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An unfolding bribery scandal surrounding an insurance group for small business led to the resignation of Mr. Fukushiro Nukaga, state minister for economic and fiscal policy, on Tuesday. Just a week earlier, Mr. Takao Koyama, a Liberal Democratic member of the Upper House, was arrested on charges of receiving a bribe from the group, known as KSD. What is emerging is an extensive “money-for-influence” scandal reaching deep into the corridors of power.

The first order of business is to unravel the whole truth as soon as possible. Prosecutors have their work cut out. At the same time the Diet must conduct its own investigations to clarify the political and moral responsibilities of the politicians involved. Mr. Nukaga, among others, should be summoned for testimony. Prime Minister Yoshiro Mori, who appointed Mr. Nukaga to the key Cabinet post, cannot stand above the fray. The situation appears different from last year when, in a scandal involving payment of party membership dues, Mr. Kimitaka Kuze resigned as chairman of the Financial Reconstruction Commission. Then Mr. Mori pulled through without serious damage to his standing. This time the going may be rough.

Mr. Nukaga allegedly received a total of 15 million yen from KSD in November 1999 and April 2000 when he was deputy chief Cabinet secretary in the Cabinet of the late Keizo Obuchi. The money, it is reported, may have been a reward for his effort to help establish a technical university for small business. Mr. Nukaga has denied taking any bribe, saying that one of his secretaries received the money but returned it later. That sounds like a lame excuse. He has said nothing about why KSD gave him such a large amount of cash.

It is difficult not to suspect his involvement with KSD, considering that a Diet policy speech delivered by Obuchi in January 2000 made a specific reference in favor of the “technical university” project. It may be that part of the money was given for his accepting a KSD request to mention the project in the speech and the rest for his successfully meeting that request.

A prime minister’s policy speech to the Diet spells out his administration’s basic views and his policy stances on the domestic and international situation. So, referring to a private university that has not received the official green light is quite unusual. That the Obuchi speech actually did so suggests that some political pressure was at work. Hence the suspicion that Mr. Nukaga — or someone else who was in a position to check the draft speech — inserted the statement in question.

During a parliamentary exchange Mr. Koyama took up the university project, apparently at the request of KSD. His and Mr. Nukaga’s alleged ties to KSD, a public-interest body established to promote small-business interests, appear to be the tip of the iceberg. For one thing, the scandal is said to involve several hundreds of millions of yen in unaccounted funds. In addition, the group allegedly gave monetary gifts to various politicians, not just Liberal Democrats, at election time and purchased large numbers of tickets for their fundraisers.

The KSD scandal, coming at a time when the political parties have vowed to clean up politics, is likely to increase public cynicism. In the past, every time a scandal broke out, politicians pledged to reform, but a fresh scandal would erupt even before memories of the last one faded. Legislative measures were put in place to stamp out corruption, but so far they seem to have had little effect. The latest scandal is a dire warning: The public’s trust in politics could be lost for good unless parties and politicians get their act together.

The Diet, which unwittingly provided a stage for the scandal, must bring out the truth and regain its authority and prestige. Testimony by witnesses, now being demanded by both ruling and opposition parties, is unavoidable. Hard-hitting and detailed questions must be asked. Theatrics or attempts to go through the motions will only disappoint the people.

Mr. Mori and his aides say that at the time of December’s Cabinet reshuffle they knew nothing about the alleged ties between Mr. Nukaga and KSD. Even if Mr. Mori had no knowledge of Mr. Nukaga’s past doings, he cannot escape responsibility as the man who picked Mr. Nukaga as a member of his Cabinet. Instead of keeping it under the rug, the prime minister should move to clear up the whole scandal.

There is another scandal unfolding, one that involves a ranking Foreign Ministry official who is accused of stealing money from the ministry’s diplomatic secret fund. If this spreads and involves the Cabinet Secretariat, which is said to have its own secret war chest, the prime minister’s residence itself could be seen as a hotbed of political corruption. Mr. Mori now seems to face his most serious crisis since taking office.

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