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Japan braces for possible new leader ahead of party vote amid spat with China, economic woes

TOKYO (AP) — Japan braced for yet another new leader ahead of Tuesday's ruling party vote that pits the prime minister against a veteran lawmaker known as a backroom powerbroker. The race comes amid an escalating diplomatic spat with China and a surging yen that is battering the country's vital exporters.

Prime Minister Naoto Kan appeared to have a slight edge over party kingpin Ichiro Ozawa ahead of the internal Democratic Party of Japan election. If Ozawa wins, he would become the country's third prime minister in a year and sixth new leader in four years, perpetuating Japan's leadership merry-go-round.

Both men have stressed the need to revive Japan's sluggish economy, which has fallen behind China's and is now the world's third-biggest. Ozawa favors more stimulus spending and has suggested that Japan needs to intervene in the currency market to reverse the yen's recent spike to 15-year highs.

Kan, in office just three months, has stressed the need to create more jobs while cutting wasteful programs and maintaining fiscal discipline.

Whoever wins also must deal with an increasingly assertive China, who has blasted Japan for arresting the captain of Japanese fishing boat that collided with two Japanese patrol boats near disputed islands in the East China Sea.

Opinion surveys show that Kan is preferred by the public by a 4-to-1 margin over Ozawa, a gruff "shadow shogun" who wields a great deal of power behind the scenes. Ozawa has championed various reforms, such as deregulation and reining in Japan's powerful bureaucrats.

The leadership decision will be made by party members, not the public. Tuesday's vote by 411 Democratic members of parliament will account for about two-thirds of the tally. Rank-and-file party members around the country, which account for the remaining third, cast their ballots Saturday.

Because of the Democrats' clout in parliament, their leader will automatically become the prime minister.

Ozawa, a fixture in Japanese politics for 40 years, was widely considered a potential prime minister until a scandal forced him to resign from party leadership positions.

But now the 68-year-old is back, saying he stakes his political career on the vote, although he still could be indicted as early as next month on charges of political funding irregularities — which has hardly helped his image.

Author of the 1993 best-seller "Blueprint for a New Japan," Ozawa argues that Japan should be able to stand up for its own interests. He's widely seen as wanting Japan to be more assertive in its ties with the U.S. while also strengthening its relationship with neighbor and rising power China.

He's also suggested re-opening talks with Washington over a plan to move a controversial Marine base to another part of Okinawa, citing vehement opposition of local residents.

"For Japan to be just following the American line without hedging its bets and without investing more in its relationship with Asian neighbors, beginning with China, Ozawa thinks is silly," said Koichi Nakano, a political science professor at Sophia University in Tokyo.

But if Ozawa wins, "he is going to have to become more diplomatic and reassure the Americans that trying to build a better relationship with China is not at the expense of U.S.-Japan relations," Nakano added.

Kan, 63, who gained prominence in the 1990s for exposing a government cover-up of HIV-tainted blood, has a cleaner image than Ozawa and enjoys stronger support among regular party members and local lawmakers.

But Kan is also seen as a less forceful and influential politician than Ozawa, and party members blame Kan for the Democrats' loss in July's upper house elections because he proposed before the vote that Japan raise its sales tax.

Ozawa, has deep support in parliament, where many are beholden to him for helping start their political careers. He is widely credited with orchestrating the Democrats' landslide victory last year, which overthrew the long-ruling conservative Liberal Democratic Party.

Still, scandal has dogged him, and he could be indicted next month by a citizen's panel on politcal funding irregularities. He says he has done no wrong. If he is prime minister, Ozawa would have constitutional immunity, but he has said he would not "run away" from any allegations.

A bit of a loose cannon, Ozawa also recently called Americans "simple-minded," and late last year said Christianity is an "exclusive" religion that is weighing down Western society.