UPDATE 2-Japan PM woes persist before vote; party in disarray

(For more stories on Japanese politics, click [ID:nPOLJP]

* Japan ruling bloc votes down non-confidence vote against PM

* Calls to oust PM Aso persist within party

* Ruling bloc set for defeat in Aug. 30 national election

By Chisa Fujioka

TOKYO, July 14 (Reuters) - Japan's ruling bloc voted down a no-confidence motion against embattled Prime Minister Taro Aso on Tuesday, but chaos deepened within his party as fears grew of a historic defeat in a national election next month.

A loss for Aso's coalition in the Aug. 30 general election would end half a century of nearly unbroken rule by the pro-business ruling Liberal Democratic Party (LDP), struggling to revive the economy with massive stimulus spending.

The LDP's woes have raised the chances of the opposition Democratic Party taking control of the lower house and breaking policy deadlocks in parliament, where opposition parties already control the upper chamber and can delay bills. [ID:nT220094]

The Democrats, trying to make the most of the LDP's falling popularity before the election, submitted a no-confidence motion in the lower house against Aso's cabinet by criticising its economic policies.

"The cabinet has been spending large amounts of money for the economy but we can only think that it was aimed at winning support for the election," said Democratic Party leader Yukio Hatoyama. "The measures won't improve people's livelihoods."

As expected, the motion was rejected by the ruling bloc's majority, although a non-binding but embarrassing censure motion against Aso was adopted by the opposition-controlled upper house. The Democrats plan to boycott debate in parliament before Aso dissolves the lower house early next week.

The Democrats hoped that by forcing LDP lawmakers to back Aso, it would make it harder for his critics in the party to persist in trying to dump him ahead of the election.

Alarmed by falling public support for Aso, lawmakers in the long-ruling party have openly called for him to quit ahead of the election and bring forward a vote for the party leadership set for September.

For a graphic on the parties in Japan's parliament click:

here

PARTY DISARRAY