On July 4, Prime Minister Yoshiro Mori launched his new coalition Cabinet consisting of the Liberal Democratic Party, New Komeito and the New Conservative Party. The event, following the June 25 general election, would have been an occasion for celebration and hope under ordinary circumstances but was greeted with severe criticism at home and abroad. Some pundits predicted that the administration would last for five months at most, citing the following reasons:

First, the LDP won only 233 seats in the 480-seat Lower House in the election, far short of the majority of 241 and down 38 from its pre-election strength of 271. New Komeito won only 31 seats and the New Conservative Party seven, both down 11 from their pre-election strength. The three coalition partners managed to retain a total of 271 seats but saw their combined strength decrease by 60. New Komeito, whose setback is widely blamed on its campaign cooperation with the LDP, is unhappy with the election results and is moving to distance itself from the coalition.

Second, some LDP lawmakers are sharply critical of Mori for making a series of inept remarks and for demonstrating little leadership during the campaign. In addition, they blame LDP Secretary General Hiromu Nonaka for the disastrous election setback the party suffered in urban areas. Young LDP politicians formed a group July 5 to criticize the party's old guard. The LDP leadership under Mori and Nonaka faces strong criticism from within and outside the party.