The Shock Heard Around Washington

No matter how many buddies you have in Washington D.C., no matter how well liked you are, no matter how good you are at your job, you're not spared from paying taxes and hiring legal nannies and behaving on the job. If you have cozy ties with the people you'll be regulating, don't bother working in government. The withdrawal of Tom Daschle, hopefully, will be a turning point.

WaPo: Former senator Thomas A. Daschle, whom President Obama once called "the original no-drama guy," suddenly was forced to step aside as the president's nominee for secretary of health and human services because of problematic ties to wealthy private interests.

It was a jarring twist to Daschle's 30-year career in Washington, one built on a reputation of integrity and decency. After losing his Senate seat while serving as that body's most powerful Democrat in 2004, he swiftly signed on as a special policy adviser to a 900-member law firm and pulled in a multimillion-dollar salary. It is a well-worn path, trod by dozens of ex-lawmakers in the past decade.

But some observing the debacle wondered if the capital's ways were changing. The story of how he fell in with the monied elite and out with the popular mood involves a longtime Democratic financier, Leo Hindery Jr., and his keen interest in currying influence with powerful politicians. The outcome caught many in Washington off guard.

"I think it's possible this is some sort of bridge between an old Washington and the new Washington," David Arkush of Congress Watch said of the initial backing of Daschle and the sudden reversal.

Obama Says the Mistake Was His

Obama got the message.

CBS Transcript
Obama talks about Daschle and a wide range of issues including the stimulus and Afghanistan and Pakistan:

Visit msnbc.com for Breaking News, World News, and News about the Economy

Daschle Tearful

Read the NYT editorial here.
Statements:

This morning, Tom Daschle asked me to withdraw his nomination for Secretary of Health and Human Services. I accept his decision with sadness and regret.
Tom Daschle has devoted his life to public service and health care reform, so that every American has access to health care they can afford. I had hoped that he could bring this passion and expertise to bear to finally achieve that goal, which is so essential to the progress of our economy and the well-being of businesses and families across the nation.

Tom made a mistake, which he has openly acknowledged. 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.

Now we must move forward, with our plan to lift this economy and put people back to work."

From Daschle:

I have just informed the President that I am withdrawing my name from consideration for Secretary of Health and Human Services.
To be chosen by President Obama to run the Department of Health and Human Services and to lead the reform of America's health care system is one of the signal honors of an improbable career.

But if 30 years of exposure to the challenges inherent in our system has taught me anything, it has taught me that this work will require a leader who can operate with the full faith of Congress and the American people, and without distraction.

Right now, I am not that leader, and will not be a distraction. The focus of Congress should be on the urgent business of moving the President's economic agenda forward, including affordable health care for every American.

We need the best care in America to be available to all Americans. We need this effort to succeed. Lives and livelihoods are at stake.

I will not be the architect of America's health system reform, but I remain one of its most fervent supporters. Thank you."

Daschle Should Withdraw

Update: Daschle withdraws. Obama's statement on the withdrawal.
Enough. Daschle's too cozy with the industry, apparently. Besides, if he needs a car and driver, he's too out of touch. There's got to be someone who's clean and competent who could head Health and Human Services. Obama is risking falling short on his ethics vow.
Zina Saunder's work

NYT: Only after the Obama transition team flagged unrelated tax issues that would require filing amended returns did Mr. Daschle and his accountant address the need to report the personal use value of the car service — more than $255,000 over three years — as income. Only after he had been chosen to be the health secretary did Mr. Daschle tell the transition team about the unpaid taxes. He paid some $140,000 in back taxes and interest on Jan. 2 to settle several tax problems — and he acknowledges owing more.

In both the Geithner and Daschle cases, the failure to pay taxes is attributed to unintentional oversights. But Mr. Daschle is one oversight case too many. The American tax system depends heavily on voluntary compliance. It would send a terrible message to the public if we ignore the failure of yet another high-level nominee to comply with the tax laws.

Mr. Daschle’s financial ties to major players in the health care industry may prove to be even more troublesome as health reform efforts proceed. Like many former power players in Washington, Mr. Daschle cashed in on his political savvy and influence to earn $5 million in recent years, including more than $2 million from Alston & Bird, a law and lobbying firm; more than $2 million from the private equity firm, InterMedia Advisors, which provided the car and driver; and hundreds of thousands of dollars for speeches to interest groups, including those representing health insurance plans, medical equipment distributors and pharmacy boards.