As Stan Laurel liked to tell Oliver Hardy: “Here’s another fine mess you’ve gotten us into.” It all started with people close to President Gloria Macapagal Arroyo leaking to the press that the president was inclined to reshuffle her Cabinet, both as a means to reward and punish those who delivered or failed to produce results in the senatorial election.

At the same time, a Cabinet revamp was proposed as a means of recovering the political initiative: Fresh faces, a chance for a new image, in other words. Personally, I believe that what was also going on, behind the scenes, was a fight within the president’s official family, to determine the direction the administration would take, in the three years of constitutional life it has left.

One source put it this way: In Cabinet meetings, one group kept proposing that the way forward lay in thinking in terms of “legacy,” that is, achieving improvements in the economy so that the public will think less harshly of the president, and allow her to retire in peace in 2010. Against that group, the same source said, is another Cabinet faction that has only begun to enjoy the perks of power, and which thinks, furthermore, that it has no career prospects past 2010 unless the president herself gets an extension — and who therefore think the objective of the administration should be, to keep itself in power after its current three years are up.

Regardless of which side has the upper hand, the present administration is no different from any other, in that mid-term elections require some sort of reshuffle in the Cabinet. If morale is to be kept intact, those blamed for the defeat of the senatorial ticket of the president have to go: They didn’t deliver, and if they aren’t punished, what incentive is there for those who did perform well, to keep trying to do their best? Mrs. Arroyo has built up a reputation as a leader unafraid to reward and punish. To hold back now would be to relinquish the element of fear which has kept her supporters, thus far, in line.

So finally, last week, the changing of the guard was trumpeted. Executive Secretary Eduardo Ermita said that all patronage positions (in government-controlled corporations and so forth) would be vacated by their current office-holders; and that furthermore, the Cabinet, too, was expected to hand in their resignations. That was on a Wednesday. On Friday, Presidential Spokesman Ignacio Bunye said that no, no Cabinet members would be asked to resign.

What happened in those few, short, days between Wednesday and Friday?

Apparently Trade and Industry Secretary Peter Favila panicked: Asking all of the Cabinet to submit letters of resignation might be construed by the business community as a sign all wasn’t well with the president’s economic team. I assume that Favila believed that foreign observers, in particular, unfamiliar with the rituals of Philippine politics and the presidency, would confuse a standard post-election ritual with something more serious when it comes to the economy.

And so, local political expectations collided with playing to the foreign gallery. And the result is a fine old mess. Finance Secretary Margarito Teves had announced he would submit his resignation; Energy Secretary Raphael Lotilla handed in his; and immediately, the speculation began: Were these pro forma resignations, or signs of disenchantment? It didn’t help that a rift -whether real, or imagined — was reported between Teves and Bureau of Internal Revenue Commissioner Jose Bunag, one further complicated — as things can only get complicated in the Philippine bureaucracy — because of a presidential instruction that clipped some of Bunag’s powers. A situation that had to be reversed after a meeting held between the president, Bunag, and Teves resulted in Mrs. Arroyo rescinding her own order.

In the end, a tremendous amount of time — and political capital — was squandered, with the president gaining next to nothing in terms of strengthening public confidence or showing she’s fully in charge. She signed an order, a hurried meeting had her reverse her order; she told the press she was sick of paying political favors, and broadly hinted heads would roll because of her senatorial slate’s defeat — only for the Cabinet reshuffle to be stopped dead in its tracks, leaving a very publicly confused Cabinet saying it would comply, only to be told there was nothing to comply with. And since there was — belatedly, but apparently — no Cabinet reshuffle, there was no face-saving opportunity for tired or disillusioned Cabinet members to hand in their resignations.

So no one could resign: Perhaps that was the whole point? Favila didn’t want to give Teves a chance to rock the boat and quit? The business community can relax — but at what price?

An automatic Cabinet reshuffle in the wake of the mid-term elections, would have given the no longer useful a face-saving way out; it would also give political allies a graceful way in. But now that a reshuffle has been canceled — and crudely, mind you — anyone who goes, will do so only by being fired. A Catch-22 that ironically magnifies the consequences any Cabinet changes will have, in the business and political sense.

And it limits the payback the president can make; as well as the rewards loyalists can aspire to obtain. The demoralization in the ranks of the faithful is palpable. Two bulwarks of the administration, the Union of Local Authorities of the Philippines (ULAP) and the Governors’ League of the Philippines, are complaining in public. Eastern Samar Gov. Ben Evardone grumbled, “People deserve an honest-to-goodness housecleaning,” and that the present time — and a Cabinet revamp — were “very critical in defining the legacy that she will leave to the Filipino people.”

So you know which side the president’s loyalists in the local governments are inclined to back: The “legacy” crowd, which wants to make the best of the next three years, but thinks the president’s useful life ends in 2010. By which time they would have decided which presidential candidate to support. They think “the president should not give in to her inner circle, which has been resisting the impending reorganization of her official family,” as a news report puts it.

It sickens one group of presidential allies that space isn’t being made for their people to feed at the public trough. And they’re painting it in terms of a larger debate: Those that want the president to stay beyond 2010, and those who think she should retire when her term is up. But neither can say with certainty, whether the president herself has made up her mind. I think she likes it that way — it keeps everyone guessing.