Until Mr, Saito's return from Washington, where he is serving as Ambassador, the Premier will take charge of the Gaimusho. He will also hold the Education portfolio, until a suitable person is selected. No mention has yet been de of the fate of the} Overseas Affairs Ministry, whose abolition is being urged by the Army.
In accepting the nominees of the Fighting Services, Gen. Hayashi Ignored: the counsel of hhis "one-man brain-trust" Mr, 8, Sago, who was mentioned for the important post of Secretary-General of the Cabinet.
Mr, Soya, who heads the Hatin Chung Kungssu, a South Manchuria Railway Ca, subsidiary engaged in the economic development of China, immediately" left Gen, Hayashl's headquarters, announcing that they
other because of "a difference had "broken all relations with each opinion."
Acting on the advice of Mr. Sago. who has always maintained close relations with the Kwantung Army, Gen. Hayashi yesterday sought the appointment of Lieut-Gen. 8. Itagaki, Chief of Staff of the Kwantung Army and the reputed leader of the "Young, Officers" faction, as his War Minister, Gen. Hayashi also. i 6 appoint Admiral N, Suetsugu, mem= the Supreme Military Council and "stormy. petrel" of the naval forees. as, his Navy Minister, would show little mercy in dealing with his predecessor's plans for tax increases, Tt was, however, generally greed that the new Treasury head [would have no alternative but to approve the appropriation of record sums for military needs as well as to continue to place main reliance Upon public borrowing.
Beonomle circles regarded it possible. that Mr. Yuki would seek to cut the ¥.3,000,000,000 budget for 1997-88 by curtailing or postponing other projected expenditures. Tt was tls thought certain that Mir, Yuki would take over Dr. E. Baba's "cheap money" policy and also the latter's plans for a siticter supervision over the nation's economy.
Text read from the printed page and cleaned; old type leaves the occasional error.