It is just after 4am on New Year’s Eve, journalists in the Stormont Hotel in Belfast have started to tweet that the Northern Irish peace talks are failing.

At 5 am, it is confirmed; in a press conference that feels dark as the dawn, the chairman of the talks, Dr Richard Haass and his co-chair, Professor Meghan O’Sullivan, announces that no settlement had been reached and they are returning to the US after months of effort.

The news line was that the deal, aimed at resolving contentious issues such as parades, flags and the legacy of the past.outstanding issues such as flags, had floundered because the two unionist parties had rejected it. The other three parties involved, Sinn Féin, the SDLP and Alliance had all been more accommodating.

After a week’s consideration, the DUP this week provided a short statement explaining that the proposals needed “more work” while the UUP said it was not “viable” or acceptable.

Many have rolled their eyes in response. “Who cares?” has been a standard response on both sides of the Border and elsewhere.

I think we should care. The news that there is still trouble in Northern Ireland raises universal questions regarding conflict resolution. This is not just a local row. Moreover, the psychological effects of this conflict urgently need addressing.

Obviously successes has been achieved. Here were two deeply entrenched sides, borne of two different cultures, backed by two different governments in a conflict that began centuries ago and that escalated to produce a war that claimed 3,500 lives. Thousands and thousands of others were affected by decades of bombs and killing.

The Belfast Agreement in Northern Ireland and the peace it brought has been hailed as the most successful of it’s kind. It is seen across the world as a case study for other countries and regions emerging from conflict. Even the fact that the Haass talks were being conducted by local parties, rather than the British and Irish governments, represents a real achievement.

The Agreement arose from deep political sacrifice and compromise. The SDLP and the UUP had to cede power to the more extreme parties, Sinn Féin and the DUP.

For Sinn Féin and the DUP, the challenge has been to appease their more radical base. Arguably this has been less difficult for Sinn Féin. The conflict in Northern Ireland was economic in origin as Catholics were discriminated against. This has changed.

It is hard for unionists not to conceive of this as a loss in a zero sum game, especially for the working class Protestants centred in areas such as east Belfast. They are also keenly aware of the demographic change eroding their majority. They feel as if they are in decline. In many ways they are.

It is impossible to underestimate the psychological effect of lost power, the sense of lost prestige. It has made the tradition of conducting militaristic marches through Catholic areas and the right to fly the Union Jack on a daily basis all the more integral to the unionist sense of self.

Much of the Haass/O’Sullivan talks can be described as a set of psychological measures. Flags and marching have constituted two of three concerns.

The third aspect of the talks entails very psychological elements also; the reconciliation of the past. There are still missing bodies and many crimes are unsolved. A large proportion of the population remains deeply scarred by the conflict.

By evening time on December 30th last, the proposals were in their seventh draft and had been heavily diluted. We now know that it had been decided that the flags issue was too complex to be resolved and had, in effect, been parked via a proposal to delegate responsibility to an new body whose details would later be discussed.

The reconciliations of the past section seemed sensible if at times cumbersome. There was a proposal to remove responsibility for investigations into unsolved crimes from the Policing Service of Northern Ireland so they can concentrate on everyday policing. There were also proposals to provide improved psychological services for those affected by the conflict.

Though the detail of the proposals was then unknown, the belief among the media and observers nearby was that agreement would be reached and another late night compromise achieved in Northern Ireland.

At 8pm that evening attention was drawn by the Slugger O'Toole political blog to a Facebook post by James Bryson saying he was "contented and pleased" that there would be no deal done and that Haass would be going home.

Bryson has been at the forefront of the flag protests and has become a spokesperson for working class Protestants. It is he and his followers that the unionist leadership now feel they have to appease.

In retrospect, this was the evidence that the last minute goal was never going to be scored.

On my way to Stormont on Monday, I spoke to my taxi driver, a protestant. It’s become a cliché of journalism but it was his words which were to be the most portentous. We laughed at how friendly everybody is in Belfast when you talk to them and how unbelievable it is that so much trouble can have occurred in one small place. My driver said he thought that was the problem, that everybody was too nice, too nice especially to the “nutters.”

Over the last year I have been been filming with dissidents from the Republican side. They have freely told me that they will never abide by the Belfast Agreement. They feel abandoned by Sinn Féin. They are correct, Sinn Féin don’t care about them. They don’t feel they need them. Sinn Féin have the numbers now and they can afford to assume statesmanlike positions.

The DUP don’t have the numbers. They need the extremist vote. They will continue to appease the “nutters.” That vote is angry and feels threatened.

Could all this mean a return to previous tensions? At this point this seems unlikely, you need adequate opposition to forge a co-dependency of real vigour. Sinn Féin have managed to make themselves look good; they won’t get dragged into this, they have an eye on government in the South. Republican dissidents don’t have the manpower.

As Dr Haass and Prof O'Sullivan said, their proposals will form the basis of later agreements.

So, for now the real losers are all the victims of the conflict who won’t receive improved services and the Catholics who feel humiliated by Unionists marching through their neighbourhoods, and of course, the Unionists themselves. Theirs is a painful process.

The Haass talks were never going to succeed but that doesn’t make them irrelevant. The question of how to undo the evolution of extremist tendencies remains unanswered.