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Thursday, Aug. 11, 2011

Deal on bills looks to pave Kan's way out

Opposition accord puts DPJ on track to pick new leader


Staff writer

Prime Minister Naoto Kan's hoped-for exit by month's end got new legs Wednesday, after a Lower House committee OK'd a key bond-issuance bill for passage later in the month and Democratic Party of Japan lawmakers began laying the groundwork for a race to elect a new leader.

Kan had suggested he would quit soon after securing Diet passage of the debt bill, which allows the government to issue deficit-covering bonds to finance 40 percent of spending in fiscal 2011, and another bill promoting the use of renewable energy. The energy bill is also on course for Diet passage by the end of the month, lawmakers said.

The debt bill was expected to be approved by the Lower House on Thursday and sent to the Upper House.

During Diet committee sessions Wednesday, Kan himself made remarks indicating he was already in exit mode.

"I want to fulfill what I have said before when the two bills are enacted," Kan said during the Lower House Audit and Oversight of Administration Committee.

"The DPJ will hold a presidential election. When a new leader is elected, I need to act as a prime minister accordingly," he said at a separate Financial Affairs Committee meeting in the afternoon.

The conditions for the departure of Kan — who until recently had been seen as trying to cling to power beyond August — picked up steam Tuesday after the ruling DPJ and the Liberal Democratic Party and New Komeito agreed on Diet passage of the debt-issuance bill.

Although the specific date for Kan's exit still remains unclear, DPJ Secretary General Katsuya Okada reassured his LDP counterpart, Nobuteru Ishihara, on Tuesday that Kan would quit by the end of the current Diet session, set to wrap up Aug. 31.

The DPJ's deal with the opposition parties moved Kan's departure one step closer to reality Wednesday, with the two camps agreeing to aim for Diet passage of the two bills by Aug. 26, lawmakers said.

Kan initially set the passage of three bills — a second extra budget bill in addition to the debt and renewable energy bills — as conditions for his exit. The extra budget has already been enacted.

Now that the two remaining hurdles are virtually certain to be cleared, the DPJ ranks are aiming to hold a party presidential vote as early as Aug. 28, according to sources within the party.

Possible candidates include Finance Minister Yoshihiko Noda, who on Tuesday postponed an announcement of his candidacy given the unstable condition of financial markets, and Sumio Mabuchi, a former transport minister and an ex-member of a faction headed by Noda.

Former Environment Minister Sakihito Ozawa is also likely to join the race.

Noda, seen as the strongest candidate of the three, expressed his willingness to lead the country in a Bungei Shunju monthly magazine article that hit newsstands Wednesday. "When the time is right, I'm ready to be the head" of the nation, he said.

In the article, he pointed out the necessity of tax reforms in order to restore financial health and to improve the social security system in the rapidly aging society.

While avoiding mention of a tax hike, which is likely to be the crucial issue of the party election, he wrote that "there is a limit to restoring financial health just through cutting expenses" and economic growth, hinting tax reforms are unavoidable.

Mabuchi, however, voiced strong opposition to a tax hike in a separate article in the same magazine. "We should not head toward a tax increase," he wrote, adding he is not satisfied with the tax and social security reforms the government proposed in June, which stated that the sales tax would be raised in stages to 10 percent by fiscal 2015.

Besides Noda, Mabuchi, and Sakihito Ozawa, industry minister Banri Kaieda, farm minister Michihiko Kano and ex-Foreign Minister Seiji Maehara have all been floated as possible candidates. Kaieda, irked by Kan's stance against nuclear plants, has indicated he plans to resign, but hasn't clarified when.

Information from Kyodo added

Kan's U.S. trip unlikely

KYODO

Prime Minister Naoto Kan will not be visiting the United States in early September, given his increasing inclination to step down by month's end, government sources said Wednesday.

The government hopes to arrange talks between Kan's successor and U.S. President Barack Obama in late September on the sidelines of the U.N. General Assembly session in New York, the sources said.

Even if a new prime minister is chosen this month, a U.S. trip in early September would be "difficult from a practical point of view," one of the sources said.

During their talks in Yokohama in November, Obama invited Kan to the United States in the first half of 2011. That trip was postponed, however, due to a stalemate over the relocation of U.S. Marine Corps Air Station Futenma within Okinawa, and then by the March 11 disasters and ensuing nuclear crisis.

Kan and Obama rescheduled the visit for early September when they met during the Group of Eight summit in France in May.

Since Kan expressed in early June his intention to resign in the near future, his office has not issued specific instructions to the Foreign Ministry about the U.S. trip, a senior ministry official said.

Tokyo and Washington have been working to issue at the summit a joint statement on a vision for the bilateral alliance in the 21st century, but the details have yet to be ironed out, the official said.

Referring to the looming cancellation of Kan's trip, a ruling party lawmaker said, "The United States will no longer deal with a lame-duck administration."

The new prime minister is also likely to attend the high-level U.N. meeting on nuclear safety and security in New York on Sept. 22, as well as the U.N. General Assembly that opens Sept. 13.

Kan, who has been under intense pressure to quit, said at Wednesday's Diet session that he is ready to quit soon after two key bills are passed, which is likely to be in late August.



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