Japan PM job in danger as voter ratings fall

TOKYO (Reuters) - Japanese Prime Minister Taro Aso's plummeting voter support is sparking open talk in his party of replacing the unpopular leader ahead of an election this year, but lawmakers differed on when he should go.

Aso, his public support in tatters after policy flip-flops and gaffes, took a potentially lethal hit on Tuesday when Finance Minister Shoichi Nakagawa, a close ally, resigned after he was forced to deny he was drunk at a G7 news conference in Rome.

The fiasco has sparked speculation that Aso may be dumped ahead of a election that his conservative Liberal Democratic Party (LDP) looks increasingly likely to lose.

That would end more than half a century of almost unbroken LDP rule and bring to power the untested opposition Democratic Party of Japan, a mix of former LDP members, ex-socialists and younger conservatives.

An election must be held by October.

"Most people are thinking that we cannot fight an election under Aso," LDP upper house lawmaker Ichita Yamamoto, an outspoken critic of the premier, told a TV broadcaster.

But with the public growing weary of the parade of premiers -- Aso is the third since the last election -- replacing the leader "is not so easy," Yamamoto added.

The political turmoil comes as Japan's economy is shrinking at an alarming pace, and some LDP lawmakers stressed that battling the recession should be the top priority.

LDP lawmaker Yasuhisa Shiozaki, 58, a former chief cabinet secretary and ex-central banker, said current spending plans that include a record 88.5 trillion yen ($960 billion) budget for the year from April 1 were not enough. He urged the government to craft an extra 30 trillion yen budget for 2009/10.

"Enacting that is the top priority. We are not in a situation where we should change the prime minister or have an election. If we change the prime minister, there would be a blank," Shiozaki, an Aso critic, told Reuters in an interview.

PRE-SUMMIT EXIT?

Yuji Tsushima, 79, head of the LDP's tax panel, echoed the stress on economic steps. "We are not at a stage where we should be playing a blame game," he told reporters. "We need to first pass the budget, or else we can't do anything for the people."

The LDP tapped Aso, 68, last September in hopes the outspoken nationalist could lead them to victory in an election that must be held by October. Instead, his ratings have plummeted.

A poll by Kyodo news agency published on Wednesday, the first survey since Nakagawa quit, showed support for Aso at 13.4 percent, a 4.7 point drop in just 10 days. A TV poll on Sunday showed backing for Aso at mere 9.7 percent.

One LDP lawmaker, Masazumi Gotoda, 39, said Aso should step down before a Group of Eight (G8) summit in Italy in July. "I would like the prime minister to decide his fate himself," he told Kyodo news agency.

"The summit is not a school graduation trip," he added. "A person who can discuss Japan's future should attend."

Cracks have already appeared in the once mighty LDP.

One high-profile LDP lawmaker, former financial services minister Yoshimi Watanabe, bolted the party last month and has not ruled out forming a new party down the road, a movement that could gain momentum as an election approaches.

Popular former prime minister Junichiro Koizumi sparked talk of a further revolt when he said last week he opposed using the ruling bloc's two-thirds lower house majority to enact a bill to fund an unpopular plan to give payouts to individuals worth a total of 2 trillion yen.

Koizumi told reporters in Moscow, where he is visiting, that he would absent himself from a vote on the legislation, but Shiozaki said the number of rebels would be few. "There may be a few who vote against it, but it's hard for people who voted for the bill in the first place to now vote against it," he said.

(Additional reporting by Yoko Kubota; Editing by Bill Tarrant)