Daschle exit stuns Capitol

In a stunning turn of events, former Senate Majority Leader Tom Daschle (D-S.D.) on Tuesday withdrew his nomination to be President Obama’s secretary of Health and Human Services.

The news shocked Democratic senators, who had publicly expressed confidence on Monday that Daschle’s nomination would not be significantly impeded by his failure to pay about $140,000 in back taxes.

{mosads}Sen. Tom Harkin (D-Iowa) had tears in his eyes as he tried to speak to reporters on Tuesday afternoon. He said the former majority leader called him to give him a heads-up about the withdrawal,  which Harkin did not believe was necessary.

“I’m emotionally distraught,” Harkin said. “I’m just too emotionally upset right now to talk about it.”

Senate Finance Committee Chairman Max Baucus (D-Mont.) said he had not expected Daschle to withdraw.

“This was not my sense [Monday night],” Baucus said.

Daschle apologized to Finance Committee leaders on Monday night and explained his tax errors, which he rectified with the IRS last year.

After that closed-door meeting, Baucus and other Finance Committee Democrats appeared with Daschle at a press conference to support their former leader.

Many on Capitol Hill believed that Daschle’s nomination was not in jeopardy despite the fact that Republican Finance Committee leaders refused to comment after the Monday meeting.

Obama also was confident. Asked if he still supported the embattled Daschle Monday morning, Obama said:

“Absolutely.”

But on Tuesday morning, The New York Times published an editorial that called for Daschle to withdraw. Later on Tuesday, Sen. Jim DeMint (R-S.C.) said on Fox News that Obama should pull the nomination.

Daschle told Andrea Mitchell of NBC News that the editorial and GOP opposition were major factors in his decision to bow out.

“I read The New York Times [Tuesday] morning and I realized I can’t pass healthcare [reform] if I am too much of a distraction, and when I saw what the Republicans were saying and read The New York Times, I called the president [Tuesday] morning,” Daschle said.

Mitchell described Daschle as emotional and overwrought in her interview.

Daschle, who has penned a book on healthcare, was expected to play a leading role in revamping the nation’s healthcare system. Daschle endorsed Obama early in the Democratic presidential primary, embracing the Illinois senator over former Sen. Hillary Rodham Clinton (D-N.Y.).

Daschle’s decision came just hours after Nancy Killefer, Obama’s choice to be the nation’s first chief performance officer, withdrew her nomination because of problems dealing with her personal tax returns.

DeMint said that Daschle made the right decision.

“He saved the president some embarrassment,” DeMint said. “And he saved his friends and colleagues here a lot of angst, because the Democrats would have voted for him no matter what, and it would have done a lot to discredit the Obama administration.”

The Daschle and Killefer nominations, coupled with the personal tax controversies that surfaced in Treasury Secretary Timothy Geithner’s nomination, have raised questions about the White House’s vetting standards and Obama’s ability to implement the ethics standards he touted on the campaign trail.

{mospagebreak}White House press secretary Robert Gibbs, who came under fire from reporters in the briefing room on Tuesday, acknowledged that the day’s events were an embarrassment to the White House, but added that the president continues to have “confidence in the [vetting] process.”

Obama said in a statement that he accepted the former senator’s withdrawal “with sadness and regret.”

“Tom made a mistake, which he has openly acknowledged,” Obama said. “He has not excused it, nor do I. But that mistake, and this decision, cannot diminish the many contributions Tom has made to this country, from his years in the military to his decades of public service.”

{mosads}Gibbs said the White House did not send any signals to Daschle to withdrawal, and senior Obama adviser David Axelrod told reporters on Capitol Hill that the president was surprised by Daschle’s decision. The former majority leader called Obama in the president’s private study near the Oval Office.

While Daschle said he wanted to avoid being a distraction, his announcement came shortly before Obama was scheduled to sit down for one-on-one interviews with all of the cable news and network anchors in what was supposed to be an effort to sell his economic stimulus plan.

During those interviews, Obama accepted blame for the Daschle nomination.

Obama said on CNN’s Anderson Cooper 360, “I think that, look, ultimately, I campaigned on changing Washington and bottom-up politics. And I don’t want to send a message to the American people that there are two sets of standards, one for powerful people, and one for ordinary folks who are working every day and paying their taxes.”

Obama said he was working to ensure a similar  “mistake” won’t happen again.

“I think I screwed up,” Obama said. “And, you know, I take responsibility for it and we’re going to make sure we fix it so it doesn’t happen again.”

Gibbs said Daschle’s withdrawal — both from HHS and in the White House Office of Health Reform — will not hamper Obama’s efforts to reform the nation’s healthcare system.

But Senate Banking Committee Chairman Chris Dodd (D-Conn.), who is a close friend of Daschle’s, said he does think the withdrawal is a “major blow” to healthcare reform.

“I’m confident the president will come up with another nominee fairly quickly and we can move forward,” Dodd said. “If you don’t have the secretary of HHS, it hurts. It slows things down.”

Kansas Gov. Kathleen Sebelius (D) and former Sen. Bill Bradley (D-N.J.) have been mentioned as possible replacements for Daschle. Before Daschle was named, former Democratic National Committee Chairman Howard Dean, a physician, reportedly was interested in the high-profile post.

Gibbs did not mention any names, saying that “obviously, the administration is looking for replacements as we speak.”