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Aso confirmed as Japan's new PM

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  • Taro Aso, an outspoken former foreign minister, is Japan's new prime minister
  • Sagging economy tops challenges facing Aso
  • He favors cutting taxes and increasing public spending
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TOKYO, Japan (CNN) -- Taro Aso, an outspoken politician and a former foreign minister, became Japan's new prime minister Wednesday after the powerful lower house of parliament overruled the upper house's choice for a leader.

Aso handily won the vote in the lower house, where his ruling Liberal Democratic Party holds the majority.

The upper house had voted in favor of opposition leader Ichiro Ozawa.

Under Japan's constitution, though, the lower house overrules the upper one when the two cannot reach consensus.

Aso, 68, was officially declared the prime minister after a meeting between representatives from the two bodies.

Soon afterward, he named his new Cabinet.

U.S. President George Bush called Aso Wednesday morning to "congratulate him on his election as prime minister and to reaffirm the strength of the U.S.-Japan alliance," said National Security Council spokesman Gordon Johndroe in Washington.

"The president said he looks forward to seeing the prime minister in Lima (Peru) at the APEC Summit" in November, Johndroe added.

Aso succeeds Yasuo Fukuda, who resigned amid plummeting approval ratings after less than a year in office. Fukuda and his Cabinet stepped down ahead of Wednesday's vote.

The new prime minister inherits an office that is expected to confront 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 party 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 one 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.

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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's Junko Ogura in Tokyo contributed to this story.

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