When Japan?s 77-year-old finance minister submitted his resignation on Tuesday January 5, the reason given was poor health. The week before he had been admitted to hospital complaining of exhaustion and high blood pressure after drafting the 2010 Budget.

But illness was not Hirohisa Fujii?s main problem. Instead it appears to have been a case of bad blood at the top of Hatoyama?s ruling clique. Fujii, people who have spoken to him say, grew increasingly frustrated with the power Ichiro Ozawa, secretary-general of the ruling party, had over Hatoyama, and a festering feud between the two men eventually boiled over in the Budget-drafting process.

After some hesitation, on Wednesday Hatoyama accepted Fujii?s resignation and replaced him with Naoto Kan, the deputy Prime Minister. Kan already has a wide-ranging government portfolio, but the main alternatives for finance minister were also no friends of Ozawa. That may have ruled them out.

Ozawa occupies an unparalleled position in Japanese politics. As architect of the historic victory of the Democratic Party of Japan (DPJ) in the election in August, which ended five decades of one-party rule, Hatoyama and the party believe they owe him a debt of gratitude. He is also considered crucial for delivering a big win for the party in elections for the upper house this summer.

Yet he is also widely seen as a dark presence, whose influence hardly squares with a party that came into office vowing to improve the transparency of Japanese politics. All requests to DPJ lawmakers for public-spending projects are channelled through him, and he often appears to put the party?s interests before those of the government. Recently, he has flaunted his authority by taking more than 100 DPJ lawmakers on an official and inviting them to a banquet at his home on New Year?s Day, engaging in a highly publicised dispute with the imperial household and making damning comments about Christianity. Increasingly, the ?shadow shogun?, as he is known, is stepping out into the light.

The incident that appears to have slighted the finance minister came in the midst of Budget-drafting last month. Some suggest that Ozawa single-handedly persuaded the Prime Minister to scrap a campaign promise to cut petrol taxes without Fujii?s agreement. But the hostilities date back further.

Last year Fujii led a successful campaign to stop Ozawa becoming the DPJ?s prime-ministerial candidate after it became clear his office was under investigation over a political-funding scandal. People close to him continue to be quizzed by prosecutors over funding issues; on Wednesday, the Asahi Shinbun reported that a Tokyo district court would summon Ozawa for questioning. Some believe Ozawa?s recent assertiveness may be a shot across the prosecutors? bows.

In choosing Kan as the new finance minister, Hatoyama has picked a man whose relations with Ozawa are considered neutral, but who lacks the financial experience of Fujii and at least one other of the candidates. Kan was a prominent social activist before entering politics and is a former health minister. Since the new government took office, he has been in charge of developing a long-term strategy to deal with Japan?s huge debt and other matters, and has been increasingly outspoken on the need to tackle deflation. His appointment is unlikely to destabilise Japan?s financial markets. However, it will not dispel the impression that Hatoyama is, at times, worryingly like a puppet on Ozawa?s string.

?? The Economist Newspaper Limited