Party Elder To Be Japan's New Premier

Leadership, he said Sunday night, will emerge slowly from his ability "to steadily and faithfully respond to the people's expectations. It might take time, but I would like to do my best to regain the public's trust."

Quietly confident in manner, Fukuda is the son of a former prime minister and was a secretary in his father's administration.

It sometimes seems that nearly everyone in Japan who aspires to be prime minister has kin who already held the job. Abe is the grandson of a prime minister, and Fukuda's only opponent for the LDP leadership was Taro Aso, the grandson of one prime minister and son-in-law of another.

While blue blood seems to grease one's passage to the top ranks of the LDP, it is unlikely to help Fukuda solve Japan's profound economic and demographic challenges.

The traditional rural base of the LDP has largely missed out on the nation's economic recovery over the past five years, and Fukuda is promising to "thoroughly" address the needs of hard-pressed people in the countryside.

This could involve a resumption of costly but questionable public works projects that in the past have secured his party's overwhelming support outside major cities.

Increased spending would likely require a sales tax increase, which Fukuda has said he may support. It could also hobble efforts to reduce Japan's gargantuan deficit.

Hanging over the government is an even more unwieldy problem -- a demographic calamity driven by aging and low birth rates. U.N. forecasts say the country's population of 127 million could shrink by 25 million by 2050.

For Japan to maintain its high standard of living and preserve its position as the world's second-largest economy, after the United States, analysts say it needs to invest heavily in reforms to increase economic productivity -- and not in more pork-barrel spending in the boondocks.

The LDP, which since the end of World War II has governed Japan as a virtual one-party state for all but nine months, faces another daunting challenge in coming months: a combative opposition party with substantial public support.

The opposition Democratic Party of Japan, which won control of the upper house of parliament in July, is trying to force early elections for the lower house.

By law, Fukuda can serve out the remainder of Abe's term, which ends in the fall of 2009. But if the LDP continues to struggle for public support -- Abe's popularity had dipped to under 30 percent -- early elections are considered possible.

Analysts say the Democratic Party of Japan is seeking to force elections next spring, when parliament must approve a new budget.

To precipitate continued political turmoil and demonstrate the LDP's weakness, the head of the Democratic Party, Ichiro Ozawa, has vowed to kill an Abe-backed anti-terrorism law. It authorizes a refueling operation in the Indian Ocean, which has been Japan's primary contribution to U.S.-led military operations in Afghanistan. The Bush administration and several other countries have urged Japan to continue to supply free fuel to their warships.

As part of Japan's global responsibilities, Fukuda has said he wants to continue the fueling operation and that he will try to win Ozawa's cooperation in making it happen.

But the opposition leader has said little to suggest that he is interested a making a deal that would help the LDP repair its damaged reputation.

Special correspondent Akiko Yamamoto contributed to this report.