Cablegate: Japanese Morning Press Highlights 02/10/10

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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 02/10/10

INDEX:

1) Top headlines
2) Editorials

Defense & security:
3) Gov't/ruling party team leaves for Guam today (Tokyo Shimbun)
4) Bill would expand application of base subsidies (Asahi)
5) Okada hopes for March release of report on secret nuclear accords
(Asahi)

Foreign relations:
6) Okada to assist Ozawa with U.S. trip (Asahi)
7) Foreign Minister Okada leaves for S. Korea today (Yomiuri)

Politics:
8) Bill revising National Civil Service Law would establish Kantei
leadership in personnel matters (Yomiuri)
9) Diet debate (Yomiuri)
10) PM says DPJ says coalition will continue even though DPJ now has
Upper House majority (Sankei)
11) Edano chosen government revitalization minister (Tokyo Shimbun)

12) Ishikawa will not give up Diet seat or quit party (Yomiuri)
13) Ishikawa mulling quitting DPJ (Asahi)

Economy:
13) Toyota to recall 430,000 vehicles (Yomiuri)
15) JAL confirms tie-up with American (Yomiuri)

ARTICLES:

1) TOP HEADLINES

Asahi:
Toyota admits to defects in its vehicles

Mainichi:
Chinese historians call Tiananmen Square incident "political
unrest," showing difference from Japanese view

Yomiuri, Sankei & Akahata:
Toyota to recall 430,000 vehicles worldwide

Nikkei:
Toshiba to build new chip-making plant at cost of 800 billion yen

Tokyo Shimbun:
Hatoyama to appoint Edano as administrative reform minister

2) EDITORIALS

Asahi:
(1) Failure of merger talks of beverage companies: Take up the
challenge once again
(2) Palestine: Do not forget Gaza's tragedy

Mainichi:
(1) Ozawa's news conference on remaining in post as DPJ secretary
general: This is not the end of the story
(2) Draft bill on postal reform: Purpose is unclear

TOKYO 00000276 002 OF 008

Yomiuri:
(1) Draft bill on postal reform: Avoid the re-expansion of
government-sponsored financial services
(2) Failure of merger talks of major beverage companies: Difference
in corporate culture significant

Nikkei:
(1) Review of financial regulations should be based on reality
(2) Ukraine goes back to being pro-Russia

Sankei:
(1) Ozawa's declaration of "innocence": Nothing but a show of
defiance
(2) Malpractice by Koito Industries: Malicious neglect of safety

Tokyo Shimbun:
(1) Business taking advantage of the poor: Outrageous that
government support should generate huge profits
(2) Ukraine: Hope for balanced national administration

Akahata:
(1) Politics and money: Why hesitate to ban corporate political
donations?

DEFENSE & SECURITY

3) Guam visit a journey of people with different dreams in the same
bed

TOKYO SHIMBUN (Page 2) (Full)
February 10, 2010

Members of the Okinawa Base Issues Review Committee, a joint panel
of the government and the ruling parties, will leave Japan today for
Guam to study where to relocate the U.S. military's Futenma airfield
currently located in Ginowan, Okinawa Prefecture. The Social
Democratic Party, which is aiming to move Futenma airfield out of
Okinawa Prefecture or Japan, wants the Futenma airfield facility
relocated to Guam. However, there are cautious arguments within the
government from the perspective of maintaining deterrence. The Guam
visit will be a journey of people having different dreams while
sleeping in the same bed.

Those participating in the Guam visit include Deputy Chief Cabinet
Secretary Yorihisa Matsuno; Tomoko Abe, chief of the SDP's policy
board; and Mikio Shimoji, chief of the People's New Party's policy
board. Tomorrow they will visit Andersen Air Force Base and other
facilities and hold talks with U.S. military officials.

The committee met yesterday and confirmed its Guam itinerary. At the
same time, it also decided that the SDP and the PNP will introduce
their respective relocation candidate sites when it meets on Feb.
17.

Guam is to receive about 8,000 U.S. Marines from Okinawa in
accordance with a "roadmap" based on an agreement between the
governments of Japan and the United States regarding the realignment
of U.S. forces in Japan. Guam's local communities are opposed to
also accepting the functions of Futenma airfield.

The government does not want the Futenma issue to have a negative
impact on the roadmap, so in reality it wants the SDP to give up on

TOKYO 00000276 003 OF 008

relocation to Guam after visiting the island.

The government is taking the careful step of visiting Guam in order
to forestall criticism from the SDP that it failed to coordinate
sufficiently with the ruling parties.

4) Government to submit bill to expand application of military base
subsidies

ASAHI (Page 4) (Full)
February 10, 2010

The government adopted in a cabinet meeting yesterday a bill to
amend the law related to improving the living conditions in areas
surrounding defense facilities. The law stipulates the subsidy
system for municipalities hosting bases of the Self-Defense Forces
(SDF) and U.S. forces in Japan. The government submitted the
legislation to the Diet on the same day. During budget screening by
the Government Revitalization Unit, the government was asked to make
the usage of subsidies more flexible and convenient. As a result,
the government bill would allow the municipalities to use the
subsidies for medical services, community bus operations, and other
services.

5) Okada: Secret nuclear pact report should be released in March

ASAHI (Page 8) (Full)
Eve., February 9, 2010

Prime Minister Yukio Hatoyama, attending a House of Representatives
Budget Committee meeting this morning, stated: "At a meeting of
United Nations Security Council leaders last September, I mentioned
that Japan, as a moral responsibility, will have to take the lead in
denuclearization. Based on this belief, I'm determined to firmly
maintain the three nonnuclear principles." Hatoyama thus indicated
that the government will maintain Japan's three nonnuclear
principles of "not producing or possessing nuclear weapons and not
allowing nuclear weapons into the country."

Hatoyama made this comment in reply to a question asked by Hideo
Hiraoka, a House of Representatives member of the ruling Democratic
Party of Japan. Concerning the existence of secret nuclear pacts
between Japan and the United States, the Foreign Ministry conducted
an investigation of facts in response to Foreign Minister Katsuya
Okada's instructions and the ministry wound up the investigation
last November. The ministry, in its fact-finding report, will unveil
Japanese government documents that confirm the existence of
documents that substantiate the arcane deals, the Asahi Shimbun has
reported.

The ministry will release its findings after an advisory panel of
experts has verified the facts.

Okada stated: "I hope the results of (the expert panel's)
verification will be released in March. Also, I'd like to produce a
report on the third party's interpretation of facts and (analysis
of) historical backdrop (in addition to the ministry's fact-finding
report)."

FOREIGN RELATIONS

6) Foreign Minister Okada: If Ozawa decides to visit U.S., I will

TOKYO 00000276 004 OF 008

support him

ASAHI (Page 4) (Full)
February 10, 2010

Commenting at a press conference yesterday on U.S. Assistant
Secretary of State Kurt Campbell's request for Democratic Party of
Japan Secretary General Ichiro Ozawa to visit Washington in May,
Foreign Minister Katsuya Okada said, "If the secretary general of
the largest ruling party decides to visit the United States, I will
support him." Asked by reporters about Ozawa's desire to meet with
President Obama, Okada avoided commenting directly, saying, "I
haven't heard any details about it."

7) Foreign Minister Okada to leave for South Korea today

YOMIURI (Page 2) (Full)
February 10, 2010

Foreign Minister Katsuya Okada will leave for Seoul today to hold
talks with his South Korean counterpart. He will meet on Feb. 11
with Foreign Affairs and Trade Minister Yu Myung-hwan and make a
courtesy call on President Lee Myung-bak. In their foreign
ministerial meeting, Okada and Yu are expected to agree to set up
the third round of the Japan-South Korea Cultural Exchange Council,
which comprises experts from the two countries. They will also
reaffirm bilateral cooperation for an early resumption of the
Six-Party Talks.

POLITICS

8) Government presents draft bill to amend National Public Service
Act to strengthen Kantei's power of appointment

YOMIURI (Page 2) (Full)
February 10, 2010

The government presented to the Cabinet Office policy council on
Feb. 9 its draft bill to amend the National Public Service Act. The
main provisions of the bill include the creation of a new "cabinet
personnel bureau" in the Cabinet Secretariat and a "list of
candidates for senior officials" across ministerial boundaries to
allow the Prime Minister's Official Residence (Kantei) to take the
initiative in personnel appointments. The Public Prosecutors Office
and a number of other bodies are exempted from these rules. The
draft bill is scheduled to be approved by the cabinet on Feb. 12,
aiming at implementation from April 1.

The list of candidate senior officials will include senior
bureaucrats and private citizens who applied for job openings
offered to the public who are judged to be qualified by the chief
cabinet secretary through a screening process. Basically, senior
bureaucrats in the ministries will be appointed from this list.
However, there is also a provision stating that in order to achieve
appointments on merit, including moving officials across ministerial
boundaries, by the cabinet as a whole, the prime minister and the
chief cabinet secretary will hold prior consultations on
appointments with the ministers. The vice minister, who is the top
bureaucrat, is regarded to be "of the same grade in the
organizational structure" as the bureau director general. It will
now be able to demote a vice minister to bureau director general,
and it is also possible to demote a bureau director general to a

TOKYO 00000276 005 OF 008

department director general.

Senior officials of the Public Prosecutors Office, the National
Personnel Authority, the Board of Audit, and the National Police
Agency are "exempted" from this unified personnel management under
the list "in consideration of the specialized nature of their
duties." Chief Cabinet Secretary Hirofumi Hirano says that the new
system "will ensure greater neutrality and independence." With
regard to the Imperial Household Agency and the Cabinet Legislation
Bureau, while the list will be utilized, prior consultations with
the prime minister or the chief cabinet secretary will not be
required.

Even for the appointments of senior bureaucrats that do not come
under the list, there will still be room to make political decisions
through a cabinet resolution. However, since the Democratic Party of
Japan (DPJ) once showed a confrontational attitude toward the
prosecutors over the violation of the Political Funds Control Law by
Secretary General Ichiro Ozawa's fund management organization, the
Rikuzan-kai, there is an opinion that the new bill "serves to dispel
speculations that the DPJ plans to retaliate against the prosecutors
through appointments."

9) Gist of interpellations at Lower House Budget Committee on
February 9

YOMIURI (Page 13) (Excerpts)
February 10, 2010

Local suffrage for permanent resident foreigners

Sanae Takaichi (Liberal Democratic Party): Do you plan to grant
local suffrage to permanent resident foreigners?

Prime Minister Yukio Hatoyama: There is still no consensus in the
government. Since this is an issue relating to elections, all
parties need to reach an agreement. We cannot push for this too
forcefully. There are also issues relating to security. We are not
yet in a position (to submit a bill) since the government has not
drafted a plan. I do not think this requires a revision of the
Constitution.

Investigation of "secret agreements"

Hideo Hiraoka (Democratic Party of Japan (DPJ)): When will the
experts' committee investigating the "secret agreements" between
Japan and the U.S. issue a report?

Foreign Minister Katsuya Okada: The investigation of the experts'
committee is a thoroughgoing process, and committee members are
actively conducting hearings from persons related to these
agreements. I am not able to say for sure, but I am hoping that a
report will be issued at an appropriate time in March.

Official development assistance (ODA)

Koichi Yamauchi (Your Party): The ODA budget has been reduced
considerably.

Hatoyama: Under the tight fiscal situation, we will only implement
projects that are absolutely necessary. The budget focuses on
Afghanistan, Africa, the environment, and other such issues.

TOKYO 00000276 006 OF 008

Structural reforms

Toshiaki Koizumi (DPJ): How would you assess the structural reforms
of former Prime Minister Koizumi?

State Minister for Financial Affairs Shizuka Kamei: They were meant
to change the distribution of wealth and the industrial structure,
but they did not result in an increase in the people's disposable
income. If we do the opposite (of structural reforms), we can open
up Japan's future.

Okinawa's economic development

Mikio Shimoji (People's New Party): Okinawa is in an economic
crisis.

Minister for Okinawa Affairs Seiji Maehara: The number of tourists
visiting Okinawa, which had increased for seven consecutive years,
declined last year. We will strive to attract tourists from foreign
countries in addition to Japanese tourists.

10) PM Hatoyama: Three-party coalition to be maintained despite
DPJ's control of majority in Upper House

SANKEI (Page 5) (Full)
February 10, 2010

The House of Councillors floor group consisting of the Democratic
Party of Japan (DPJ), the Shin-Ryokufukai, the People's New Party
(PNP), and the New Party Nippon (NPN) submitted to Upper House
President Satsuki Eda on Feb. 9 a notification on the accession to
the DPJ of former Liberal Democratic Party (LDP) member Kotaro
Tamura. This floor group will now consist of 121 members, reaching a
majority in the Upper House, not counting Eda (who normally does not
take part in voting).

Commenting on the fact that it will now be possible to pass bills
without the cooperation of the Social Democratic Party (SDP), Prime
Minister Yukio Hatoyama stated on the evening of Feb. 9: "This is a
coalition government, so we would like to continue to work with the
SDP and the PNP in a good cooperative relationship," indicating that
he intends to maintain the current coalition framework.

With Tamura joining the DPJ-led floor group, following is the number
of seats held by each floor group in the Upper House:

DPJ, Shin-Ryokufukai, PNP, NPN - 121
LDP, Kaikaku Club - 82
New Komeito - 21
Japanese Communist Party - 7
SDP, Goken Rengo - 5
Independents - 6

11) Hatoyama to appoint Edano as administrative reform minister

TOKYO SHIMBUN (Top Play) (Excerpts)
Feb. 10, 2010

Prime Minister Yukio Hatoyama decided yesterday to appoint Yukio
Edano, 45, former chairman of the Democratic Party of Japan's (DPJ)
Policy Research Council, as administrative reform minister. Yoshito

TOKYO 00000276 007 OF 008

Sengoku now holds the posts of administrative reform minister and
national policy minister concurrently. Sengoku will devote himself
to his duties as national policy minister from now on, according to
government sources. Hatoyama will summon Edano to the Prime
Minister's Official Residence this morning and an attestation
ceremony will be held at the Imperial Palace.

The appointment of Edano is intended to reduce the heavy workload of
Sengoku. Edano led the sessions to identify wasteful government
spending last fall. Based on his performance at that time, Hatoyama
judged Edano to have adaptable skills. Amid falling public support
for the administration due to fund-raising scandals involving
himself and Secretary General Ichiro Ozawa, Hatoyama also hopes to
shore up his administration's standing by changing public
sentiments.

According to aides to Hatoyama, Ozawa has approved the appointment,
but Hatoyama's selection of Edano, who distances himself from Ozawa,
may affect the relationship between the cabinet and the DPJ.

12) Lawmaker Ishikawa neither to resign nor leave DPJ

YOMIURI (Page 1) (Excerpt)
February 10, 2010

Lower House member Tomohiro Ishikawa (36), who was indicted on a
charge of allegedly violating the Political Funds Control Law in a
land purchase made by Democratic Party of Japan Secretary General
Ichiro Ozawa's political funds management body "Rikuzan-kai," on
Feb. 9 told a press conference in Obihiro City, Hokkaido, "I would
like to discharge the responsibilities given to me." He thus
clarified his stance of neither resigning as a lawmaker nor leaving
the party.

13) Lawmaker Ishikawa likely to leave DPJ

ASAHI (Page 1) (Excerpt)
February 10, 2010

Lower House member Tomohiro Ishikawa of the Democratic Party of
Japan (DPJ), elected from the Hokkaido Constituency No. 11, who was
indicted on the charge of allegedly violating the Political Funds
Control Law (false reporting of political funds) in a land purchase
made by DPJ Secretary General Ichiro Ozawa's fund management body,
is now likely to leave the DPJ. Ishikawa consulted with close aides
to Ozawa on his next course of action. He is expected to reach a
final decision shortly.

ECONOMY

14) Toyota to recall 430,000 vehicles globally

YOMIURI (Top Play) (Lead paragraph)
February 10, 2010

Toyota Motor Corp. informed the Land, Infrastructure, Transport and
Tourism Ministry yesterday of a plan to recall about 220,000 cars in
response to complaints about brakes in its four models of hybrid
vehicle (HV), including the latest version of Prius. The company
also notified authorities in the U.S. and Europe of a recall. Toyota
will fix brake problems in a total of about 437,000 vehicles. When
it was unveiled on Feb. 3 that Toyota had received complaints about

TOKYO 00000276 008 OF 008

its vehicles' brakes, the automaker explained there was no problem
with their safety. But the company decided to recall the models for
reasons including an increase in complaints from users and the
ministry's judgment that the vehicles might not conform to safety
standards.

15) JAL, American Airlines to maintain alliance

YOMIURI (Page 2) (Excerpts)
February 10, 2010

Japan Airlines (JAL), currently in the midst of court-protected
corporate rehabilitation, formally announced on Feb. 9 that it would
break off its tie-up talks with Delta Air Lines and maintain its
business alliance with American Airlines. JAL and American Airlines
will apply for antitrust immunity status (ATI) under the U.S.
Antitrust Act with the U.S. government in mid-February so as to
facilitate their joint operations on Pacific routes connecting Japan
and the U.S. JAL's bankruptcy administrators' group, consisting of
Chairman Kazuo Inamori and executives of the Enterprise Turnaround
Initiative Corporation of Japan (ETIC), unanimously adopted the
decision on JAL's business partner and notified Delta of their
decision to terminate the tie-up talks.

The battle between the two U.S. carriers to become JAL's business
partner, which surfaced in September 2009, has ended with JAL's
decision to continue and strengthen its business tie-up with
American Airlines, a member of the Oneworld airline alliance to
which JAL also belongs.

ROOS

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