The Liberal Democratic Party, which ruled Japan for over fifty years after World War II, is not actually "liberal". Rather, the party is conservative. As ANN pointed out, party members Masaaki Taira and Hideki Niwa are slated to discuss how the LDP is "seriously considering the development of Gundam."
Back in 2008, it was estimated that a working (not just a full scale mock-up like above), one-to-one scale would cost US$725,000,000 for parts and materials. That figure doesn't include the cost of labor or the cost of insanity required to build such a machine.
These politicians probably do not mean they want to make a 60-foot tall, 43.7 metric ton Gundam replica (at least I hope they don't), but instead, large mecha contraptions that could be used by, presumably, the country's Self Defense Force. In an age of drone attacks, however, mecha don't exactly seem ideal on the battlefield.
Japan's economy and society are both in a bad way. The country is deeply in debt, the population is aging, and Japan has no natural resources. And with a strong yen and a sour world economy, Japan can't export its way to prosperity. It can ship its manufacturing to China and hollow itself out.
These are serious times. They require serious conversations by serious leaders. And the LDP, who hopes to regain power after the current Democratic Party of Japan implodes, appears like its fishing for the nerd vote by appearing on Nico Nico and talking about building Gundam robots as a viable way to promote industry and protect the nation.