Harry Reid was exceptionally generous, offering Lieberman chairmanship of the Veterans' Affairs Committee in exchange for stripping him of his Homeland Security seat. Lieberman said "no," because he helped write the legislation creating the Department of Homeland Security. He's continuing to flirt with the Republicans.
If he joins the Republicans, the best course of action would be to get his ass out of the Senate and replace him with a reliable Democrat's vote.
He's not going to retire. He's not going to be kicked out. What to do, what to do, if he becomes a Republican?
Offer him a high-ranking administration position. *Ducks the spray of bullets coming from angry Kossacks.*
Oh, I'm deadly serious. He's a reliable vote on issues like, say, the environment. He's clearly interested in environmental issues; he chairs a subcommittee within the Environment and Public Works Committee.
He co-sponsored the 1990 Clean Air Act. He voted against ANWR drilling. He voted to reduce oil usage by 40% by 2025. He voted against Gale Norton. He voted to raise the automobile fuel economy standard to 40 mpg. He supports cap-and-trade.
Solution: See if he'd be willing to become head of the EPA. It'd be perfect for him. He'd be willing to follow administration policy on the environment, he'd out of the Senate, it'd be a great show of Obama being a generous president, and Connecticut would have to hold a special election by 2010 to replace him.
The problem, of course, is that Governor Jodi Rell is a Republican and would likely appoint a Republican until that special election were held. But Obama win 61% of the vote in Connecticut. I think many Democrats would have a great chance of defeating her then. And it's better to get a Democrat into Connecticut's Senate seat in 2010 instead of 2012.