I'm trying to follow this whole debt ceiling thing, but it's not exactly easy. Trying to figure out what's good news is pretty difficult...the news seems to only come in shades of bad. The alternatives seem to be a constitutional crisis or draconian spending cuts in the middle of a recession, along with a milder form of constitutional crisis. After all, the least bad option only puts off the next debt ceiling showdown until 2013. Now that the precedent has been set that debt ceiling increases are an opportunity to extract massive concessions from the party that controls two thirds of the government, that's sure to go well.
I'm pretty sure the most bad option is anything that would lead to a balanced budget constitutional amendment...being able to borrow money in years when tax revenue falls unexpectedly or for crises that require extra spending is pretty fundamental. But it's kind of also bad enough that I think nobody serious seriously wants it to happen...unlike completely scrapping the social safety net, which many rich bastards would be pretty ok with. So I don't know how freaked out to be that it's supposedly being included as one of the dire consequence triggers that are supposed to ensure that further spending cuts are enacted.
Speaking of which, I'm sure there are political (or maybe legal) reasons for this, but it seems odd that the Republican hostage* being proposed that's supposed to ensure that spending cuts are enacted by Thanksgiving is military spending. I don't see why the Democrats are willing to accept the premise that Republicans "care" about defense more than they do. Shouldn't the hostage be tax increases for the rich?
*Basically the deal as I understand it now is a certain amount of immediate cuts, and then a promise to negotiate more long term spending cuts by November...and the promise is leveraged by a mechanism that will automatically impose big cuts on something the Democrats care about (discretionary spending) and something the Republicans care about (military spending) if they can't come to an agreement. So basically they get three months to find waste to cut, or else everything's getting cut whether it's wasteful or not. One variant of the agreement also lets them off the hook if they send a balanced budget amendment to the states for ratification. Republicans currently control 26 of the 50 state legislatures.