Since most of the polling out (example) there suggests Lincoln will probably lose the general election if trends continue, with Halter faring somewhat better in the general and doing well against her in the primary, most Democrats see this development as an improvement. We're virtually guaranteed to lose the seat if she runs in the general, and we have no interest in supporting her, whereas we have an interest in supporting the more popular and more progressive Halter, who actually does have a shot at winning, even if it's slim. As long as we're going to lose the seat with Lincoln, we may as well try to take her out in the primary.
Blanche Lincoln certainly did not build up a reservoir of progressive support over the past year. Recently she opposed the central democratic principle of majority rule, for example, and delusionally insisted bipartisanship on health reform was still possible. She's one of the worst of the NASCAR Senators, the ones who should be required to wear jumpsuits with their sponsors' logos emblazoned on them because they're so beholden to their contributors' interests, rather than to the voters. She also aggravatingly alternated back and forth on the public insurance option, before coming down so firmly against it that she would join Republicans to block it rather than let it go to an up-or-down vote.
The primary, to the best of my knowledge, will be held on May 18, unless neither candidate reaches 50% (I think there's another minor candidate), in which case a Democratic runoff will be held on June 8.
UPDATE: Since I actually wrote most of this post right after the announcement, I've only just had a chance to update it from reactions. Markos Moulitsas, the founder of self-titled DailyKos.com, has been a big proponent of the Draft Halter push, and he lays out the big reason we should want to take out Lincoln:
These self-styled "centrists" operate at the bidding of their corporate masters, and are awash in their cash. That's who pulls the strings. And with their GOP puppets in the irrelevant minority, it was up to the Lincolns of the Democratic Party to carry their corporatist water. And they did. Eagerly.Kos also cites Halter's outsider, populist credentials with proven ability to win a statewide race as reasons why he's a great choice for the primary. It's an outsider's year.
You need someone to kill EFCA? Call Lincoln, eager to do Wal-Mart's bidding. You need someone to protect Big Oil from regulations that could limit greenhouses? Call Lincoln, who was happy to join Republicans like James Inofe to gut the EPA's ability to protect not just the environment, but the world. You need someone to carry water for the health insurance industry? Call Lincoln, who threatened several times to join filibusters of the public option, and has suddenly become distraught at the notion of using reconciliation to pass health care reform -- after she was one of just 12 Democrats to vote for the 2001 Bush tax cuts. Using reconciliation.



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