The current crisis complicates politics for the simple reason that no side feels that it has lost. This isn't a win-win, all sides are smug, their ambitions are stoked, and they are even more unwilling to make any concessions.
This has actually been a problem right since the 12-point deal. The king got dumped. But besides that, no actor has had to relent on its fundamental interest and offer concessions.
The army, after a temporary cooling-off period, was rehabilitated and its privileges protected. For GPK, April 2006 was a moment to take over the state apparatus and keep the seat warm for his daughter while protecting the interests of the NC class base. The Maoists saw the entire process, and the polls, as a tactical victory on way to total state control.
In the last fortnight, the positions are even more retrenched. The army's political role and links and divisions may have been exposed, but the generals feel they have won a huge victory and will be even less amenable to civilian control. The Maoists may not have succeeded in throwing out Katawal, but they feel they have won a moral victory by resigning and are complacent that the political stalemate cannot be resolved without them.
UML and MJF think this is their chance to lead the government. And NC is already thrilled at the windfall from ministries it will get to control.
It is a striking paradox that at a time when there is a sense of crisis, all political actors actually think they have won, the others have lost and can be weakened further.
Translate this mood into negotiations on government formation. The UML is hoping to get rewarded for foiling Maoist plans on army. The NC is happy to see the left take on the ultra-left. Other key players feel that the Maoists have got a bloody nose and should be kept out in the opposition, even as efforts to provoke, weaken, and divide them take root.
After three days of playing victim, the Maoists are back in the game to form the government. The resources and patronage dispensation opportunities are just too tempting. They have told Upendra Yadav, finally back from his holiday, that they may possibly back him as PM while retaining control from outside.
The 'we have not lost' sentiment impacts on integration, too. The Nepal Army has become more secure because it now knows for sure that India will not allow a Maoist takeover of the army. This confidence could either encourage them to become more open to integration, or it could make them adopt an even more hardline stand opposing it. After the video tape revelations, the latter seems more likely. Lack of progress on integration will split the Maoist leadership and weaken them.
The Maoists have become even more acutely aware of the need for integration as a means to take control of the army. Even though it is difficult to see how others can ever accept unit-wise entry with space in the command structure, the Maoists will not give up on that plan easily.
They may prefer to continue the cantonment arrangement than, in their terminology, 'surrender' their cadre to the army as fodder. As the resignation showed, they are playing a long-term game.
This is not to say that if there was a clear winner or loser in the recent crisis, things would have been simpler. On the contrary, it would have invited a conflict: either an army reaction of some sort or Maoist dogmatists pushing their adventurism.
Nepal's political dynamics, and socio-economic structure, dictates that there has to be a multi-class compact. There is no short cut to reconciling myriad interests. That was the sprit of the peace process which has got waylaid with the latest crisis.
The Maoists would do well to realise this and curtail their excessive ambitions. PKD should use this moment of enormous popularity within the party to drive home the need for consensus. The other parties would do themselves a great favour by not letting fear and insecurity dictate all their actions. They will also need to be prepared to give up some key interests and privileges.
Unlikely as it is, this is the best-case scenario one can hope from last week's drama.