I'm a little frustrated with the continued failure for action in Libya. I see very little to be lost through intervention, and while the ains won't be enormous there is a possibility of real gains through intervention. These are the scenarios I have in mind.
If we don't intervene and Qaddafi wins we end up with a slightly crazy dictator who doesn't like the west and already appears angry. He may be too distracted with further unrest to focus on taking out his ire on the rest of the world. However, it is not unlikely there will be a diaspora of former rebels seeking refuge abroad. Like in Afghanistan it is not unlikely that since they will have little power to strike at Libya they will act as former anti-Afghani soldiers did and blame the west for their ills. I expect this to be a very high risk scenario that will likely help to fuel terrorism for decades to come.
If the rebels pull victory from the jaws of defeat, say through an unexpected tribal defection, they will give us little thanks for our dithering. If a stable regime emerges it will probably be at best as hostile as Nasser was. While I think the prospects for a stable government in Libya are low an unstable government can be just as dangerous. I'd expect another quasi-failed state from this arrangement. I also expect a quasi-failed state that blames the west for much of their ills do to the damage Qaddafi did in surpressing the rebels and that will be a major source of instability throughout the region, and a threat that may eventually require boots on the ground to suppress, like in Afghanistan, but one whose humiliation and anger is even fresher in memory and more hostile.
If we intervene and Qaddafi wins he will be even angrier at the west and will no doubt attempt to sow instability and support terrorism. However, the rebels will continuge to plague him and they will know they can count on some western support. They may blame our late intervention for their failures (and the longer we wait the more severe this will be) which could lead to problems for us but I believe they'd be more likely to continue to resist Qaddafi. Particularly if we continue to give them covert support. Qaddafi simply doesn't have enough in the way of resources to simultaneously suppress internal unrest and play a major role in causing unrest and damage outside his country. I don't see this scenario as being significantly different from a Qaddafi winning with no intervention scenario so I don't see much risk here.
In this case as long as our intervention hasn't taken a form where we claim to be the decisive factor, I see a potential for a significant warming of Muslim attitudes towards the west. This would undermine accusations that the west does not care about those countries and potentially diffuse a lot of the anger fueling terrorism. While I still doubt Libya will become a liberal democracy, and I think state failure will continue to be a real option, it will be a scenario where if intervention becomes necessary the population won't feel a powerful grievance against the United States, making this scenario far less costly.
These are basically the four general scenarios I see happening. There is a huge amount of variation in which one depending on what the details are, I don't know enough about Libya to say, but I think at this point, with both the rebels and the Arab League supporting a no fly zone, intervention is a clearly dominant long term strategy. I understand the dithering, there's always a status quo bias that makes people think that not doing anything is equivalent to not making a choice, but this is bullshit when the power to intervene is clearly present and everyone knows this. So by dithering, like it or not, we're making a choice and we'll suffer the consequences for it. And they will be negative.
Intervention of course is no certain success, I'm sure our statesmen would prefer to take a wait and see approach to find out who wins, but I don't see this as mattering. What additional harm do we really think Qaddafi will do if he wins? He's still going to hate us after what has happened, and he'll be in a stronger position to make this known. If we intervene he'll be more motivated to act, but his resource situation will be greatly weakened. At this point, win or lose, coming out in favor of the rebels and intervening is simply less costly in the long run. Intervention may help our long term relations with the Muslim world, non-intervention will only inflame existing negative perceptions. I don't see what we gain by not doing anything an the costs of intervention aren't that steep.
Of course, there is the risk that we'll allow our intervention to escalate. This I'm strongly opposed to. Intervention and Qaddafi winning anyways is an acceptable outcome. There's no reason to put boots on the ground and this should be made clear from the start of any intervention. While there's a certain logic to warfare that calls for escalating commitments, I believe the lack of a clear ally or established obligations will prevent this scenario.