Wednesday, February 13, 2008

In Case Anybody’s Still Worried about the BOJ Succession…

Sankei has the best online reproduction of its hard copy version, and it’s doing this as part of its partnership deal with MSN. I can’t help loving Sankei. I can’t help loving Microsoft. So sue me.

Seriously, one of the good things that Sankei does is to reproduce the Chief Cabinet Secretary’s press briefings in full. Here’s my translation of an excerpt from the February 8 briefing:

Q: In a speech Mr. Tanigaki, [LDP] Policy Research Council Chairman, gave today in Tokyo, he said with regard to the candidacy for BOJ Governor that the ability to communicate to the market was important and that Deputy Governor Mutō had the requisite qualifications. Deputy Governor Mutō, his name has been coming up before; do you think that he is sufficiently qualified?

A. I will not talk about individual names.

Q. How about the BOJ’s personnel decision process next week and beyond (ed. The briefing took place on Friday)?

A. I’m not saying anything.

And that was the end of it. Smart move**; the leaks coming out of the LDP side must have been at the roots of all the commotion in the first place. Expect the LDP to keep a lid on it until the Diet vetting process goes forward. In the meantime, the DPJ seems to be holding up their end of the implicit bargain and eager to calm the waters. Today’s hardcopy Yomiuri has a page four report of a couple of press briefings by DPJ Leaders with a headline (Mr. Ozawa Leaves Door Open to Accepting Mr. Mutō (subtitle Ruling Parties Give Full Negotiating Mandate to Diet Affairs Committee Chairman) almost identical to that of the February 9 article. Here are the translations of the quotes*:

Mr. Ozawa: With regard to the consent for the appointment, it is to be decided yes or no in a meeting of the (party) leaders in Diet matters. (The report interprets this as the intent to make the final determination in the DPJ meeting of Diet member leaders, including Mr. Ozawa, the Secretary-General (Yukio Hatoyama) and the Diet Affairs Committee Chairman (Kenji Yamaoka))

Separation of fiscal and financial [policies] is one line of thought. On the other hand, [the government] has bonds worth 1000 trillion yen outstanding, so (fiscal policy) has a very close relationship with financial policy. There are opinions to the effect that [the issue] should not be determined solely by the logic of separation of fiscal and financial [policies].”
(The report interprets this as opening the door to the acceptance of Mr. Mutō’s promotion.)

Kenji Hirata; LDP Upper House Secretary-General: It is arrogant to say that this person won’t do before the government has said, “Please accept this person.” (The report interprets this as a criticism of Mr. Sengoku’s negative comment in Seoul with regard to Mr. Mutō.)

The article goes on to say that Kazumori Ōshima and Mr. Yamaoka, the Diet Affairs Committee Chairmen of the LDP and DPJ respectively, will hammer out the procedures for the Diet process.

So both sides are playing it cool. Expect little of note in the media, until the Diet hearings and the subsequent consent. Nobody has lost, except perhaps the Ozawa-unfriendly Mr. Sentani. All in all, a good deal for the markets.

* Keep in mind that newspaper quotes are not always verbatim renditions. In this case, however, I don’t think that there is any undue paraphrasing.

** Mr. Machimura has other reasons to mind his words. He has a surprisingly sharp tongue, and it has been getting him into trouble from time to time. Yesterday, he had to apologize in the Diet for insinuating in the Lower House Budget Committee that Mr. Ozawa had acted improperly with regard to party funds when he merged his Liberal Party into the old DPJ in 2003. He also asked that the offending comments be deleted. Permission granted. The controversy itself is discussed in this previous post.

Completely off-topic: Speaking of a quiet media, there’s been a deafening silence around the Defense Ministry scandals during this Diet session. Perhaps I was right and the LDP did luck out when it blew open during the previous extraordinary session. Let’s see if the DPJ decides to revive it (or, more significantly, something happens that compels it to do so) as April 1 approaches and it’s crunch time for the budget and the budget-related legislation. I removed this paragraph inadvertently when I was correcting some typos after I had posted it. I noticed it when I added the subsequent paragraph, so I am restoring it now.

ADD: Taking the matter up at the party leadership as a matter of logic takes the decision away from Mr. Sengoku, contrary to what Mr. Ozawa had stated initially.

ADD 2: Here’s my translation of an excerpt from the February 12 Chief Cabinet Secretary briefing:

Q. Will the BOJ appointments be submitted to the Diet this week? Also, there are news reports that a proposal to appoint (Toshirō) Muto as Governor and former BOJ board member Masaaki Shirakawa as Deputy Governor, so what are the facts?

A. That news report has no foundation in facts. In any case, the honorable Takeo Nishioka, Chairman of the Upper House Rules and Administration Committee, has said that if BOJ appointments are reported, that will be considered prior leaking by the government and [the appointments] shall not be given confirmation. Since these conditions or rules, shall we say, exist, I am sorry, but with regard to the issue of the BOJ Governor, regardless of what kind of question you may put forth, I definitely will not answer them.

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