Japan PM under pressure as ex-minister quits

TOKYO (Reuters) - A reform-minded former cabinet minister quit Japan's ruling party on Tuesday in a sign that unpopular Prime Minister Taro Aso's grip over his Liberal Democrats has weakened further ahead of an election this year.

With public support ratings below 20 percent, Aso is struggling to exert leadership in the face of an emboldened opposition, which controls parliament's upper house and has threatened to stall bills in a bid to force an early election.

Aso, 68, has ruled out a snap poll, but Yoshimi Watanabe, an ex-financial services minister, and other lawmakers in the Liberal Democratic Party (LDP) are turning up the heat as anxiety grows within the party that it could lose power after more than 50 years of near-unbroken rule.

Watanabe, who has accused Aso of being too slow in responding to a deepening recession, handed in his resignation from the LDP after his calls for an early election and other policy demands were ignored.

"Aso's government has become so out of touch with the people, that we need a change fast," said Watanabe, an outspoken advocate of reforms in the bureaucracy.

Watanabe later joined opposition parties in walking out on a vote for a second extra budget and related bills in the lower house. One other young LDP lawmaker also left the chamber.

The second extra budget, along with another extra budget for the year to March and a record 88.5 trillion yen ($990 billion) budget for the fiscal year starting in April, will finance 12 trillion yen in fiscal stimulus programs.

The bills are next headed for the upper house, where opposition parties are expected to put up a fight.

"Deliberations won't start so easily and they won't proceed," said Kenji Yamaoka, an executive of the main opposition Democratic Party.

In a poll by public broadcaster NHK, 25 percent saw Ichiro Ozawa, head of the Democrats, as most suitable to be prime minister. That was twice as many as those who picked Aso, but more than half chose neither.

FURTHER PRESSURE?

The budget could be approved by the lower house even without a vote by the upper chamber, but related bills would ultimately need approval by a two-thirds majority of the lower house to take effect.

Speculation had mounted that a group of LDP lawmakers, led by Watanabe, could join forces with the opposition to block bills in parliament and put further pressure on Aso's government.

But analysts doubt Watanabe would be able to attract a big enough following for now to rob the ruling coalition of its current two-thirds majority in the lower house.

"Watanabe is in a position to win the next election without the LDP, but for other lawmakers, their chances of winning won't improve even if they left the party," said Sadafumi Kawato, professor of political science at Tohoku University.

Aso's weak ratings have showed little sign of reversal, with media criticizing him for dodging questions over whether he would accept $220 as part of the payout plan aimed at lifting spending.

Aso, the cabinet's second richest member and who has come under fire for spending too much time socializing in upscale hotel bars, has said wealthy people should not take the money.

On Monday, he tried to reach out to the public with an appearance on a popular news program featuring footage of him relaxing in a turtleneck in his study, singing to Simon and Garfunkel's "Bridge Over Troubled Water."

(Additional reporting by Linda Sieg, Yoko Nishikawa, Editing by Dean Yates)