Thai Prime Minister Yingluck Shinawatra’s government has had a bad couple of months, capped by a fiasco in which public protest doomed a proposed amnesty for her brother, the fugitive former Prime Minister Thaksin Shinawatra.

What’s more, the clumsy attempt to deliver the pardon appears to have awakened the so-far dormant People’s Alliance for Democracy, the so-called Yellow Shirts who were responsible for months of political chaos in the capital of Bangkok ion 2009, and who have been waiting for a pretext to reappear.

Yingluck’s Pheu Thai-led government has already been under considerable fire for its handling of the 50-year flood that inundated much of central Thailand under two meters of water, killing more than 600 people. Opponents have charged that the government has been inconsistent, delivering conflicting decisions and being unable to deal with the floods. There have been allegations of corruption in the delivery of aid. Ministers have repeatedly appeared on television to apologize for their decisions, which critics have charged is a subterfuge to deflect criticism from the prime minister

In particular, the Democrats, who control metropolitan Bangkok from the opposition, have been attempting to undermine the neophyte prime minister’s credibility. The government compounded the problem by turning floodwaters away from central Bangkok into rural areas surrounding the capital. Ironically, the flooded areas are mostly those where Thaksin’s poor rural supporters live, while central Bangkok is controlled by the opposition.

While there have been periodic calls for Yingluck to step down, especially after she was caught by a photographer in tears in an airplane doorway, there is no indication at this point that the government is in any particular danger. Nonetheless, whatever momentum Pheu Thai had built up prior to the floods appears to be lost. The next big test, assuming the Yellow Shirts remain at least semi-quiescent, will be the Bangkok governorship election, which will occur in 2012.

The floods have knocked Thailand’s full-year 2011 growth down to a projected 2.4 percent after strong 8.1 percent first-quarter growth, according to the World Bank’s report on Southeast Asia which was released today, with production losses reported across the entire region because of the hundreds of flooded factories on the Ayutthaya plain. Perhaps as many as 1 million people have been put out of work. That disaster is expected to be compounded by the persistent global economic downturn, which shows no sign of ending. Government construction spending, which plays a major role in total construction expenditure, is off 30 percent.

Against those figures, the government has instituted a populist program that includes a Bt300 per day minimum wage, cuts in corporate taxes from 30 percent to 23 percent, a 40 to 60 percent raise in the intervention price for rice and other growth incentives. Reconstruction spending for the flood-hit factories should also provide a lift to gross domestic product,

The attempted pardon was reportedly included among a list to be presented to King Bhumibol Adulyadej to consider for the ailing monarch’s 84th birthday on Dec. 5 and was to be applied to all individuals over the age of 60 who were sentenced to less than three years in prison. The request allowing for the pardon appeared to have been specifically tailored to benefit the 62-year-old Thaksin, who was given a two-year jail sentence on corruption charges over the sale of real estate. The pardon list normally doesn’t include fugitives.

Although many analysts in Bangkok say Thaksin should wait for the political situation to cool, the former premier has continually pushed for a large role in Thailand’s affairs through his sister, whom he installed to head the Pheu Thai Party which now leads the government coalition. That has kept the Yellow Shirts wary.

As word spread of the proposed pardon, engineered by Deputy Prime Minister Chalerm Yubamrung, restive opponents of the Pheu Thai government raised protest. Ultimately, the government was forced to back away from the attempt against the threat of street demonstrations. Some 1,000 protesters gathered in Bangkok on Friday to demand that his name be removed from the pardon list.

"Thaksin will not receive any benefit from the [royal] decree, and his name will not be included on the list of convicts eligible for a royal pardon," Justice Minister Pracha Promnok said on Nov. 21, indicating the list would be rewritten by the government to delete Thaksin's name.

"Convicts on the run will not be eligible," Pracha told local reporters. "The new draft will not benefit anyone in particular, especially Thaksin, because those who are eligible for a royal pardon must have served [a portion of] their jail terms first."

Thaksin has continued to dispute his conviction, charging that it was engineered for political reasons after he was deposed as prime minister in 2006. He chose to flee the country in 2008 in the face of a two-year jail sentence and forfeiture of US$1.2 billion of his fortune. He ended up in Dubai, where he has continued to machinate new stratagems for his return.

The government has clearly lost the momentum it had achieved before the floods by seeking rapprochement with the military and the royalist elements. Yingluck reportedly has carefully deferred to the king and the Privy Council in all situations. The draconian lèse-majesté laws that have resulted in the jailing of any and all critics of the royalty have not been repealed. Leaders of the Red Shirt demonstrators remain in jail. A truth and reconciliation commission has made little or no headway in resolving the questions over the killing of 91 people, most of them protesters, in May of 2010 in Bangkok.

The floods have allowed military to rebuild its image after it delivered the crackdown on the 2010 protesters. They have been photographed conspicuously taking the lead in evacuating flooded regions and delivering aid, some of them wearing uniforms with the word’s “King’s Guard” while conducting rescue operations. They have been the de facto rulers of the country most of the time since a 1932 coup that took away the absolute power of the monarchy. They appear to be taking back some of that authority. A Pheu Thai plan to establish greater civilian control over the military is probably not in the cards. It is equally unlikely that any military officers will be held accountable for the shooting of the protesters in 2010.