SCENARIOS - Possible results and implications of Japan election

By Linda Sieg

(Reuters) - Japanese Prime Minister Taro Aso is expected to call an election for August 30, paving the way for a possible change in government after more than 50 years of almost unbroken rule by the conservative Liberal Democratic Party.

The opposition Democratic Party has vowed to pay more heed to the rights of consumers and workers than companies, keep the sales tax at 5 percent for the next four years, and wrest control of policy-making from bureaucrats as a way to cut waste.

It also wants to adopt a diplomatic stance less subservient to close security ally the United States while cultivating good ties with Asian neighbours such as China.

Following are possible outcomes of the election for the 480 seats in parliament's lower house, where Aso's LDP and its junior coalition partner, the New Komeito, now hold a combined 334 seats.

CHANGE OF GOVERNMENT, NEW COALITION

The main opposition Democratic Party looks set to either win a majority on its own or become the biggest party in the lower house and form a coalition with smaller allies, ousting the LDP from power for only the second time in its 54-year history.

Financial markets would likely welcome the prospect of a breakthrough in a long-running political stalemate but worry about the ability of the untested Democrats to govern and their possible lack of commitment to cutting Japan's huge public debt.

Even if they win a majority on their own, the Democrats need to join hands with two small parties, one conservative and one leftist, in order to keep control of parliament's upper house and break a deadlock that has stalled policy implementation as the country struggles with its worst recession in 60 years.