Kan Appoints Ozawa Critic Edano as Japanese Ruling Party's No. 2 Official

Japan’s Prime Minister-elect Naoto Kan appointed Yukio Edano as his party’s No. 2 official, further distancing himself from the political powerbroker whose funding scandals helped bring down the previous administration.

Kan today named Edano, 46, as the Democratic Party of Japan’s secretary-general, replacing Ichiro Ozawa. Ozawa, the architect of last August’s DPJ election victory, quit last week along with Premier Yukio Hatoyama to take responsibility for disputes over campaign finances and relocating U.S. troops ahead of next month’s elections for the upper house of parliament.

“I want to promote transparency within the party management,” Edano said after Kan’s announcement in Tokyo.

Ozawa had previously refused to step down after three of his aides were indicted for violating campaign funding laws in February. Kan, 63, last week said after Hatoyama stepped down that Ozawa “should stay quiet for a while,” a judgment polls show that four in five voters share.

“Kan has been able to change the media image that the DPJ is controlled by Ozawa,” said Yasunori Sone, a political science professor at Keio University in Tokyo. “At the same time, he’s trying to maintain party balance because Ozawa’s power may be needed later.”

Edano, who served as Hatoyama’s administrative revitalization minister, urged Ozawa to quit as secretary- general in January to take responsibility for the scandals.

‘Settle the Matter’

“If he cannot gain people’s understanding and conviction, he must settle the matter once and for all,” the Yomiuri newspaper on Jan. 31 quoted Edano as saying.

Kan also appointed Shinji Tarutoko, who ran against him in last week’s party leadership race, to be parliamentary affairs chief. Lower house legislator Koichiro Gemba was named head of the DPJ’s policy board. Gemba, 46, the lower house chairman of fiscal and finance committee, formed a group last month of more than 100 lawmakers to study Japan’s fiscal situation.

Gemba said today his party should include a tax reform plan in its manifesto for next month’s election and prepare a plan regarding the nation’s 5 percent sales tax by the next lower- house race.

Hatoyama said on June 2 he and Ozawa would resign, apologizing for the finance scandals and a broken promise to move a U.S. base off Okinawa that sent his approval rating tumbling more than 50 points. Kan said the next day that Ozawa had “invited distrust from the public,” adding that it would be better for the party and Japan if he lowered his profile.

Cabinet Lineup

The DPJ’s approval ratings have jumped since Kan, who will announce his cabinet and take power tomorrow, was chosen by parliament to replace Hatoyama. The Asahi newspaper yesterday said 82 percent of voters approved of how Kan has dealt with Ozawa. The paper surveyed 1,074 voters on June 4-5 and didn’t provide a margin of error.

National Strategy Minister Yoshito Sengoku, 64, will replace Hirofumi Hirano as chief cabinet secretary while Yoshihiko Noda, 53, will succeed Kan as finance minister, Kyodo and other media said. Foreign Minister Katsuya Okada, trade minister Masayuki Naoshima and Defense Minister Toshimi Kitazawa will keep their posts, Kyodo said, citing unidentified party sources.

Ozawa, who was forced to quit as head of the DPJ in May 2009 after his top campaign official was indicted, heads the largest faction in the party.

Support Rises

The DPJ received a 36.1 percent support rate in a Kyodo News poll published two days ago, an increase of 15.6 percentage points from the end of May. Kan “inspired hope” in 57.6 percent of those surveyed, Kyodo said. The Asahi poll said 59 percent of the public has high hopes for Kan, who has spawned a T-shirt that plays on Barack Obama’s campaign slogan by proclaiming, “Yes we Kan.”

Kan has said he will work to carry out the policies of his predecessor. In a phone call with President Obama on the weekend, Kan promised he would abide by Hatoyama’s decision to relocate the Futenma U.S. Marine base to another site in Okinawa, according to a statement from Japan’s foreign ministry.

The DPJ faces its first national test as the incumbent in upper house elections to be held in July. The party ousted the Liberal Democratic Party from power in a landslide victory last August, ending the LDP’s 50-year lock on power.

To contact the reporter on this story: Sachiko Sakamaki in Tokyo at Ssakamaki1@bloomberg.net; Takashi Hirokawa in Tokyo at thirokawa@bloomberg.net

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