be
slashed, sources said. The budget will be held down for about 20
F-15s, according to the sources. The F-15 remodeling plan was
intended to vie with China's rapid modernization of its air force.
However, the Finance Ministry severely scrutinized the Defense
Ministry's budget estimate in the wake of scandals involving the
Defense Ministry. The Defense Ministry has earmarked 112.3 billion
yen in its budget request for F-15 modernization. However, it is
certain that the F-15 budget slot will not be approved.

Japan's neighbors, including China, are deploying fourth-generation
fighter jets at a high pitch. The F-15 is also a fighter model of
the fourth generation. The Defense Ministry plans to enhance the
F-15's radar and missile performance. The government's current
midterm defense buildup plan is for the period of five fiscal years
from 2005 to 2009. According to this plan, the Defense Ministry
plans to remodel 26 F-15s. Eight F-15s have already undergone
remodeling.

In July this year, the U.S. Congress decided to continue the United
States' embargo on the F-22 Raptor, a likely candidate for the Air
Self-Defense Force's follow-on fighter support plane (FX). The
Defense Ministry therefore intended to speed up F-15 remodeling in
an effort to improve Japan's antiaircraft capability. As it stands,
the Defense Ministry earmarked 112.3 billion yen in its fiscal 2008
budgetary estimate to remodel 32 F-15s that outnumber those planned
under the midterm defense buildup program.

SCHIEFFER

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