Last summer during the debt ceiling hostage crisis, Obama appeared to be the loser, but yesterday Republicans woke up to the reality that they lost Big Time–that we were going to get $1.2 trillion in deficit reductions, with 50% of the cuts coming from the military and none of the cuts from Social Security and Medicare. The Congressional water carriers for the Military Industrial Complex are in a panic.
President Obama immediately threatened to veto any attempt to undo the spending cuts. That means that Republicans would have to get a 2/3 rds majority to undo the first meaningful cutback in the Military budget in 60 years. In addition, if Obama also threatens to veto any attempt to restore the Bush Tax cuts in 2012 (they expire automatically on January 1, 2013), progressives will have totally changed the inequality dynamic, without having to pass a single piece of legislation.
So if this works Obama has managed to cut $600B from the defense budget and undo the Bush tax cuts while having to trim $600B from non-defense spending. It is also worth noting that while he promised to veto any attempt to undo the spending cuts, he made no such promise to block new spending that the Dems might pass.