Japan's PM Fukuda resigns; Aso in the wings

TOKYO, Japan (CNN) -- Japanese Prime Minister Yasuo Fukuda has formally resigned, making way for Taro Aso, the newly elected leader of the ruling party, to fill the post.

A special parliamentary session was under way Wednesday to vote for a new prime minister, widely expected to be Aso, an outspoken politician and a former foreign minister chosen Monday as the Liberal Democratic Party's leader. The party holds the majority in the lower house of Parliament.

Fukuda announced his resignation on September 1 after being in office for less than a year. Fukuda and his entire cabinet stepped down on Tuesday, his office confirmed.

Even though a record five candidates ran for the top spot -- including, for the first time, a woman -- the other four candidates united around Aso in the waning days of the campaign, as polls showed he would win handily.

If Aso wins the prime minister's slot, he will inherit an office that is expected to tackle several pressing challenges immediately.

Foremost among them is the country's sagging economy. Aso advocates an increase in public spending and tax cuts to stimulate the economy.

The LDP is also expected to call a snap election as early as next month in hopes that Aso's name-recognition will help the ruling party retain control of Parliament.

But the tactic can backfire, analysts say. The LDP is in the midst of a political crisis. The last two prime ministers, both from the party, resigned after less than a year in office.

Because of the turmoil within the LDP, the opposition party, the Democratic Party of Japan, senses a shift in political tides. A snap election could see a turn in political power in Parliament, after nearly half a century of continuous control by the LDP.

Aso, a former Olympic sharpshooter, is a Catholic in a country where only 1 percent of the population is of that faith. And he is also known for his verbal gaffes. He recently likened the opposition party to the Nazis.

Fukuda's popularity plummeted after he introduced a medical plan that raises premiums for people over age 75 and deducts health-care expenses from pension payments.

The government has said the plan is unavoidable in a country with one of the world's largest aging populations. Opposition parties have criticized it for its effect on one of the most vulnerable segments of society.

In June, Japan's opposition-controlled upper house of parliament approved a motion of no-confidence in Fukuda. It was the first time a chamber of parliament has passed such a censure in the country's post-war history, but the motion was non-binding and largely symbolic.

While no-confidence motions only count in Japan when approved by the LDP-controlled lower house, analysts said it was a stinging rebuke for the prime minister.

CNN Producer Junko Ogura in Tokyo contributed to this story.

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