This morning’s staff post linked to the essential reading all good political junkies should undertake in preparation for tomorrow’s DNC Rules and Bylaws meeting in Washington to resolve the Michigan and Florida delegate issue. Walter Shapiro’s Salon piece on the subject provides a good preview of the likely outcome:

Despite desperate cries from the Hillary Clinton camp to count every delegate from these two outlaw primaries, which she won, the contours of a half-a-loaf deal are already in place, according to Democratic insiders. Key figures on the Rules Committee informally agreed by telephone Wednesday night to seat the entire Florida delegation based on the Jan. 29 primary, but to give them each only half a vote. The same principle would be applied to Michigan, but there are still unresolved complications over how to handle the “Uncommitted” delegates chosen in the Jan. 15 primary in which Barack Obama’s name was not even on the ballot.
Under this 50 percent compromise, the beleaguered Clinton would gain a 28-delegate edge (19 from Florida and nine from Michigan), not counting the half-votes from the 53 superdelegates from the two rogue states. With Obama nearly 200 delegates ahead and the clock nearing midnight for Clinton, the Rules Committee’s verdict is likely only briefly to delay the anointment of a Democratic nominee.

As Shapiro and others note, a legal brief from DNC lawyers suggesting that party rules limit the Rules & Bylaws Committee from seating more than half the MI and FL delegates paved the way for this solution, which also puts Democrats in line with the sanctions meted out to MI and FL by the Republican Party.
The big issue to watch for tomorrow, however, is how the Clinton campaign reacts to the half-a-loaf deal. They’ve certainly shown no overt signs of accepting a compromise, given the demonstrations they are organizing for the meeting, demanding that both states get full delegation votes.
But the situation really does pose a terrible strategic dilemma for HRC. Accepting the deal would only narrow Obama’s delegate lead marginally, but it would ratify the popular vote results for MI and FL. Depending on how caucus states are counted, and pending the results of the last three contests (where HRC’s popular-vote count is in danger of being undermined by a low turnout in Puerto Rico), party-wide acceptance of the MI and FL votes might bolster her cumulative-popular-vote-victory argument. This is about the only weapon she has left with superdelegates (other than electability claims that aren’t strongly supported by general election polls).
Accepting the deal, though, would presumably foreclose the option of an effort through the Credentials Committee prior to and at the Convention to seat all of the MI/FL delegates, which is the only way under current conditions that HRC can get close enough to Obama’s delegate counts to have any chance to deny him the nomination. On the other hand, rejecting the deal and clearly indicating she’s continuing the battle all the way to Denver could produce a negative superdelegate reaction, and perhaps divisions in her own camp.
The underlying reality for quite some time has been that HRC’s slim hopes for victory depend almost entirely on some terrible development for the Obama campaign that makes her largely theoretical electability arguments tangible and urgent. It hasn’t happened, and the primary season is about to end.
Still, there’s a path she could take that would avoid the appearance of a deeply divisive and largely hopeless fight all the way to Denver. She could accept (with misgivings) the MI/FL deal, get through June 3, make her last pitch to superdelegates, suspend (but not abandon) her campaign, and then sit tight and try to pay some bills. If the Obama campaign does somehow implode, and he’s running fifteen or twenty points behind McCain in the weeks before the Convention, HRC could revive her campaign, and the superdelegates could flip en masse to Clinton if they wished. At that point, her popular-vote-victory claims would provide a nice rationalization for repudiation of the putative nominee by a panic-stricken party leadership.
This course of action, and the period of reconciliation it would invite, might also increase the currently low odds of an Obama-Clinton Unity Ticket, if that’s indeed HRC’s goal, as many observers believe.
I have no clue if this reflects the thinking within the Clinton camp. But she’ll have to make up her mind pretty soon, and the brinksmanship reflected in her rhetoric on MI and FL, and her encouragement of a sense of grievance among her supporters, can’t be sustained much longer without serious negative consequences for her own and the party’s political future.