Shelby has likely overplayed his hand. The reason holds work is that they're small enough, and rare enough, that they never rise to the level of something the majority can't live with. Shelby, in putting a hold on all pending nominations, just made holds very big indeed. And he did it for the most pathetic and parochial of reasons: pork for his state. If the Democrats have any sense at all, Shelby's hold is about to become as famous as Nelson's deal.I think it's unlikely that Republicans will support Shelby, and if they don't, his ability to delay things all by himself is very limited (this is the situation where forcing a live filibuster actually works, since a single Senator can't hold out forever). Ezra goes over some of the ways that Senators can drag out the clock, but some of that can be pushed off to weekends, or the Senate can turn to other business while waiting, for example, for a cloture petition to be ready. Assuming that Reid wants to fight on this one (and leaking the fact of the hold in the first place was the first step in the fight), Shelby isn't going to win. My guess is that he backs off within a day or so, most likely by this afternoon, as Republicans come to him and tell him that it's a fight they don't want.
As a defender of the ability of individual Senators to affect legislative outcomes, I have no real problem with the institution of the hold in principle. If Shelby wants to fight for some pork for his state, and if he had held up some mid-level appointment over it, then I think that's just fine; they can cut a deal, and life goes on. The idea, however, is that each Senator has to be selective in when and how they use their clout (and they have to really be bargaining for something in good faith -- if not, that's a whole different problem, as per James Fallows's "why bipartisanship can't work" guy). If they go to all-out war over something minor this week, and something else next week, and yet another thing the following week...well, that's going to draw a backlash. I do think that this is an area in which Reid and Obama have too slow to fight back.
So, basically, my feeling on holds is...
1. Selective holds, used occasionally to bargian for something of significant importance to that particular Senator: just fine. Cut deal, move on.
2. Blanket holds, or any kind of multiple holds by single Senators to bargain for lots of stuff big and small: That's hold abuse, and part of the job of the majority leader is to be willing to fight against that, even if it means holding the Senate in session extra hours or forcing live filibusters.
3. Partisan rejectionist holds, in which a 41+ minority all support multiple holds but aren't interested in cutting deals: also hold abuse (and filibuster abuse), but much harder for the majority leader to fight. If the minority choose that course and persist, there's probably remedy short of the nuclear option. More on that point later.