By Jonathan Day

    TOKYO, Sept. 17 (Xinhua) -- Yukio Hatoyama in his first full day in office as leader of the newly elected Democratic Party of Japan (DPJ) vowed that his cabinet will deliver on policies to swiftly reenergize Japan's sluggish economy.

    Following a monumental poll victory last month that brought an end to half a century of Liberal Democratic Party rule, Hatoyama and his largely untested cabinet are now challenged with rescuing the world's second largest economy.

    In a recent news conference the new Japanese premier stated that he was "very excited about being on the verge of creating history" and felt "a great responsibility to the people of Japan."

    He went on to tell reporters that his government will work tirelessly to establish an administration that will change the course of the nation by releasing Japan from its former bureaucratic stranglehold and hand the power back to the people through wholesale domestic and foreign policy reforms.

    Under the rule of the ousted Liberal Democratic Party, Japan has suffered decades of governance largely controlled by powerful bureaucrats, excessive government spending, inadequate social welfare provisions for an increasingly aging population and foreign policies that failed to safeguard Japan's export-driven economy.

    However, in the face of concerns as to whether such an inexperienced party can deliver the new era of change they promise, Hatoyama's cabinet has announced its basic plans for extensive political reform, as well as its provisional domestic and foreign policy strategies aimed at hugely impacting the private sector and breathing new life into the nation's ailing economy.

    Such plans include increased cooperation and transparency between governmental departments (formally renown for their cloistered traits) and a parting of ways with the bureaucrats who controlled the nation's finances.

    Hatoyama has maintained that this will be achieved by the creation of a new strategy bureau. The new bureau, far from operating with the autonomy afforded to previous administrators, will work in close alliance with the new prime minister’s office to draw up the national budget.

    Hiroshisa Fujii, the newly appointed Finance Minister and Masayuki Naoshima, the Minister for Economy, Trade and Industry have both been quick to expound plans to cut and redirect what Mr Fujii described as, "wasteful government spending." Funds previously allocated for numerous and costly government sponsored construction projects, for example, will be redirected into the DPJ initiatives to subsidize the development of environmentally friendly technologies.

    GREEN TEAM

    By 2020 the DJP has set itself the onerous task of slashing the country's carbon emissions by a staggering 25 percent -- a benchmark well received by homegrown companies such as Toyota, Toshiba and Sharp whose well established green technologies will ensure further hefty government endowments and a return to proliferation upon the DJP's predicted upturn in consumer spending and exports.

    However as much as such plans will undoubtedly benefit Japan's eco-tech companies, the unsung heavy industry and construction firms that literally raised Japan from the dead in the postwar era, may well be facing further times of adversity, failing prudent government intercession.

    The concerns voiced by business leaders regarding the DJP's emissions reduction proposal, may well be valid. Such stringent directives, whilst potentially addressing unemployment woes by creating new jobs in eco-tech sectors, may inhibit growth and development in other areas of commerce.

    Add to this the actual cost involved in achieving a 25 percent reduction in carbon emissions in just over a decade and the rumblings already coming from certain business and political camps about exactly how Mr Hatoyama's party plans to achieve their environmental target, are perhaps of no surprise.

    Tadashi Okamura, the chairman of the Japan Chamber of Commerce and Industry, in a statement to the media, said: "Although the emissions reduction proposal could increase employment through the economic effects of further development and growth of environmentally-friendly products, the plan would also involve large costs."

    "it is wrong to solely focus on negative aspects or the financing of such a radical reduction target, but the Democratic Party must clarify an achievable path towards attaining it," he added.

    SPENDING SPUR

    The DPJ is also laying down plans to stimulate the economy by putting in place initiatives to boost consumer spending with the introduction of minimum monthly pension of 70,000 yen, the removal of state high school tuition fees (approximately 120,000 yen per year) and a monthly allowance of 26,000 yen for parents for every child up to the age of 15.

    This "cash-for-kids" scheme is also aimed at addressing Japan's rapidly declining birthrate -- a situation that has grave economic implications for Japan's future, with its rapidly aging population and workforce.

    Further strategies to increase social spending by providing people with more financial security include reducing taxes and fees, which, although a good idea in theory, is something of a double-edged sword.

    The DPJs plan's to halve the tax on gasoline and phase out highway tolls, which on the one hand will be well received by Japan's automakers who can expect an increase in domestic demand, but this could severely impact Japan's public transportation industry and create further environmental obstacles for the DPJ to deal with.

    COMMUNITY SPIRIT

    Prime Minister Yukio Hatoyama has said he plans to create what he described as an "East Asian Community" to primarily address issues of reciprocal trade benefits, but also those of national security.

    The DPJ hopes to achieve this community through forging stronger, more trustworthy ties with neighboring Asian countries, particularly China and South Korea -- the former of which is reaping the benefits of a number of bilateral free trade agreements which has led to a proliferation in the nation's global supply chains over the past decade.

    Asian economies will provide the world with most of its growth this year, and analysts are confident that Asia will continue to be the world's fastest-growing region for several years to come.

    The DPJ is looking to break its passive stance to bilateral ties with the United States, without excluding or compromising on a "frank and trusting relationship," in favor of a more independent position that would enable Japan to facilitate an increased demand for its major exports, primarily from Chinese, but also from South Korean consumers.

    The DPJ's creation of a state-funded safety net will take the pressure of Japanese companies to provide lifelong social safeguards against economic turbulence and provide Japan's new government with increased confidence to embrace deregulation over protectionism and surge forward.

    However the world will be watching closely in the weeks and months to come to see if Prime Minister Yukio Hatoyama, in contrast to a number of his predecessors, has the strength, aptitude and leadership skills to not just implement, but to carry through his party's new economic, social and climate policies, through to prosperous fruition.

    In the meantime Mr Hatoyama has called on the Japanese public to show "patience and understanding" toward the new government, in this time of monumental transition.