'Welcome to all of the hijinks and games that happen in election year'. That was John Key's declaration on breakfast TV yesterday, and nicely sums up the major political discussion of the moment: which political parties can work together to produce a new government out of this year's general election

Key has clearly positioned National in a highly-pragmatic space for negotiating with minor parties. On one level this makes his party look powerful - it has lots of potential friends and options. But it also reveals the very difficult position that National is in in terms of support parties, and his announcement can also be seen as a negative - see Tim Watkin's very good blogpost, Key's coalition list a sign of weakness for National, re-birth for Peters & Dunne.

This narrative paints a picture of desperation on National and John Key's part: 'This shows just what lengths he's willing to go to in his desire to stay Prime Minister. Because let's make no bones about it, Key will have hated opening the door to Peters. Hated it'.

National's U-turn on New Zealand First

It's the inclusion of New Zealand First on National's list of acceptable post-election partners that is garnering most interest at the moment. For the best discussion of how Key's decision came about, and what risks and advantages it might bring for his party, see Audrey Young's National accepts the risks in going back to NZ First.

The advantages for National are straight forward, says Tracy Watkins, and she doubts that National will really regard New Zealand First as the last option: 'The reality is that if National can't govern without NZ First then Peters won't so much be first cab off the rank as first stretch limo off the rank' - see: Winston may well be the stretch limo.

There are many who doubt that a National-NZ First coalition will eventuate. Even John Key pronounced it 'very unlikely'. But for Gordon Campbell, it's almost a certainty if National hopes to stay in government, and he says that despite Peters' constant attacks on National and Key, it should be viewed as mere 'pantomine' - see: On National's election fling with New Zealand First.

Campbell also speculates on the policy dimension of such a coalition: 'This apparent readiness to deal with each other post-election should begin to clarify what Key may have to give away in order to form a government, once the votes are counted. To woo Peters, Key will have to flag any attempt to make tough decisions on the eligibility age for National Superannuation. With Craig, National and the Conservatives can agree to flatten the tax scales, and deliver New Zealand a far more regressive tax system'. Ultimately, Campbell says having Peters on standby also means that National can afford to drop down close to 40% in the polls this year, and still have a realistic expectation of forming the next government'. For such reasons, satirist Scott Yorke suggests New Zealand First updates its election advertising - see: A new campaign slogan.

Someone else who will be disappointed with Key's announcement is David Farrar, who blogged last week to say that National would actually be better to go into opposition than share power with New Zealand First - see: Why John Key should rule Winston Peters out again.

For the strongest reaction against Winston Peters being involved in some way with a National Government, see Mike Hosking's Peters in the mix could be a massive mistake.

Possible configurations of power

There's now an increasing degree of clarity about which parties could work together. For this year's election, David Farrar has put together a table to illustrate this - see: 2014 Coalition Options.

But having a full coalition government is not the only option. Farrar also smartly makes The case for minority government. His essential argument is that instead of a coalition government, 'there is an alternative. That is National as the largest party forms a minority government, and it continues to govern while it can pass confidence and supply votes in the House. This would mean NZ First abstaining (or possibly voting in favour)'.

Is Winston Peters posturing about democracy?

There appears to be an increasing propensity for parties to put their cards on the table about coalition options. But this is not universal, and there's still substantial ambiguity in what John Key has said so far, and David Cunliffe is also rather vague on potential configurations with coalition partners. Crucially, he still isn't willing to rule the Greens in, or even say whether he would work with the Internet Party - watch and read TV3's Election year battlelines drawn.

The major hold-out is Winston Peters, who has made some incredibly strong statements deploring political parties such as National for making their coalition intentions clearer - see, for example, TVNZ's Engineering election results an insult - Peters.

For the strongest refutation of Peters' views about coalition negotiations and his view that voters are treated poorly by parties indicating who they can work with, see the Herald's editorial, Voters need to know before vote. See also, Michael Cummings' Peters 'forgets' his own history.

Finally, with numerous 'boutique political parties' emerging, yet another satirist muses about establishing her own version, and wonders if it's a prerequisite to be 'investigated for some kind of criminal offence' - see Michele A'Court's Logical Conclusion Party.