‘I screwed up’ on nominee picks, president declares

February 4, 2009 at 12:00a.m.

WASHINGTON (AP) — Barack Obama on Tuesday abandoned his nomination fight for Tom Daschle and a second high-profile appointee who failed to pay all their taxes, fearing ugly confirmation battles that would undercut his claims to ethical high ground and cripple his presidency in just its second week. “I screwed up,” Obama declared.

“It’s important for this administration to send a message that there aren’t two sets of rules — you know, one for prominent people and one for ordinary folks who have to pay their taxes,” Obama said in one of a series of interviews with TV anchors.

“I’m frustrated with myself, with our team. ... I’m here on television saying I screwed up,” Obama said on NBC’s “Nightly News with Brian Williams.” He repeated virtually the same words in other interviews.

Hours earlier, the White House had announced that Daschle had asked to be removed from consideration as health and human services secretary and that Nancy Killefer had made the same request concerning what was to be her groundbreaking appointment as a chief performance officer to make the entire government run better.

Daschle said in a brief letter to Obama that he refused to “be a distraction” from the new president’s drive for health care reform. Obama said neither he nor Daschle excused the former Senate Democratic leader’s tax errors but that he accepted his friend’s decision “with sadness and regret.”

Unsightly personal tax problems had been piling up for the new administration. Last week, the Senate confirmed Timothy Geithner as treasury secretary, but only after days of controversy over the fact that the man who would oversee the Internal Revenue Service had only belatedly paid $34,000 in income taxes.

Bill Richardson bowed out, too, though his difficulties didn’t involve personal taxes. The New Mexico governor, who was Obama’s first choice for commerce secretary, withdrew amid a grand jury investigation into a state contract awarded to his political donors.

Questions about Daschle’s failure to fully pay his taxes from 2005 through 2007 had been increasing since they came to light Friday. Daschle overlooked taxes on income for consulting work and personal use of a car and driver, and also deducted more in charitable contributions than he should have. To resolve it, he paid $128,203 in back taxes last month.

Daschle, chosen to lead the administration’s push for sweeping health care reform, also was facing questions about potential conflicts of interests related to speaking fees he accepted.

Killefer, an executive with consulting giant McKinsey & Co., had been chosen by Obama to serve in two roles: as the first chief performance officer in a White House and as a deputy director at the Office of Management and Budget.

When Obama announced Killefer in early January, The Associated Press reported that the District of Columbia government had filed a $946.69 tax lien on her home in 2005 for failure to pay unemployment compensation tax.