I think it’s pretty clear that we’re looking toward a scenario in which John Boehner shuts the government down in the near future. There’ll be a lot of moves between now and then and a lot of reporting on the details, but I think the basic dynamic is pretty clear and abstract. You can compromise about numbers—$10 billion or $5 billion. And you can compromise across modes—cut that instead of this. But you can’t compromise between Congressional Republicans desire to force the White House into a humiliating defeat and the White House’s desire to not be humiliated and defeated. A compromise acceptable to the President would, by definition, fail to meet the objective of halting the march toward socialism.
The interesting theoretical question, I think, is why did the 2006 midterms not result in a government shutdown the way the 1994 midterms did and the 2010 ones will. Part of the issue may have been priority mismatch. Congressional Democrats cared most about seizing the opportunity to increase spending on some core domestic initiatives, while the Bush administration cared most about maintaining a free hand to conduct the war in Iraq. There was intense anger at Democrats from the base for not doing more to force the issue on Iraq in 2007, but it wasn’t anger that had any basis in organized interest groups with real leverage.
The fact that a president (with his nationwide constituency) and a House Speaker flush with midterm victory (having won most recently) both have plausible claims to popular legitimacy makes these kind of clashes difficult to resolve. If Obama were the King of England, then what would happen is that over time his legitimacy would erode and power would pass to the Speaker.