Hatoyama leaves Cabinet over Japan Post row, dealing Aso another blow+

TOKYO, June 12 Kyodo -
Internal affairs minister Kunio Hatoyama resigned Friday over a high-profile
row concerning the reappointment of the president of Japan Post Holdings Co.,
dealing a blow to Prime Minister Taro Aso with a national election due within a
few months.

Although Hatoyama submitted a resignation letter to Aso, the move was seen by
political pundits as Aso effectively dismissing his close ally who helped him
become prime minister, since Hatoyama was adamantly opposed to the premier's
decision to have Yoshifumi Nishikawa stay as president of the government-owned
Japan Post.
''After consulting with my colleagues, I decided to leave gracefully,'' he told
reporters after submitting a letter of resignation to the prime minister, who
accepted it on the spot. ''History will prove me right'' over the matter, he
added.
On the possibility of leaving the ruling Liberal Democratic Party, 60-year-old
Hatoyama said, ''I will consult with my colleagues. I've been receiving various
kinds of encouragement from many colleagues.''
Hatoyama, minister of internal affairs and communications, became the third
minister to leave the Aso Cabinet following former Land, Infrastructure,
Transport and Tourism Minister Nariaki Nakayama, and former Finance Minster
Shoichi Nakagawa.
''It's very regrettable that (the resignation) gave the impression that there
has been confusion between the government and Japan Post. The situation has to
be dealt with swiftly,'' Aso, 68, told reporters.
On whether Nishikawa should remain in the post, Aso said, ''Basically, the
state should avoid interfering with private businesses,'' adding he will make a
decision after the new minister makes a judgment about the firm's response to
the government's business improvement order.
Japan Post, currently owned 100 percent by the government, will be privatized
over a 10-year period starting in October 2007.
National Public Safety Commission chief Tsutomu Sato, 56, was appointed to
double as internal affairs minister, Chief Cabinet Secretary Takeo Kawamura
said.
The resignation of Hatoyama, who served as Aso's election campaign manager in
the LDP presidential race in September, is expected to deliver a heavy blow to
the Aso administration just prior to an imminent House of Representatives
election, which must be held by the fall.
Following Hatoyama's resignation, Toru Toida said he will resign as
parliamentary secretary of health, labor and welfare to show support for
Hatoyama.
Yoshihisa Furukawa, parliamentary secretary of environment, was also quoted by
other lawmakers as saying he will resign, but he later told reporters he will
not quit.
Nakayama was forced to resign as transport minister soon after the Aso
government's launch in September due to a series of verbal gaffes, while
Nakagawa resigned as finance minister in February following criticism over his
apparent drunken behavior at a press conference in Rome.
Top government spokesman Kawamura said at a news conference that the prime
minister always bears responsibility for appointing ministers and the
government needs to accept such responsibility.
The prime minister ''had no choice but to accept the resignation, judging that
there is no room for making arrangements'' which Aso had instructed ministers
concerned to make over the matter, Kawamura said.
In rejecting Aso's decision to have Nishikawa remain as Japan Post chief,
Hatoyama repeatedly criticized the firm's recent controversial attempt to sell
the Kampo-no-yado nationwide resort inn network.
According to Hatoyama, Aso proposed a compromise to Hatoyama in which Nishikawa
would apologize to Hatoyama after which Hatoyama would allow Nishikawa to
remain in the post, but he turned it down.
Hatoyama told reporters, ''I don't think I'm a righteous person; I've made many
mistakes. But I just can't tolerate someone who did something dirty and that's
my political belief.''
Pressure has been mounting among LDP lawmakers that Aso should make a decision
and settle the row quickly amid concern the party would suffer bigger damage if
the conflict within the Cabinet and the party is prolonged.
Japan Post decided late last year to sell dozens of Kampo-no-yado inns and nine
housing facilities to leasing firm Orix for 10.9 billion yen as a result of
competitive bidding.
But Hatoyama voiced his opposition to the deal in January, calling it ''a race
whose result had already been decided'' as Orix Chairman Yoshihiko Miyauchi had
been involved in crafting the government's plan to privatize Japan's postal
services.
Japan Post and Orix subsequently gave up the contract.
Though Japan Post decided in May to keep Nishikawa in the top position of the
firm, Hatoyama, who had ultimate authority in deciding who would be board
members of Japan Post, expressed an intention not to accept the decision.
Heavyweight LDP lawmakers such as former Chief Cabinet Secretary Nobutaka
Machimura and former LDP Secretary General Tsutomu Takebe have expressed
opposition to Hatoyama, saying that having Nishikawa step down would lead to a
setback in postal privatization.
Hatoyama is the younger brother of Yukio Hatoyama, the leader of the main
opposition Democratic Party of Japan.
The possibility of political realignment after the next general election is
likely to emerge as one of the major focuses in Japan's political circles as
Hatoyama has mentioned to lawmakers close to him the possibility of creating a
new party if the prime minister decided to have Nishikawa remain in the post.
==Kyodo