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The Aso Cabinet is in a state of confusion over the question of whether Mr. Yoshifumi Nishikawa should stay on as president of Japan Post Holding Co. While Prime Minister Taro Aso is believed to support the retention of Mr. Nishikawa, Internal Affairs and Communications Minister Kunio Hatoyama firmly opposes it.

Mr. Hatoyama got angry with Japan Post over its plan to sell 70 Kampo no Yado inns and nine housing facilities to a subsidiary of leasing company Orix Corp. for ¥10.9 billion — about one-twentieth the original investment. Then a scandal surfaced in which Japan Post failed to prevent some firms from mailing direct mail catalogs at postal fees discounted for disabled people’s organizations. Still, Japan Post group registered a ¥422.7 billion profit in fiscal 2008, and Japan Post directors are expected to propose retaining Mr. Nishikawa as president at the June 29 shareholders’ meeting. Representing the government as the sole shareholder of the company, a Finance Ministry official will attend that meeting.

Mr. Hatoyama has made it clear that if Mr. Nishikawa is retained as president, he will invoke his authority to rescind the decision. That would lead to Cabinet disunity as his decision would run counter to Finance Minister Kaoru Yosano’s intention.

Behind Mr. Hatoyama’s stubborn attitude may be the undercurrent of opposition to the postal service privatization that exists among some Liberal Democratic Party politicians. In February, Mr. Aso himself disclosed that he was originally against the privatization plan first pushed by then Prime Minister Junichiro Koizumi.

The fact that Mr. Hatoyama led a group of LDP lawmakers who supported Mr. Aso in the LDP presidential election could be a headache for Mr. Aso. To resolve the confusion in the Cabinet, Mr. Aso must make a difficult decision. As prime minister, he also should make clear his policy toward Japan Post. If he blunders, he will likely find himself in hot water.

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