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Hatoyama becomes leader of Japan's opposition party

JAPAN'S opposition Democratic Party picked Yukio Hatoyama, a political blueblood who has pledged to cut wasteful spending and reduce bureaucrats' clout, as leader yesterday to try to revive its chances in a looming election.

But it was unclear how much Hatoyama, who like Prime Minister Taro Aso is the wealthy grandson of a former premier, would appeal to the independent voters whose backing is vital to winning an election that must be held by October.

Opinion polls have shown the Democrats ahead of Aso's long-ruling Liberal Democratic Party (LDP), but a fundraising scandal that forced Ichiro Ozawa to step down as leader this week had narrowed the lead.

A Democratic victory would end more than five decades of almost unbroken LDP rule and raise the chances of a breakthrough in a political deadlock that has stymied policy implementation as Japan's economy struggles with its worst recession in 60 years.

Policy-making in Japan has been stalled since the opposition won control of parliament's upper house in 2007, allowing them to frustrate legislation. Without a decisive victory by either side, the chances of breaking the stalemate are slim.

Hatoyama promised to reduce the decades-old bureaucrats' control of policy, which critics say distorts spending and favors vested interests, cut waste and boost household income by giving financial support for families with children.

"To put it simply, I want matters dealt with not in the interests of bureaucrats, but of the people," he said in a debate before the party vote.

Both ruling and opposition parties see the need for public spending to boost growth in the world's No. 2 economy, so short-term implications for financial markets are not great.

Democratic lawmakers opted for Hatoyama, 62, over Katsuya Okada, 55, a policy expert with a clean image who had led in opinion polls, in the hope he can unify the sometimes fractious party while appealing to voters fed up with the LDP.

"We need a change in government. I'm voting for the Democrats and that won't change whoever is the leader," said 65-year-old taxi driver Takeo Suda.

But Hatoyama, who held the top party post from 1999-2002, is likely to come under fire as old-fashioned and too close to Ozawa.


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