Daschle Withdraws Nomination For Health Secretary

In a statement from the White House, Obama said: "Tom Daschle asked me to withdraw his nomination for Secretary of Health and Human Services. I accept his decision with sadness and regret."

The former Senate leader apologized on Monday to members of the Senate Finance Committee after acknowledging he failed to pay $128,203 in taxes for various consulting services.

Daschle said in the White House statement that he did not wish to be a distraction, Reuters said. "The focus of Congress should be on the urgent business of moving the president's economic agenda forward. This work will require a leader who can operate with the full faith of Congress and the American people, and without distraction."

The president first officially announced his choice of Daschle -- to head both HHS and also oversee a new White House Office of Health Reform -- at a Dec. 11 news conference. HHS and the new office are expected to play a major role in the Obama administration's push for health-care reforms, especially in health-care IT.

President Obama's choice for Chief Performance Officer, which oversees budget and spending reform, also withdrew her nomination on Tuesday for tax reasons.

According to a letter released by the White House and quoted by Reuters, Nancy Killifer said: "I recognize that your agenda and the duties facing your Chief Performance Officer are urgent. I have also come to realize in the current environment that my personal tax issue of D.C. Unemployment tax could be used to create exactly the kind of distraction and delay those duties must avoid."

The president's choice for Treasury Secretary, Timothy Geithner, was also grilled over an initial failure to pay $34,000 in income taxes, but was eventually confirmed.