“Obama will go down in history as the president

Your friend is confusing letter of the law with political reality. No politician in the free world is going to open himself up to accusations of disrupting paychecks for the troops, whether they're legit accusations or not. I think your friend is also dramatically understating the disruption. Yes, paychecks would go, but there's a whole lot of military spending beyond paychecks, notably including purchasing equipment for combat operations, which is not covered by the "essential services" umbrella.